Thursday 14 November 2019

Business Head's dilemma: Profit or Growth ?


One of the dilemmas some of the small, emerging CEOs have is whether to focus more on profitability or looking for growth opportunities and scale up the business sales turnover.

The reason behind the dilemma is when the organization is small, most of the activities are directly monitored, executed by the business head and he/ she has direct control over profitability. They use to enjoy comfort. At the same time, there is an aspiration to grow big and also the fear of maintaining the same level of profitability and comfort. Because maintaining healthy profitability within a controlled environment is different from maintaining the same profitability when the organization is exposed to different customers, product lines, markets during the growth phase.

In my view, the business head should aspire and balance both profitability and growth for both short term survival and long term sustainability of the business.

Profitability is a measure of your efficiency, effectiveness and the excess cash will give a strength to take the organization to the next level. Whereas Growth, even though it seems to change management in the initial time, is required to generate more cash reserve for sustaining the business. when you ensure the higher or same comfortable profitability in a growth stage, that will help you to grow further into a new orbit. That is cycle and that is the nature of personal and business growth.

Hence both profitability and growth is required. There is no guarantee that the existing comfort or profitability is sustainable if the business is not exploring growth options.

Friday 8 November 2019

paradigm shift required on the role of operator in small, emerging organizations

In some of the small, emerging organizations, operators who are working in machines or assembly lines are still perceived as Unskilled, and capability is restricted to loading and unloading of components. The other aspects of machine operators like quality checking, machine basic conditions monitoring, tool setting, and parameter monitoring or adjustment are taken by other teams like quality functions, programmers, setters, maintenance crew, and so on.

Here, more than the operator's skill and development, the mindset of supervisors or shopfloor managers needs to be changed. They believe that if we ask more from the operator other than necessary loading and unloading activities, the operator will not do or leave the organization. 

The flipside of this scenario is the operator will soon lose interest in the job as he/she is not learning anything new other than loading/ unloading. For any human being, the inner desire is to learn and contribute and get recognized for the contribution.

when the operator is not given an opportunity to learn more about quality, setting, and machine, he feels the lack of learning and looks for alternative or sometimes accept the situation as it is and becomes complacent.

From an organization perspective, when we have many people responsible for ensuring quality of the product and process adherence, machine basic condition monitoring, the ownership is totally shifted to someone, and they are not fully accountable for the causes of poor quality or poor maintenance. And the cost of manpower also increases, and engagement to the product or process quality becomes low at the operator level. That becomes a waste for the organization.

Since the operator is close to the job, he must be made accountable for OUTPUT, QUALITY AND BASIC HOUSEKEEPING OF THE SURROUNDINGS AND MACHINE. 

when we made this condition as a rule and develop the operator as one point source for improvement, this will enable the operators to learn the skill about quality and machine basic requirements monitoring, and the organization also benefits from waste elimination and reduction.

The starting point is how the organization defining the roles and responsibilities of the operators and the change in the belief system that the operator is capable of developing the required skill if it is warranted.