Brad: So, the problem is that by using more time than estimated, there is less time left in the month to produce and ship the margin on subsequent jobs. Sometimes, what margin is shipped in total is less than the fixed costs for the month, and then there is a loss for...
POOGI Series
Theory of Constraints POOGI Part 56: We lost money on that job!
Cost accounting is alive and well in American business (and around the world really), even though it is an invalid, old technology. The continued—and unquestioned—use of cost accounting has led directly to the loss of competitiveness and long-term decline of American...
Theory of Constraints POOGI – Part 55: Yes, but… Negative Branch Reservation
We are continuing our series based on The Goal by Eliyahu M Goldratt and the Theory of Constraints. {This series was co-written with Brad Stillahn.} Dr. Lisa: Back to the process for handling a “yes, BUT”. We are saying “yes” to the solution, and the “BUT” is a...
Theory of Constraints POOGI – Part 54: Yes, but… The Value of Concerns and Objections cont.
Brad: You’re making the case for people expressing their concerns whenever a solution is presented? That this is a good thing? Doesn’t this slow down the whole process? If I have a good idea—and as a business owner, it goes without saying that all of my ideas are...
Theory of Constraints POOGI – Part 53: Yes, but… The Value of Concerns and Objections
Brad: Both as a business owner, and back when I worked for large companies, I have found a lot of negative people. Someone has a good idea, and then it seems like everyone has a “yes, but…” It’s irritating. Dr. Lisa: Particularly if it’s YOUR idea. In Theory of...
Theory of Constraints POOGI – Part 51
What's my business worth ... now? continued Brad: "What's happening on the deals that are getting done? Are there any new trends or any terms that we need to be aware of?" Bob: "Seller's are being required to participate by providing owner financing. Banks and the...
Theory of Constraints POOGI – Part 50
What's my business worth ... now? Recent events have affected the value of privately held companies, including machine shops. The market is different. Demand is different. Supply is different. Availability of credit is different. Buyer's taste for risk is different. ...
Theory of Constraints POOGI – Part 49
Do-it- yourself 'Viable Vision' continued ... Brad: "Most businesses find that their fixed costs increase nearly proportionately when sales increase. It seems that for ever $1 that sales increase, so do costs. How is this avoidable?" Dr Lisa: "Yes, and some...
Theory of Constraints POOGI – Part 48
Do-it- yourself 'Viable Vision' Brad: "If a business owner wanted to grow the bottom-line of their company at the fastest rate possible, what would he or she have to do? And is there a way for them to do it themselves? Dr. Lisa: "Get operations 'perfect', and...
Theory of Constraints POOGI – Part 47
Do you really think you can do it all yourself? continued Brad: "So, we agree on the problem. What's the direction of the solution? How can a small business owner get the talent they need to grow profitably?" Dr. Lisa: "Well, that depends. It is ultimately the...