Monday, March 10, 2003

Throughput Accounting, take 2

I wrote at some length on Saturday night about the flow of revenue. In reality, the story of the oil change and the car wash illustrate far more than just the flow of dollars.

The stories illustrate constraints, exploiting constraints (and not), metrics, decision making, preventative maintainance, continuous improvement and team building. I could go on about each. And so could you.

For example, one Alert Reader correctly calculated that I paid $44 for an oil change on Saturday. "Too Much!" he exclaimed. Perhaps. But think about it with me. I got synthetic oil to keep my 106,000 mile Saturn running well. (I have a target of 180,000 miles for my little home away from home for over an hour a day.) I got in and out quickly with no hassle. Does Jiffy Lube's speed and convenience earn them a premium? Probably. Did I quibble with Dwayne? Nope. He made good value.

More importantly though, the stories simply remind me that examples of systems abound in what we see daily, both within and without of work. I can learn from any of them. I write up what I'm learning here. I hope you find it helpful as well.

Feel free to forward to a friend. Email me

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