Real Productivity Growth
I am often asked by managers and practitioners where to start the approach to increasing productivity for profitability, especially now in times of crisis. They expect me to say that it starts with defining the customer value, then identifying waste at the level of operations and then making improvements to the current way of working to reduce / eliminate waste.
In fact, the approach to real productivity growth starts with a full awareness of the opportunity to increase productivity (a productivity improvement feasibility study). Then it is necessary to design an effective working Method (M) to prevent the occurrence of waste (based on a deep understanding of the current and future needs of the company). Then it is necessary to define and master the Performance (P) of the designed working method (definition of Standard Operating Procedure – SOP). Then, in the end, a stable production planning (Utilization – U) can be made, based on an effective working method and a performance of the working method without significant fluctuations.
This is the Japanese thinking of real productivity growth: