Production – Where the Rubber Meets the Road

Production is the one area that you as the business owner need to devote your energy towards over any other. I’m an administration guy, many years of experience dealing with those types of issues. But there is one thing I truly understand, which was taught to me by a client, if you don’t produce the money, the rest of it is just a great paperweight.

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. 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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