How Virtual Reality Training could help you drive your training costs down by up to 99%?

Recently, we sat down with the leadership of the manufacturing division of a popular FMCG company in Pakistan. We discussed the problems of training in manufacturing in detail, and the integration of technology into business operations being the need of the hour. We garnered a range of insights from the conversations. However, two lessons specifically captured our attention. These were:

Training Challenges of Manufacturing Businesses

1. Manufacturing companies were accruing high human resource costs.

This was due to various factors. The most notable contributors were compensation costs and training costs. These costs were due to the high turnover of artisans in the industry and the long duration of training before an artisan starts creating value due to the sensitive and high-stakes nature of the machinery. We found out it took as long as 12 months for an artisan to train for and do the job for which they were hired!

2. Manufacturing companies were accruing high maintenance costs that went beyond just the machinery maintenance.

Invisible bleeding of profitability occurred in the form of lost sales and contracts, labor idle costs, and numerous other costs, due to stopping the machinery for maintenance or training. We found out that stopping the machinery for 12 minutes in 12 hours was costing the company millions of dollars. This was only the standard downtime where production halts related to training or other reasons were not even accounted for!

We then sat in our office at Orbit-Ed and conducted a comprehensive analysis to properly ascertain the sheer scale of the cost of traditional training for manufacturing businesses. We focused particularly on the Cost of Training New Artisans and the Cost of Stopping Machinery for Maintenance or Training, and the results were eye-opening, to say the least.

Forecasting the Cost of Training New Artisans and the Cost of Stopping Machinery for Maintenance or Training

We started by defining the cost centers that could fall into the cost of training new artisans. These cost centers were the artisan salaries accrued due to their training period and the indirect supervision cost as an expert artisan was spending a significant part of their workday explaining and training the new artisans.

We procured the data for monthly wages, the average number of artisans in a factory, and other factors using research reports and data provided by the manufacturing facility. We found out that training new artisans was costing approx. 45 Million Dollars per year on average to a manufacturing company.

This was apart from the approx. 180 Million dollars that a company was losing annually in the form of lost production and sales. This number had two subcomponents i.e. lost production revenue and idle labor costs. We calculated these cost centers using revenues from financial statements of businesses, and online research reports.

These costs in total cost 225 million dollars on average per year to a company. An innovative and effective solution to these costs of traditional training lies in technology. AI-powered Virtual Reality training costs only a minute fraction of the costs of traditional training. Not only this, it also solves the myriad of problems and challenges associated with traditional training such as a lack of focus, lack of quantified and personalized feedback, trainer bias, etc.

Orbit-Ed VS Traditional Training and Conclusion

If 150 artisans in a manufacturing facility use Orbit-Ed twice for 80 days, we predict that they will be prepared to handle and operate machinery in less than 3 months as compared to 8-10 months, which is the industry standard. This will cost 127,000 US dollars per year on average to the company which comes at less than 0.06% of the cost of traditional training.

This means that Orbit-Ed leads to huge cost savings. Moreover, it also reduces reliance on one expert artisan for training. AI-powered VR training delivers real-time insights on the trainee’s performance and behavior, gives seamless tracking of a trainee’s performance through a dedicated learning management system, provides personalized feedback to the trainee based on performance, and guess what! This is just the tip of the iceberg!

Orbit-Ed provides industry-agnostic training products that could not help your manufacturing or production team get up to speed and truly reach their true potential, your commercial and business teams could be the next in line toward meaningful business growth.