Blog post: Do you want your manufacturing to be efficient or productive?
By Terri Foudray, ConvIOT CEO and Founder
Every company that makes things walks a like between efficiency and productivity. Even the largest and most sophisticated organizations use these terms interchangeably. But while they’re related, they have different definitions.
Let’s start with efficiency, which concerns QUALITY. The simplest definition is that there is a target or potential output, and efficiency is how close you come to that. A machine has the capacity to produce 10,000 gallons of something per hour, but it only produces 6,000, so it’s 60% efficient. So, the things that hurt efficiency at a manufacturer are things like downtime, hiccups in the supply chain, waste, low quality, and other things. Efficiency is all about working smarter, to get more out of less.
Productivity, on the other hand, is a measure of the total output in a given amount of time, or QUANTITY. Using the example above, a machine is more productive if it can make 10,000 gallons per hour, but you find a way to make 11,000. Efficiency is a component of productivity, but productivity about increasing the overall yield, achieve greater results.
Michael Mankins, Partner #Bain&Company said in #HarvardBusinessReview “Great companies obsess over productivity, not efficiency.” But I have to disagree. Clearly both productivity and efficiency matter. But in most businesses, particularly those in traditional manufacturing, having productivity without efficiency is a sure way to kill the business.
What if you had a platform that could drive both efficiency and productivity? What it takes is as an always-on “Management Sherpa” for seeing, learning and acting to manage your factory floor in real time and preemptively. This would address the efficiency aspect. And with such a tool you’ll be able to run your processes better with less waste, less unplanned downtime, and better quality/safety. And you’ll be able to run your business better – more productivity – through unified control and easy-to-use tools for better decisions. This takes both #EdgeComputing and #Cloud.
Just coincidently, this is exactly what ConvIOT does. Run your processes more efficiency, and get the insights you need get more out of what you already have. To learn more, send me an email at info@ConvIOT.com.