Direct your improvement initiatives toward the right areas
If you’re looking to improve your business the first area that requires your attention is obviously the worst performing one. Except, it’s absolutely not; it should be your best performing.
The machine or the department that is constantly busy and turning out a reasonably high output must be heavily loaded by definition – that’s your bottleneck, that’s where improvement needs to be made. Any improvement on a non-bottleneck is a waste of time and money as it won’t correlate to business improvement. It’s important not to lose sight of the goal of your business – to make money!
It can be tough to press for improvement on an area which already appears to be doing well. Higher management might rant and rave about non-performing equipment – it’s easy to measure the performance of non-bottlenecks and make improvements, often accountants will back the ventures as you’ll appear to be saving costs. You might be saving one department money, but you need to be thinking of the business as a whole. Product flowing through a dependent system can only go as quickly as the system’s bottleneck will allow. So, speed up the flow through the bottleneck first! Increasing the output of other departments will only result in more queues and increase the risk of longer lead times. Making improvements to your bottleneck will reduce the overall lead time which could lead to business benefits such as charging premiums for fast turnarounds.
Operations managers often avoid improving their bottlenecks as it’s more difficult than the alternatives but any improvement on a bottleneck – no matter how small – will always be more helpful than an improvement on a non-bottleneck. So, if you’re looking to grow your business the place to start is not developing your poorest performing department as you might have first thought. Go straight to your best performing department and see if you can make it even better! Then once you have increased the output of your bottleneck, you can look for your next bottleneck.