Manufacturing operations live or die at the convergence of people, process and the machines that do the work. Conventional wisdom is that cost reduction – via technology or processes (or both) – is the gateway to improving profit.
In a world where automation, AI and data analytics are the shiny new objects that can enable lower costs, it’s worth considering how some of the intrinsic elements and laws of physics and thermodynamics can help return balance and profitability to manufacturing operations that are struggling.
Cornerstone’s proprietary “FIT” methodology is built on that foundation, and it’s helping clients rapidly turn around underperforming businesses and optimize existing operations. Our FIT approach has helped improve domestic and international manufacturing operations for companies who need to fix troubled plants.
Follow the Physics
Let’s start with some foundational concepts: Money or other resources represent potential energy or “calories” that fuel the organization’s operations. This potential energy encompasses people, inventory, machinery and processes.
The Fundamental Intrinsic Theorem (FIT) is a holistic math and physics-based approach to maximizing performance and minimizing risk. Cornerstone developed this business system after working around the world to optimize manufacturing operations for major global manufacturers. We knew there was a better solution than just trying to cut your way to profitability.
At its core, FIT is aimed at improving the overall health of an organization, which ultimately drives improvement in cash flow and EBITDA while boosting customer satisfaction and personnel development. It also provides the systematic agility to adapt a business to its corresponding environment. Physics is harnessed in FIT to restore stability, velocity and profitability for an operation, often in 60 days or less.
Improve Operational Performance
There are 10 intrinsic orders that serve as a diagnostic lens to evaluate opportunities to improve operational performance. The main item to understand is time. Time is the most valuable resource within any system because it is finite – and once it’s gone it cannot be recovered.
The FIT process also manages and channels the entropy (waste) of the entire system. The second law of thermodynamics, a.k.a. The Entropy Law, demands that waste is produced as a byproduct of any work producing process—meaning there is waste in every system.
The key is to control the entropy by purposely managing it—even using it sometimes to maintain process balance and continuity. Unmanaged entropy poses unrelenting risk to any organization; entropy is the “frienemy.” From the time a system is activated, many of its elements are in decline and will ultimately reach a breaking point.
Following the physics, it’s impossible to eliminate all waste from the system, but FIT will often enable us to help convert misdirected energy flows into potential energy as part of optimizing the system. The FIT approach manages the overall flows of energy to optimize the value chain.
We always ask our clients to start the FIT approach with the following questions:
- What type of organism are you – what’s your purpose and place in the market?
- In what environment do you exist – what are the characteristics of that market (or markets)?
- What is your current organizational health?
- Are you achieving maximum value within your current environment?
It’s time to get FIT!
Our FIT approach – grounded in science – is hiding in plain sight as the key to managing for profit. By understanding and implementing FIT, we help businesses give themselves the tools to successfully navigate the manufacturing environment, now and in the future.
If you need to get your manufacturing operation back into balance or improve your business performance — in a single plant or across the enterprise — call Cornerstone today at 1-888-324-4808. Our FIT approach could be the solution you need to return your system to balance, high performance and profitable operations.
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