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Hi,
I was looking at questions Dec’13 Q2a and Dec’11 Q2c and I noticed that suggested answers to both questions evaluate differently company’s performance using the Pyramid
Dec’13 answer starts from talking about Corporate vision and company objectives and then goes on to make comments about the second level Market and Financial
Dec’11 it seems leaves out Corporate, Market and Financial and goes to talk about Cust. service, Flexibility, etc
My question is how do I know where to start: from Corporate or Tactical level?
Thank you
It depends a little on the question, bit it seems to me that models come as complete approaches and that it is dangerous not to apply them as fully as possible.
Vision and objectives need to be considered before you know, for example, what is meant by customer service. In some organisations customer service might primarily mean low cost per unit; in others is might mean excellent quality and very short delivery times.
I will keep that in mind as it seems correct to mention vision, otherwise the rest is left with no context.
Could I ask what measures should we apply for Waste – is waste about reducing non value adding activities? How then to measure that?
Also, would Revenue increase be appropriate to measuring Market or Financial dimension? It seems that could be applied to both, would that be correct?
Thank you
Yes, waste is about reducing non-value added activities as well as conventional wastage of material, and labour time.
How you measure it depends on what it is:
Material – weight
Time – use time sheets
Inventory – cost of maintaining inventory
Reworking – time and material needed to rework/scrap.Revenue is a way of measuring both, but would not stand alone. Almost any fool can increase revenue, but increasing profit might be more important. Therefore financial needs costs and return on investment measures too.
Similarly, market share (and recenue) can be bought. It would also be important to measure repeat business, customer satisfaction, average spend etc to get a balanced picture.
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