Production Control

Of all the aspects of business, producing the goods or providing the services is the most critical of all. Without this function, the company would have no revenue to operate. Every business owner entrepreneur should dedicate themselves to this aspect of business as their primary function each day.

Project Reports – Introduction

Project Reports

There are basically three groups of financial based project reports.  Each set has its own priorities and purposes.  Project reports are a function of production reporting with the exception of the balance sheet set (commonly used for cash flow purposes). 

Cost Drivers in Small Business

Cost Drivers in Business

The textbook answer defines cost drivers as those factors that determine the overall cost of operations.  As an example, in manufacturing the cost drivers may be processing time or number of steps to produce the product.  In service, the cost drivers could be the actual ratio of billable to non-billable time.

Throughput – Business Definition and Identification

Throughput

When a business can maximize the product or service delivered within a given period of time, it has reached maximum throughput.  This is the basis of maximizing earnings and therefore profits for a company.  This article will examine the definition more thoroughly and illustrate to the reader how to identify issues associated with the throughput for your business.

Operating Control Reports in Business

Operating Control Reports

A part of any information feedback loop is the operating control reports in business.  Depending on the nature and financial impact involved, these reports can be daily (Daily Operating Controls or DOC), weekly (Weekly Operating Controls or WOC) and/or monthly (Monthly Operating Controls or MOC) in management reporting.  Their value is to inform management of business activity and identify any potential issues that could generate undue financial harm on the business or worse, create an unsafe product or work environment.

Operate Within Your Range of Production

Range of Production

One of the basic business concepts is range of production.  It means maximizing the capacity (range) of the assets in your operation.  When the business operation goes beyond the maximum production range, costs associated with the marginal production generally exceed the revenue generated with the marginal increase.  So to maximize profit in any business, operate within your range of production.

Find the Bottleneck

Bottleneck

In every business no matter production or service, there exists a bottleneck.  Your job as the owner or manager is to find it and fix the problem.  Once this one is found and resolved; move onto the next one.  There is always a bottleneck to find and fix.  What is important is to find the problem, identify the core issue, and then resolve the bottleneck.  This may sound simply, but it takes someone in a position of knowledge and experience to complete this task. 

A Story About Great Production

Production

What I learned was that equipment didn’t call in sick, it didn’t back talk me, it never got upset about how much it was paid and it just kept on humming.  It was making us money and I didn’t have to deal with personnel issues.  Boy, if only all production could be like this.  Turn it on and make money.

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