clear goals
3 GOALS OF WORK
The three goals of profitable business are:
- MAKE MONEY & CREATE JOBS
- CONTROL PROFIT MARGINS
- CONTROL OPERATING COSTS
1. Make Money & Create Jobs
Businesses create jobs by generating a continuous and profitable exchange of created value (outputs) for other valuable resources (inputs).
2. Control Profit Margins
Businesses control margins by continually increasing sales revenue on outputs, while also decreasing both the input costs and processing costs of providing the service or product.
3. Control Operating Costs
Businesses increase operating profit margins by continuously reducing costs, labor and lead times by improving the effectiveness and efficiencies of process capacities by removing constraints, errors and waste in the task, process, system or chain of command.
Do your teams have clearly defined purpose, company goals, and objectives for profitable growth?
Alignment to Goals
3 Types of Work:
Business activites must align to top down goals
- Business Development Projects
- Departmental Projects and Activities
- Operations & People
Business Development Projects
Purpose: New products, more capacities, new materials, new suppliers, new processes, new markets, new people, and new customer wishes.
Departmental Projects and Activities
Purpose: Infrastructure, supervision, preventive maintenance & repairs, staff training, current backlog and deadlines, supplier coordination, budgets, and including all projects that support the business development objectives.
Operations & People
Purpose: Activities at the task level required to achieve the desired results of 1 and 2, including continuous improvement efforts.
Are your teams aligned to defined priorities, actions, and expectations for achieving goals daily?
flow to customer
3 Essential Flows of Work
Business Processes must create value to the customer and provide feedback to management on performance to goals, customer satisfaction, and for continuous improvement efforts.
- Value Flow (SIPOC)
- Intelligence Flow
- Adaptability Flow
Value Flow: SIPOC
Work should always flow towards the customer, to their requirements, when promised, as effortlessly as possible, and with minimal waste of time and resources.
SIPOC: Suppliers provide Inputs to Processes for Outputs to Customers. Each step in the process should have clear requirements to ensure the proper inputs and outputs are processed through the system at the appropriate rate of supply and demand. F(X)=Y
Flow is also about volume, and the velocity of that volume, through the process consistently without issues. Identify and remove defects, waste, barriers, bottlenecks, and other constraints in the task, process, system, or chain of command.
Intelligence Flow
Creating, continuously monitoring, and analyzing effective feedback loops (KPIs) between processes and business interactions.
- Use information, data collection, and effective communication channels and methods to identify and report errors and defects between people, systems, and businesses.
- Detect and address issues early and often to improve outcomes and prevent failures from moving downstream to the next or final customer in the value stream.
- Continuously evaluate and improve your Preventive & Corrective action systems and processes.
Adaptability Flow
Semper Gumby! Always improvising, adapting, and overcoming.
Endlessly experimenting to learn from mistakes and achieve mastery. Eternally testing and improving how effectively and efficiently the Flow and Feedback processes are working.
Any fool can fail. A wise fool will fail, learn and try again better.
