Business Fundamentals
Is always good to know the basics of anything whereof you are trying to learn, in order to built a value-centered enterprise it is important to build a foundation first. Every work place no matter what the service or product needs to have visual management tools, as we can see there are visual in all our day-to-day life, for example we see signs over the freeway where we can go to eat or exit signs, we go to a fast food restaurant and through the visuals we can order our food, or where the drive thru is located, therefore visual management tools give us instructions of what to do, how to do it, and when to do it, besides it help us to know how the job progress, and it help us to keep the place work clean with the inclusion of SAFET.
When we talk about time management I thought we were going to talk again of time management in our life but this time we are talking about the business, Process time-time to produce,
Wait time-time that the costumer has to wait since the order was placed, and Point to point time-the time it takes an item to be moved from one area to another area.
It is good to know that there is a formula for me to know how many items I need to produce on a daily basis to get to my goal, Customer demand-what I need to produce divided by Planned work time equals the pace that the operation has to move to meet the demand of the costumer, and also I can use it for an hour by hour what I need to produce.
One of the things that a company has to do is reduce its cost, because with less cost is more profit for the company, all costs can be categorized 1-Facilities,Utilities, and labor, 2-Inventory, 3-Business support, 4-Cost of goods to be sold.
There are revenue streams within the company, and the idea is to maximize as many viable streams as possible without incurring in substantial cost, cost are barriers to remove profit.
The idea is to maximize value added activities, focusing in minimizing no-value added activities; it is amazing to know that 70% to 95% is non value added activities.