Pulp Fact, Not Fiction --Dickeson
We're talking throughput accounting. Now we understand how you can say that "idle labor isn't a sin, but idle materials are" and make sense. Shades of Eliyahu Goldratt! And, we discovered it all by simply shifting our business model to a paper-timing base instead of some fictional BHR timing and rates. Great Jehosophat, we've known this since the overweight, overburdened boy was put at the head of the line of march in Goldratt's "The Goal" back in the mid-'80s. We just hadn't figured out how to apply it to our printing businesses. What I'm suggesting is a way of applying Goldratt's principles to printing.
"It's the paper, stupid." Let's start tracking paper dwell-time in place of labor time. Anything that increases paper time is a constraint on cash-to-cash speed. If you decide to operate 16/5 (two shifts, five-day week), that's a decision that can add 88 hours to the paper time. If you decide to wait until all the cost sheets are in, add maybe 328 hours. If you let 30-day terms on receivables become 45 days, add 360 hours. Don't start berating press crews who took maybe two hours more to finish a job on-press than called for by production standards! What that added to paper time is peanuts.
Before spending $4 million for a new six-color press, look first to the dwell-time of paper that management imposes. Can you increase efficiency by changing those unconscious or semi-conscious decisions far more than you can increase it with that new press? First thing, take the decision out of that unconscious or semi-conscious state by supplying data that makes clear—makes sense—out of what we're really doing.
Get the Answers
How? You know the answer to that one. Lift those self-imposed constraints. Want to know why our printing industry has become overloaded with capacity? Look no further.