We hear a lot about productivity these days and it’s impact on being competitive. I believe this to be a mistaken relationship. Or better stated, an incomplete relationship. I am not saying that productivity is not important. It is just that production is only half of the equation. The other half is production control.

Production and production control are balanced against each other. The idea is to produce products and services to a production control target. For example, a business can say they need to produce 100 units per hour, or they can say they need to produce 100 units per hour that meet 100% of the targeted customer critical to quality specifications.

The result is that you may take a production line that can produce 200 units per hour if quality is not a concern, and tune it to produce 100 units per hour with no waste, rework or negative customer impact. I know what you are saying here. “My productivity is half of what it was and my costs are higher.” 

Is this really the case? Out of the 200 units originally produced, how many met customer specifications? How many of the 200 units had to be scrapped or reworked? How many inspectors, rework, and scrap removal dollars have been spent? How much market share did you lose because customer expectations were not met? The lack of quality will never save you money. It will always cost you more.

The trick to staying viable in a difficult economy is to remember that shoppers buy based upon perceived quality. Especially when their financial resources are  limited. No one wants to waste their money on a cheap, but ineffective, purchase.

The way to business success is by managing both production and production control. That is, to measure a process’s production capability by its ability to produce “at quality”. This enables a business to make capital and human investment decisions based upon a process’s true “customer” capability.