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Capability trumps output

Posted by Stephen Parry on Nov 5, 2014 2:34:29 PM

IMG_0802In the mass-production world, the performance of individuals and departments can be determined by measuring their output – how many items produced, sold, or shipped.

Much more important, however, is what those individuals and departments are capable of doing: do they have the means of production and what is the capability of the operation? It is actually much more productive for managers to spend time developing the capability of their organisation than in trying to push to meet production targets.

Whereas in a mass-production scenario people and departments are measured by their output, in the Customer Value Enterprise® performance is measured in terms of  capability.

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Capability of means is more important than output. For example, if you were asked to drive 50 miles on gallon of fuel and your car was only capable of doing 30 miles per gallon, you might as well cancel the trip.

As you can see, the ability to measure capability is far more important than the ability to measure output.

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