It is getting more and more difficult to compete in the worldwide marketplace that we all live in. Whether you are making cars or widgets, there is somebody out there trying to build them less expensively and faster than you. But the question is if they are making a better item? For some consumers, it doesn’t matter, cheaper is good enough even if the part doesn’t last as long. It is weird and regrettable, but cheaper has become the catchphrase 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 goal is to produce a good, high value part and to make it of high worth to your buyers. The producers of the product do not establish what they makes’ value; the buyer does. What is the consumer ready to pay for your product and how big of a demand for your item is there? There are different ways to boost your earnings for your product.
You can always increase the price and pass it off to the buyer. But there is a better way, a more long term way that can raise profits and keep your company operating lean and efficiently. It all starts with eliminating unnecessary waste in all parts of your organization. Waste comes innumerous forms and it costs every business more money than they would care to disclose. Waste is when employees are just standing around, but that does not mean that there aren’t orders to be filled. It might just mean that they are waiting for parts to be finished in the electrical department or it could mean that they are waiting for product from a vendor. These are process problems that can directly affect the end product and how many you can produce. When workers are loafing around, idle and waiting for the job to come to their area, they are not productive. They are unused and are in essence merely wasting money and time. It is the same when you have machines sitting unused. What is the point of having a fancy automatic machine if it is not being used for hours a day? Would it be more cost effective to do the job by hand, sell the robot and purchase a piece of machinery that will be more fruitful? What about the room that the machine is taking up, could another work area be put there and more labor actually be finished without the robot? You can’t say that you don’t want to do away with tools because you might want it. If you are not making use of it or it is obsolete, then it is taking up valuable space and not contributing to the expansion and profit of theorganization. It can be uncomfortable to admit that getting that machine was a bad idea, but if it does not and doesn’t help build the company, then it is time to move on and discover something that does. It is named adapting and moving forward.