Member Blog: 5 Ways To Increase Operational Efficiency

by BriAnne Ramsay, CEO of RMCC, and Karen Mayberry, Marketing Director and Co-founder of Trym

In the evolving cannabis industry, companies are streamlining and optimizing their processes.

Labor is the highest expense in commercial cannabis activity across the supply chain, accounting for nearly half of production costs. For example, cannabis cultivation requires a skilled team to support production, harvesting, and processing, and packaging. As a retailer, it’s imperative to calculate labor cost per unit. When these costs aren’t accounted for, inefficiencies lead to lower margins.

Owners and managers are looking at their bottom line and strategizing on how to increase their operational efficiency. In this article, the folks behind Trym and RMCC, share their suggestions on doing just that. 

Standard Operating Procedures

    1. SOPs aren’t just for the operating license application, this is your company’s playbook. These procedures outline not what you intend to do, but what you are doing. If you change what you’re doing outside of that playbook; those SOPs need to reflect that.
    2. How do you know your SOPs are being followed? Systems with consistent checks and balances! Data doesn’t lie!

Training and Ongoing Support

    1. Many of us know from experience the cannabis industry has a higher employee turnover rate at 40%-60% within the first 2 months. One might infer it’s because, in a budding industry, we haven’t yet had the time or resources to focus on developing our “training departments” as large corporations have. Cannabis is busy jumping through hoops to satisfy external requirements and therefore we devote our resources to short term needs rather than investing in training infrastructures. 
    2. Maintaining a consistent, up-to-date learning strategy with executable training plans will help you decrease turnover – in all aspects of your operation. What experience does a new (or seasoned) employee have when coming on board or changing roles? Do they know what happens before they join the team? Day 1? Week 1? After a month? Complex roles may take up to 6 months or longer to acclimate to. If employees get frustrated early on they head out the door. What can you do to prevent this from happening? 
    3. Targeted training with ongoing support is crucial to maintain and improve efficiencies. The data shows that investing in your employees decreases turnover and in the long-term, increases your profit margins. According to the Association for Talent Development (ATD), companies that offer comprehensive training programs enjoy a 24% higher profit margin than those who spend less on training.

Communications Strategy

    1. Today’s world demands quick, effortless distribution of information. One way to increase everyone’s efficiency is to enable that flow of information. Decrease the frequency and length of meetings. While important for decision making and collaboration, too many meetings correlates with lower labor efficiency.
    2. Introduce a company-wide communication tool, like Slack, to leave the inbox for truly important emails while also opening up communication between departments. 
    3. Build an intranet with internal SOPs, workflow diagrams, important announcements, checklists, etc. Provide your employees with the tools and path to success. When communication flows across departments and seniority, you get a team structure that isn’t limited by bottlenecked decision making. Leadership is more accessible and the company can act quickly, achieving optimal results. 
    4. Create incentives for your team to perform great work. Recognize their accomplishments and offer support when necessary. Positive employee morale goes a long way.

Regular Process Reviews

    1. Implement internal checks and balances such as audits, workflows and Key Performance Indicators analysis. Consistently reviewing production data will ensure the licensee identifies their operational gaps and can adapt to more efficient and compliant workflows.  
    2. Third-party audits are great resources to identify compliance risks that may not be found through internal audits. 
    3. Monthly or quarterly reviews of standard operating procedures are recommended to verify the documents accurately reflect the physical flows and the details reported to the state agency. Perhaps the state has made changes to their regulations and SOPs need to be modified?

Software Tools That Bring Value

    1. Software has the power to automate certain processes and save labor time. When chosen, implemented and adopted correctly, it can greatly increase company efficiency. The first step in software evaluation is identifying the challenges your company faces and the ways in which software can help. Then, evaluate each software product on how well its features and services can support your efficiency goals.
    2. In the cannabis industry, there are many ways to enlist software to optimize workflows. There are traditional software tools like Asana and Slack for project management and internal communication. And there are industry-specific tools like Trym for METRC reporting and cultivation management or Simplifya for compliance monitoring. Check out our piece on implementing Metrc solutions for your cannabis business if you’re in a Metrc state!

BriAnne Ramsay is the CEO of Rocky Mountain Cannabis Consulting (RMCC).

RMCC’s training courses, expert counsel, procedures, and documents help businesses achieve and maintain compliance. RMCC helps Operators and Technology companies excel in daily operations, implement seed-to-sale software, provide comprehensive training with on-site evaluations, and gap analysis. We help build the infrastructure of compliance operations through customized Standard Operating Procedures.

 

Karen Mayberry is the Marketing Director and Co-Founder at Trym.

Trym is farm management software custom-built for cannabis cultivators. Trym improves efficiency and consistency through environmental monitoring, customized task and batch management, and data analytics. Trym is currently integrated with Metrc in California and Oregon, and is used alongside compliance software in other states.

 

Member Blog: Increasing Employee Retention in the Cannabis Industry

by Matthew Hughes, Ximble

A recent report from Headset Cannabis Intelligence utilized Point of Sales systems to gather data from Washington and Colorado state cannabis dispensaries.

The general overview of dispensary budtenders is that they don’t tend to stay around long as the job role has a high turnover rate. In fact, nearly 60% of employees don’t last past two months – and only 40% make it past the first. To make new hires worth the time and cost retention is essential, otherwise any hiring dispensary will be hemorrhaging time and money that could otherwise be directed into the growth of the business.

