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Factory Physics for Managers: How Leaders Improve Performance in a Post-Lean Six Sigma World
book

Factory Physics for Managers: How Leaders Improve Performance in a Post-Lean Six Sigma World

by Edward S. Pound, Jeffrey H. Bell, Mark L. Spearman
April 2014
Intermediate to advanced content levelIntermediate to advanced
304 pages
10h 1m
English
McGraw-Hill
Content preview from Factory Physics for Managers: How Leaders Improve Performance in a Post-Lean Six Sigma World

CHAPTER 5

Profit, Cash Flow, and Factory Physics Science

The ultimate measures for business are profit and cash. The Factory Physics approach has a direct impact on profit and cash, as reflected in traditional financial statements. While Factory Physics is primarily a theory of operations behavior, it can also be viewed in one sense as a theory of cash flow, profit, and return on assets. The buffers of inventory, capacity, and time and the demand-stock-production (DSP) framework essentially correspond to the financial resources of a company. Consequently, the key elements of the Factory Physics framework tie into the income statement, balance sheet, and cash-flow statement. Those ties are the topic of discussion of this chapter. For example, ...

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Publisher Resources

ISBN: 9780071822503