How to Prevent Everyday Profit Margin Waste: Actionable Tips
Recently, during my travels, I encountered an unexpected flight delay at Amsterdam airport that shed light on a significant issue: preventable profit margin waste. The scene was all too familiar – interminable queues at check-in counters, exacerbated by a glaring shortage of personnel. As a consequence, I, along with numerous fellow passengers, missed our flights. This setback led to a frustrating 10-hour wait before rebooking for the following day and prompted my contemplation about the avoidable loss incurred by the airline.
Amidst the collective inconvenience, it struck me that had effective measures been in place to prevent profit margin waste; the airline could have reaped substantial benefits. By optimizing operational efficiency, not only could the original flight have taken off with a full complement of passengers, but the replacement flight could have accommodated additional travelers, bolstering profits in the process.
This experience made me see how easily a company can lose profit and reminded me of a book I read long ago called Six Sigma Simplified by Jay Arthur. This book talks about a tale of two factories.
According to Jay Arthur, every business has two “factories” running simultaneously:
- The “Good Factory” is where you focus most of your energy