5 of the Most Difficult Questions Every Manufacturer Needs to Ask at Year’s End
Manufacturers face tough questions every day. It takes a special kind of problem-solving capability to operate a modern factory. But the end of the year brings an even tougher set of questions to the forefront for every business. Specifically, the kinds of questions that make you assess current operations, set future goals, and figure out how to connect the dots between them. As we approach the end of 2019, it’s time to face the tough questions before 2020 arrives.
Although these questions will look different for every manufacturer, they’re essentially the same in meaning. The premise is to map a path to continued success by looking at where you are, where you should be, where you want to be, and how to get there. Here’s a look at the five questions from a baseline standpoint:
- Did you accomplish your goals in 2019? Look at the metric you use to measure your operations and performance. Did you hit the mark or miss it this year? What factors played a role in your success or failure? It’s crucial to determine where you stand because it’s the starting point for where you’ll go. If you met your goals, use the same formula you did last year to plot new ones. If you fell short, look at the reason why and account for this in your planning for the upcoming year.
- What are your operational goals for 2020? Every manufacturer has the same goals of turning a higher profit or expanding capacity — but these are generic. You need to pinpoint your specific operational goals and make them granular. How do you plan on increasing capacity? What do you need to do to improve revenue? Specificity is the key to charting success in the coming year. And, don’t set goals you know you’ll attain — set ones you’ll have to strive to meet.
- Where are there cost optimization opportunities? How can you do what you’re already doing, but more efficiently? That’s the essence of this question and one that’s important to continually ask. Extra cost is indicative of waste. If you see extra costs, look at it as an opportunity for improvement. Whether you assess it from a cost standpoint or a process efficiency stance, the result is the same: Cost savings and improved efficiency.
- How can you optimize your workforce? Your workforce is the most important part of your factory, and it’s worth special consideration as a standalone question. What do you need to give your workers to improve their abilities? Better training and education? Hire more employees to mitigate capacity? Change your scheduling to fight burnout? Look for ways to help your people in the coming year and you’ll be rewarded with better odds in meeting your goals.
- What does your balance sheet look like? Everything comes back to the balance sheet. Is yours healthy? If you have debt, ask yourself what you can do about it and what it’s hindering you from doing. If you have a surplus, how can you put that cash to work for your business in 2020? If you’re teetering back and forth each month, how do you add stability?
There’s a high likelihood you’ll encounter some harsh truths and difficult answers in probing these questions. That’s the signal you’re doing your due diligence in answering them. They’re not easy to ask, but they’re necessary to evaluate your factory and attain manufacturing excellence in the coming year.