It is becoming much tougher to compete in the global marketplace that we all dwell in. Whether you are making motorcycles or widgets, there is someone out there trying to build them cheaper and quicker than you. But the question is if they are building a better product? For some buyers, it doesn’t matter, cheaper is good enough even if the part doesn’t last as long. It is strange and regrettable, but cheaper has become the motto and the word of choice for many consumers and companies. Yes, less expensive is better, but cheaper doesn’t always work out for the best. So the object is to produce a good, high quality part and to make it of high value to your potential customers. The makers of the product do not establish what they makes’ value; the consumer does. What is the buyer ready to pay for your product and how big of a demand for your part is there? There are different ways to raise your revenue for your product.
You can always increase the price and pass it off to the consumer. But there is a better way, a longer term method that can increase revenue and keep your company working lean and efficiently. It all starts with removing unnecessary waste in all parts of your organization. Waste comes in many forms and it costs every organization more money than they would care to confess. Waste is when workers are just hanging around, but that does not mean that there aren’t orders to be built. It might just mean that they are waiting for parts to be completed in the electrical department or it could mean that they are waiting for parts from a supplier. These are process problems that can directly affect the end product and the speed at which you can produce. When workers are loafing around, unused and waiting for the job to come to their area, they are not producing. They are unused and are in effect merely wasting cash and time. It is the same when you have machines sitting quiet. What is the point of having a costly automated machine if it is not in use for hours a day? Would it be more cost effective to do the process by hand, sell the machine and buy a piece of machinery that will be more productive? What about the room that the equipment is taking up, could another work station be put there and more work actually be completed without the machine? You can’t say that you don’t want to do away with parts because you may want it. If you are not utilizing it or it is obsolete, then it is taking up space and not contributing to the growth and profit of thefirm. It can be uncomfortable to admit that getting that equipment was a bad idea, but if it does not and doesn’t help grow the company, then it is time to move on and realize something that does. It is named adapting and going ahead.