October 23, 2012 Leave a comment
There has been lots of press coverage and professional journal coverage of operational excellence, cost structure, organization, logistics and supply chain management over the last 5-7 years. What has been lost in the shuffle is how to evaluate, measure and improve productivity. Few organizations have the capacity to perform productivity analysis beyond the calculating production or service levels over consecutive time periods.
Alas, productivity is how organizations excel and how they are able to offer lower prices, better quality, and higher profitability. So what are the key activities to increase the capacity of organizations to bring productivity into the forefront of their operational and business reviews?
- Benchmark others. In my dissertation completed ten years, there was a 100% connection between benchmarking and organizational improvement.
- Develop a precise measure of productivity for the organization, and define each term used in common practice
- Construct simple tools and simulations to perform basic cause and effect analysis using standard input such as labor, material, equipment, systems, and environment.
- Add the measure and the ultimate evaluation of performance to the top management agenda and KPIs
Then you will be able to truly compare how your organization fares in the market, and the factors that stand in the way for higher operational performance.