As the statement say for itself, optimization should be a wholesome and broad based activity. Optimizing one aspect/unit/area will only create more bottlenecks.
Imagine a manufacturing company that produces toy ducks and ships it to retailers. It has a production unit and a storage facility. Say it produces 1000 toys a month with the present way of working. This is optimized say via agile and now they ship out 300 toys a week. This means their monthly production is now 1200 toys a month. This is good.
However, the same optimization was not applied to the storage facility. It was designed to handle 1000 ducks at the end of each month. In the new process it is handling 300 ducks a week but it would mean that this facility is under utilizing itself. It is still paying high storage costs without using the storage. So the gain from production is somehow neutralized by the cost of resource under-utilization.
It is said that a chain is only as strong as it's weakest link. Same is try for organizations. Strengthening or optimizing one component is not as beneficial as smaller optimizations in the whole system.
Reference:
(1). https://blog.deming.org/2016/11/optimize-the-overall-system-not-the-individual-components/
Subscribe to:
Post Comments (Atom)
Portfolio management turns investments into capabilities
Organizational capability is directly linked with value and benefits. So, the purpose is to turn investments into value. Once an investm...
-
Part of the capacity and capability management revolves around human resources. To fulfil the vision and strategies of an organisation, ...
-
One thing that sometimes bother me in the lack of clear and crisp feedback from senior management. To keep an employee or a project team mo...
-
The hardest part about risk management is that it is a perception. It is one’s own view of factors that can affect the progress. Since t...
No comments:
Post a Comment