If being more productive, or getting your team, group, company, or organization to be more productive seems harder these days, you are not alone. Annual productivity improvement has slowed to about 1% from its most recent peak of almost 6% in the early 2000’s.
In McKinsey’s recent article “Pushing manufacturing productivity to the max,” Robert Feldman et. al. suggests that the manufacturer’s dream should be a continuous, real-time data stream. He paints a picture of operators referencing data dashboards that flash alarms when a metric is out of spec, with “profit per hour” at the forefront of these metrics. If you asked McKinsey’s Feldman if there was ever a limit to how much data is helpful, it seems he would say no. But is there such a limit?
The ongoing price war between Amazon, Walmart, and other consumer goods retailers is great for the consumer, but tough for the Consumer Packaged Goods (CPG) industry. If you are a CPG company, you have already spent the past few decades constantly pushing prices down. And yet the price war will demand even more savings from you in the years to come. There are some more obvious places to look for these savings, as well as a hidden one that you might not initially consider, and which may hold the greatest promise. Let’s go through all the options together, as more opportunities on your plate will give you more options to respond.
Congress is considering using a Border Adjustment Tax to increase the financial incentives to produce goods in the United States. If successful, demand would significantly increase for US-made products.. Most US manufacturers would likely benefit in some way over the long term, but some would win much more than others. The biggest winners will be those that are able to find and utilize excess capacity in their existing operations.
If you are an investor, where should you look to find those manufacturers who are best positioned to tap into excess capacity and become the biggest winners?
A Border Adjustment Tax (BAT) in any proposed new United States tax code has the potential to create significant winners and losers in a rapidly-changing domestic manufacturing market. Its proponents claim that the border adjustment tax will help rebuild US manufacturing--and hopefully the jobs that go with it--by creating pricing incentives to build products in (and export from) the US rather than import them.
How can a manufacturing business get the most out of a Border Adjustment Tax, and who will the biggest winners be?
Mark Rosenbaum, Partner at Stroud, spoke to delivering more when visible opportunities and trade-offs are exhausted or insufficient at the World Heavy Oil Congress on 26 March 2015.
Commodity producers are not strangers to the pressures of price cycles. You understand the need to drive efficient and effective operations and have invested accordingly. Over the last decades, most businesses have adopted best practices through benchmarking, Lean Six Sigma, and other improvement efforts. This has raised performance, eradicated visible waste, and left many wondering if significant potential for improvement remains.
Times are tough right now for miners and energy producers. China’s economy, as well as many others, have slowed and commodity prices are at their lowest level in almost a decade. Once healthy margins are tight or have vanished altogether, projects that met hurdle rates are less attractive or viewed as nonviable, and long-term plans are being questioned.