Entradas Etiquetadas con ‘productivity’


Let’s jam!

Escrito el 15 julio 2010 por José Luis Fernández en Lean Services

Angel Díaz, our Operations Professor, uses to organize what we are calling Jam Sessions. (An informal gathering of musicians to play improvised or unrehearsed music.)

The format is as follows:  He invites for one of his latest classes at the IXMBA programs several friends who develop their careers in different sectors. These guys have around 15 minutes to bring to the students the flavour of the operations in their specific sector, the trends they identify and what are the main challenges they try to face at their environment. After that, there is a turn for questions and an open discussion.

In today’s session, there has been a common bond in the presentations related to LEAN expansion and transferences in such a way as the jazz fusions with other styles.

Concepts originally applied to automotive sector expanding, as innovation,  to trains and aeronautics evolving their quality standards, as lean kills the costs of low quality, productivity and the workers culture in sectors coming from monopoly, union, low profile, feelings.  

Some jumps through technology to get to luxury sector applications both in supply chain and retail services and finally lean applications in retail banking.

Agents of the lean evolution-revolution are workers coming from those leaner environments; fusion is similar to musicians bringing new rhythms to aged styles.

In the forum, we have found lean principles in several environments, even in extreme software design.

Where have you found traces of lean?

Let’s jam!


My Own Japanese Strike?

Escrito el 7 abril 2010 por Jesus Guerro en General

I do not know which will be your perception but according to my experience, many companies tend to provoke Japanese Strikes inside the Organization by their management practises and the order of their priorities.
Obsessions for productivity ratios based on volume of output per time (on run or daily basis) can be extremely dangerous when there is not enough demand at short or even medium term to absorb that fantastic production.
Some analysts, and what it is worse, some CEOs, believe that fixed costs and so, investment, is better amortised with bigger production runs following the basic principle of product costing by wich the higher the volume of output produced, the lower the portion of fixed cost assigned to each unit.
Unfortunately, this is not always true in real terms. The investment applied to acquire raw materials and maintaining capacity remains in inventory if we produce at a higher rate than we are able to sell. The cost of capital associated to these inventories as well as the cash flow retained, push the company to increment debt to tackle payment responsibilities and therefore, incrementing total costs. Amazingly, I have seen companies taking their pallets out of their warehouses or subcontracting warehousing services, adding expenses to the original investment, when demand is not really claiming that volume by far-
Sometimes companies react to mountains of invetories, downpricing so that, reducing average margins nad punishing brand image.
From my viewpoint, Investment is never returned with kilograms, littres or pieces. Investment is only returned with money. The rest, it is just an Ilussion.
However, Productivity ratio provides competitive advantage in costs when products are sold under just-in time basis. Thus, when capacity and demand are prefectly matched. Keeping a Lean Flow of materials, and so cash, brings us real opportunity for differentiation since we will have higher free resources to foster strategy.
On the other hand, I think more recommendable to figure up Productivity indexes comparing value of goods sold with input value considering as input all the resources we put in practise to achieve that concrete production.
So, Be Carefull with some knd of Reporting!
Obsessions with Productivity could be fatal for your sustainability!

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