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Benefits & Liabilities of Adding More Shifts

A business owner has a growing manufacturing company. Business is improving, but the owner needs to see more output. He is considering adding a second and third shift.
What are the potential benefits and liabilities to starting these new shifts?
What would you recommend, and why?

Solution Preview

Adding a second and third shift offers the potential benefits of being able to produce more product. This might also help the business curtail any overtime pay it may currently be experience. Also, the more the company can utilize its existing equipment, the more efficiently it can operate. By avoiding the need to buy more manufacturing lines, and adding more production throughout the day there are savings. Greater production capacity can also help the organization create faster customer turnaround and increase job efficiencies.
However, with this increased capacity the business must hire more people, which means there will be costs ensued in hiring (personnel costs, training, wages and benefits). In addition, greater worker comp expenses, ...

Solution Summary

This solution discusses the potential benefits and liabilities of adding new shifts to a manufacturing organization that is experiencing increased sales and gives a recommendation, and reasons for the recommendation. Includes APA formatted references.

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