Covered wagon, Medicine Show
Take you to a place where the healing flows, oh-ho
Weak in spirit we got the juice
Won’t save your soul it’ll shine your shoes, oh
…
Don’t be fooled by imitation
This is the stuff that cured a nation
…
Immunity from ridicule
Improves your brains if you’re a fool, oh-ho
And I read in the Middle East
Traded some for a hostage release
Now if you’re bald it’ll give you hair
– lyrics from Big Audio Dynamite’s Medicine Show
“There’s no silver bullet, magic medicine, no miraculous cure” – perfectly sums up the reality of production optimization. No single strategy solves all challenges; the best approach depends on your organization’s priorities, goals, and market demands. Here’s an overview of the main strategies and when they might be best applied:
1. On-Time Delivery
- Best for: Businesses with strict deadlines, contractual obligations, or industries where delays can lead to significant penalties or customer dissatisfaction (e.g., construction, healthcare supplies, or perishable goods).
- Focus: Meeting delivery dates by ensuring production schedules are maintained, even if it sacrifices efficiency or increases costs.
- Key Metrics: On-time delivery rate, cycle time, and customer satisfaction.
2. Maximizing Production Output
- Best for: Companies with high demand and limited production capacity, or in industries where economies of scale are critical (e.g., automotive manufacturing or commodity production).
- Focus: Maximizing throughput, often through reduced downtime, lean processes, and optimizing bottlenecks.
- Key Metrics: Overall Equipment Effectiveness (OEE), units produced per hour/day, and downtime percentage.
3. Highest Margin Overall
- Best for: Businesses focused on profitability over volume, such as those offering customized or premium products (e.g., luxury goods or high-tech components).
- Focus: Producing higher-margin items, which might mean lower volume but greater profitability per unit.
- Key Metrics: Gross margin, profit per unit, and cost efficiency.
Balancing Priorities
In reality, most companies balance these goals rather than focusing exclusively on one. The optimal strategy depends on:
- Market dynamics: Are customers more sensitive to time, cost, or availability?
- Capacity and constraints: Can you afford to focus on one metric without sacrificing others?
- Business goals: Are you scaling up, maintaining market share, or protecting margins?
A deep understanding of the business and customers is required to make real progress in optimization. It’s easy to get a local maximum, but this leaves a lot of room for improvement. A holistic, focused and continuous effort is required to reach global system wide maximum efficiency that prioritize the needs of the business and the customers.
Would you like advice on how to evaluate which approach fits your current operations, or tools to help analyze your production priorities?