With only 14% of employees lasting beyond three months, it’s obvious that the quality of onboarding and training is a crucial, determining factor of retention.

The type of welcoming into the workplace, type of training and management they receive in conjunction with the tools they receive for work all contribute to whether that stay past the two-month mark.

While the roles in cannabis dispensaries may come with their own challenges, there’s no clear reason why turnover is so high.

With the industry expected to grow from $9.2 billion to $47.3 billion over the next decade within the U.S alone, it could be that the growing opportunities available allow budtenders to choose and hop between employers within the industry, meaning that dispensaries need to compete against one another to retain employees. Alternatively, it could be the management, burnout, being overexerted or under challenged.

Either way, there are a number of employee management methods that help reduce the employee turnover rates by creating an engaging and hospitable working environment, which will in turn lead to the reduction of hiring and training costs, the boosting of team morale and consistency in the customer experience.

Promoting Workplace Harmony

The running of a dispensary requires management to constantly assess staffing costs and needs for the changing demands of the business. However, too much attention to the needs of the business and too little on employees can lead to the overworking of staff, burnout and an unpleasant working environment.

It’s worth noting that Headset Cannabis Intelligence identified that high growth dispensaries (40% growth) have fairly high turnover rates, while dispensaries with 20% – 40% growth tend to have more stable turnover rates.

With dispensaries that are growing slower and steadier, they do benefit from lower turnover. However, with rapidly expanding dispensaries, it appears it may not matter what the employee churn rate is. Although, regardless of the rate of expansions, employee churn harms the business’s bottom line in the form of hiring and training costs, inconsistent performance and customer experiences.

Effective employee management will maximize productivity as well as engagement. To do that it must involve adequate time off for employees to attend to their personal obligations, like education or family, and time for recuperation.

With a variety of employee management solutions available, it can be hard to know which tools will actually help. With employee organization being at the heart of engagement and productivity, a solid employee scheduling solution should be at the top of the list. Decent solutions will be able to assist in keeping employees’ needs in consideration during the scheduling process by setting working parameters like their availability, maximum working hours and shift lengths, resulting in easier organization with greater visibility of your available resources.

Alternatively, many solutions allow varying degrees of employee self-management. The amount is up to management, but it can range from complete self-management, where employees opt for the shifts that suit them, to allocated shifts where employees can arrange their own shift-swaps, drops and pick-ups with managerial approval.

However employees are managed, the truth is that a workplace that considers and accommodates the workers’ needs is appreciated and makes for a desirable working environment.

Communication/Involvement

The value of effective communication cannot be understated for operation efficiency and performance. Although widely understood, its importance is often overlooked with regards to employee retention.

A staggering $2,100 to $4,100 is lost by businesses each year with poor communication being the sole cause. The Bureau of Labor Statistics (BLS) identified in 2014 that the staff turnover rate was at 66% with that percentage increasing ever since.

People like to feel their role has a purpose and their input makes a difference if they are to remain performing optimally and satisfied in their role. The problem is that communication in businesses is in a usually top down manner.

The promotion of the bi-directional flow of information can be used to elicit feedback from employees on a regular basis. It encourages staff to alert management of any issues they’ve noticed, be it operational or otherwise. Utilizing the snippets of information gathered from employees can be used to drive positive change in both operations and the working environment.

By opening up dialogues with employees, be it weekly, monthly, or via an instant messaging app it shows their opinions and input matters, when acted upon. It makes employees feel like a valued team member and keeps them actively engaged in their role. As such, the working space becomes a much more positive and proactive place that employees enjoy working in.

Recognition and Reward

A cannabis dispensary’s employee schedule may not necessarily be constant from week to week, which can cause missed opportunities and events in their personal lives. If employees aren’t given recognition for their contribution and sacrifices towards the dispensary’s success, they can feel alienated and undervalued, causing them to look for somewhere where they will be appreciated.

That is why recognition and rewards of employee performance is so important. With over 70% of employees feeling disengaged in the company they work for it’s important that we treat employees as more than a cash machine. In doing so, they will see their work is appreciated and continue to remain engaged and productive. The reward itself doesn’t need to be large or over the top, even a few words of praise can be enough or an annual bonus.

It can be difficult to gauge performance solely by watching employees. That’s why a good workforce management solution can help, as it is possible for employees to log completed activities and add shift notes. This delivers and insight into workforce performance of each individual employee and makes it possible to identify those who deserve recognition or are ready for advancement.

Recognition encourages engagement from team members and employees tend to stick around for longer when they feel they are valued in the workplace.

Every dispensary is different and every team is a collaboration of different personalities that require different approach to management. There is no “one fits all” solution, but increasing the standard of employee management with an emphasis of improving the employees experience and sense of value will help to boost employees’ job satisfaction. Upon doing so staff turnover may not disappear, but will drop as job roles to employees today are more than a paycheck; they must carry meaning and value which needs to be communicated from management down.


Matthew Hughes is a British-born content writer with the mindset of a cat, he has a curiosity for the unknown, can be impulsive and can be won over with food. The best place to catch him will be in the offices of Ximble, a dynamic cloud-based workforce management system that simplifies employee scheduling, time tracking, and management. He also hates Sudoku.

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