(Mfg.) Box Scores

Description:

If managing a business was as easy as pushing a dollar and generating $ 1 anyone could do it.  But life within businesses is much more complex.  Within business accounting, financial metrics are based upon standards and variances to those standards and usually they don’t provide clear direction on how to be more productive.  These metrics are almost always lagging indicators and don’t assist in daily decision making.  In addition, the P&L statements are typically non-descriptive of the real cost drivers of conversion margin and conversion cost.


Box scores allow a value stream to publish a ‘weekly P&L’ that is built off of actual costs, actual production units

Completely new questions on ‘how can we be more profitable’ are asked … every week


Let TGG work with your team to implement Lean accounting and box scores and your organization will a) understand the real cost drivers, and because of this b) start making different operational decisions.

An example of weekly box score components to provide an example of how labor, machines, materials, facilities and other costs are incorporated into the score.

1.0 Operational metrics:

– Sales per person
– Stock outs
– Scrap
– Dock to dock days
– Average cost

2.0 Capacity

– Productive capacity
– Non productive capacity
– Available capacity

3.0 Financials

– Revenue
– Material costs
– Employee costs
– Machine costs
– Utilities
– Other costs
– Facility
– Total costs

– Value stream profit
– Return on sales
– Inventory value
– Cash flow

Easier, faster, safer, better, cheaper and more profitable.  That’s the organization that understands Lean accounting.

Duration:

3 days SCO
10 days RUN
3 days Evaluate

Typical Outcomes:

  • Identified value streams
  • Build, train, and implement box scores
  • Calculate with little to no allocations or variances
  • Control and reduce costs

Define your Problem Statement.

The first step towards breaking your organizational log jams is identifying and verbalizing the challenge you're facing. What are you trying to solve? This simple Problem Statement exercise can have profound implications for your team. It helps you define the issue and gives TGG some sense of where the soft spots could be in your Order to Cash process. We invite you to take a few moments to fill out this form. A TGG consultant will contact you shortly to discuss your Problem Statement and provide some insight on how we may be able to help.

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