I just had a call from a client who owns a make-to-order manufacturing firm (building materials) in New Zealand.
Chris was agitated because he had just realised that, last week, across his sales team, 20 appointment slots had gone unfilled, due either to cancellations or a failure to schedule appointments.
He had calculated that these empty slots had cost him (conservatively) $16,000.
Chris now wants to do “whatever it takes” to ensure that these (occasional)holes are plugged.
I’ve got to say that it’s so gratifying to hear an executive complain about lost Throughput. (Most are way too busy obsessing about ways to shave operating expenses.)
Tell me, were your salespeople fully loaded with business- development appointments last week? If they performed 20 or less each, have you calculated the opportunity cost of their under-utilisation?
I suspect the opportunity cost dwarfs whatever operating expenses you might need to incur to shift the constraint firmly to your sales team.
(Disclaimer: obviously, this comment doesn’t apply if you are deliberately maintaining production or NPD as your system constraint.)
