MeasureProductivity

In the post crisis economy competition in the markets is very tough.  Businesses cut expenses as much as they can.  Indeed it is unacceptable to waste money in the situation when finding new customers and keeping existing ones is very problematic.  That’s why business should function in as efficient way as possible.

What is the best way to see whether not the business is efficient?  Of course, it should be constantly monitored and evaluated.  Business evaluation mostly concerned measurement of financial indicators.  But these times are gone.  With the emergence of balanced scorecard it became understood that in order to improve financial indicators one should improve operational management.  On top of that, the company should necessarily have a comprehensive strategy.  Without a clear strategy it is impossible to achieve success.  This is like driving a car with the eyes closed.  You never know where you get in the next minute.

Major BSC implementation stages

Balanced scorecard helps in measurement of business productivity through evaluation of KPIs (key performance indicators) thus, linking company strategic vision with its operational management.  Balanced scorecard implementation is not as easy as it might seem at a first glance.  Lots of mistakes are made by managers when implementing and maintaining of this system.  These mistakes are quite typical and so they can be easily avoided.

One of the most common mistakes is thinking that balanced scorecard is a magic tool that can easily make an ordinary company into the most successful international business.  Well, this is not so.  Balanced scorecard is just a tool in the hands of people.  This leads to the second mistake which is lack of human resources.

Sometimes company starts implementing balanced scorecard without having people who are responsible for this.  It often happens that managers and ordinary employees are not interested to collect data and analyze it.  The personnel needs to be able to understand the company strategy and the way balanced scorecard works.  Without such understanding it would be extremely difficult if not impossible to gain positive results.

The most serious mistake is implementing balanced scorecard without a clear strategy.  In such a way BSC will fail and remain just a useless pile of documents and a headache for the personnel.

It is also important to find the right KPIs to be evaluated.  It is equally important to have the right number of them that each managerial level.

When all conditions are observed and no mistakes are made balanced scorecard turns into a great tool to measure business performance and productivity which approaches the company to reaching of strategic goals.

Avoid these mistakes

This article discusses the different ways by which factories determine their Benchmarks for productivity. It also discusses areas outside the Factory Floor that these benchmarks can be used.

A few people would say that the factory industry is all but dead or dying in the United States of America and that the few that remain are the big corporations that are able to compete with the prices of imports. The fact is, factories are still very much present in the United States. Those that are currently present may not be like the old car assembly lines propagated by the great Henry Ford (most of those types of factories have moved out of the United States and into Asian or European Countries). No matter what the population of factories in the US today, they still use productivity metrics and benchmarks to determine their progress. It is also important to note that Factory productivity benchmarks are no longer just for the factory floor, but also for other services and jobs that produce output in relation to time spent performing them.

Factory Benchmarks are one of the easiest benchmarks to determine. It is easy because factories work on the output principle and productivity can easily be determined by the amount that a worker churns out in a given amount of time. Factory benchmarks may either be individual benchmarks involving one employee at a time or it may be a benchmark for the company as a whole. Output is not the only kind of productivity benchmark that factories live by; it wholly depends on company goals and objectives.

The Millionth or the Billionth unit produced in a given time span may be considered by a factory as their productivity benchmark or its gauge for success. But, again, this factor solely depends on what a company views as success. Some factories view the period where they remained accident free as their productivity benchmark. While others may consider the percentage of products imported or exported as a sign of success. Still some factories may take the individual output of their workers into consideration when determining success benchmarks. The types may be unending and differ greatly depending on what a company is and what it considers productive.

Factory Productivity Benchmarks are not only limited to the factory floor. It can also be used to determine success in office work. The number of invoices prepared by an individual may be seen as benchmark of productivity. In a lawyer’s case, it may take the form of how many cases he/she handled in the past year. For an ER doctor, it could stand for the number of sutures she had done in a span of 12 hours. Productivity Benchmarks for factories may be used in any other area as long as it is tweaked and adapted to whatever goals are set for that market.

As have been presented, it is now clear that benchmarks used to determine productivity in the Factory floor differ depending on what the company stands for or believes in. It may take the shape of employee output or accident free days. It has also been stated that Productivity Benchmarks found to be effective in Factories can also be relevant in other fields.