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Productivity Business Model (PBM)

 27/05/2017
MCPD English
By Dr. Alin Posteucă

Cost reduction through Productivity Business Model (PBM): desire vs. ability

To achieve their vision and mission, the strategic goals of the companies are often perennial. Such goals refer to: (1) profit, (2) turnover and market share, (3) unit cost, (4) delivery time, (5) productivity, (6) quality, (7) new profitable products, (8) respect for the people.

Many managers often claim that cost reduction and productivity are among their main concerns and that setting their annual targets and identifying ways to achieve them are their major challenges. However, managers often focus almost entirely on operational activities to ensure planned deliveries. Profitability by cost reduction through consistent productivity is seen as a result and not as a goal continuously linked to market and strategies.

So, cost reduction through productivity is actually being met within companies? And if so, is this consistent, measurable and repeatable? Do companies have and use a Productivity Business Model (PBM) like the one in the figure below?

Image Source: Posteucă, A. & Sakamoto, S., 2017. Manufacturing Cost Policy Deployment (MCPD) and Methods Design Concept (MDC): The Path to Competitiveness, p.21, Productivity Press, Taylor & Francis, New York, USA.

 

 

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About

Strategic productivity and profitability consultant and researcher, Alin Posteucă, Ph.D., Ph.D. is transforming the way companies approach their strategic transformation. With over 20 years of management consulting experience, Posteucă has created effective concepts such as Strategic Kaizen, Takt Profit, KAIZENshiro Budgets and Costing. His research on production flow has led to innovative breakthroughs in strategic and operational productivity improvement.

Posteucă's investigation into typologies of losses and waste has identified feasible improvements that can achieve the ideal state of production flow, known as Synchronous Profitable Operations (SPO). His Takt Profit model allows the optimization of production planning, transforming profit per minute into objectives for strategic improvements achieved through Strategic Kaizen projects.

Posteucă's research has led to increased effectiveness in strategic improvements and has set the stage for future productivity in the world of manufacturing technology. He is laureate of the Romanian Academy of the "Traian Vuia" Prize, the highest scientific prize in Romania.