This is where the rubber meets the road. Production makes the money for the company. Implement production control systems to monitor production efficiency and effectiveness, create a process flow to minimize labor needs, and deliver the product. There are techniques, systems, and even some good ol common sense that maximizes production with the least amount of resources.
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All the rest of the business issues I write about mean zilch unless you have great production. This is the one area that you as the business owner need to devote your energy towards over any other.
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 ...
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, ...
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. To maximize profit in any business, operate within your range of ...
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 ...
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 ...
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. With service, the cost drivers could be the actual ratio of billable to non-billable time.
Up Time in business refers to maximizing opportunity to generate profit. There is one key modifier. If the marginal costs to generate revenue exceeds the revenue generated, the business is no longer maximizing profit.
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).
Labor burden refers to the additional costs an employer pays to have employees. The labor burden rate is a value added onto direct wages to understand the actual cost per unit of wages paid for an employee.
