Operational Excellence: Optimizing Resource Flow for Productivity and Profit

Sean Hart, Chief Executive Officer And Managing Partner, POWERS

Resource flow is what keeps a manufacturing operation humming. When raw materials, labor, capital, energy, technology, data, and information move smoothly, your plant delivers—productivity soars, costs shrink, and profits climb. But when they get stuck, you’re losing value. Our focus this month is on optimizing resource flow, ensuring that every element contributes its share to drive results.

At POWERS, we’ve seen manufacturers reverse inefficiencies into major gains by zeroing in on flow.

Let’s dive into practical ways to spot where resources stall, from quick checks to robust tools like Value Stream Mapping, and why this matters for your bottom line.

Why Flow Drives Value

Why care about flow? When resources don’t move well, you’re stuck with waste—piles of inventory, idle workers, unused machines, or energy spent on redundant tasks. Studies show poor material flow can lock up 20% of a plant’s working capital in excess stock. Optimizing flow flips this, boosting productivity and profit. Streamlining material handling can cut lead times by 30%, improving throughput and customer satisfaction. Flow isn’t just about moving faster; it’s about aligning resources to create value, not burn it.

Spot Bottlenecks with a Gemba Walk

Start with the basics: walk your plant to see where things slow down. Look at raw materials—are they sitting too long in storage? Check labor—are workers waiting for parts or approvals? Examine capital—are machines idle due to poor scheduling? Monitor energy—are systems running when they don’t need to? Assess technology, data, and information—are outdated tools or delayed reports holding up decisions? This hands-on approach, often referred to as a Gemba walk, quickly identifies bottlenecks and areas for improvement.

One plant manager’s walk revealed a 2-hour daily delay in material transfers, resulting in an annual cost of $500,000.

Fix these—reorganize storage, tweak schedules, speed up data—and you’ll see results quickly.

Measure Cycle Times for Quick Insights

Another straightforward method is measuring cycle times. Time each step, from receiving raw materials to shipping products. If one stage lags—say, quality checks take twice as long as assembly—you’ve got a problem. A packaging firm cut inspection delays by 25% after timing their process, saving $1 million annually. You can begin with simple tools like stopwatches or spreadsheets. These steps—walking the floor and timing processes—give you a clear view of flow without major effort.

Unlock Deeper Gains with Value Stream Mapping

For greater gains, consider Value Stream Mapping (VSM), a more in-depth yet powerful approach. VSM outlines every step, from raw materials to finished goods, illustrating how resources are utilized and interact with one another. It tracks material movement, labor utilization, capital efficiency, energy consumption, and the flow of technology, data, and information—such as order processing or system updates. Unlike quick checks, VSM requires a team—comprising operations, supply chain, and IT—and a significant time investment to map. It’s like a detailed diagnostic, revealing waste such as excess inventory or data delays.

We employed this process with a $400 million automotive supplier we partnered with to uncover $2 million in output lost to overstocked parts, then trimmed inventory by 15%.

Diagnose and Fix with VSM’s Insights

VSM shines by showing why bottlenecks happen—maybe a sluggish data system delays material orders or inefficient setups waste energy. One manufacturer slashed lead times by 40% by tightening information flow. To build a VSM, map the current process: every step, time, and resource. Then, sketch a future state, targeting fixes like just-in-time material delivery or faster data reporting. VSM takes time but pays off big—a plant boosted OEE by 12% after mapping, adding $3 million in value yearly.

Supercharge VSM with POWERS’ MOS

At POWERS, we take VSM further with our Management Operating System (MOS), a practical framework that maps your entire manufacturing process—raw materials, labor, capital, energy, technology, data, information—and identifies inefficiencies, waste, or profit leaks. Our MOS process provides a clear picture of your current state and then guides targeted improvements for immediate gains, such as reducing inventory or streamlining data flow. We leave clients with a comprehensive MOS blueprint to drive continuous improvement, which translates directly into increased profit. DPS, our Digital Production System, sustains these gains by providing real-time data and analysis of critical KPIs—such as uptime, inventory turns, and throughput—to keep your operation at peak performance.

Act Now, Win Big

Whether simple or complex, the key is to act. Use Gemba walks or cycle times to address quick fixes—such as a $500,000 material delay or a $1 million inspection snag. When ready, deploy VSM for systemic wins, like $2 million in inventory savings. Pair these with real-time monitoring of uptime, inventory, or energy use to lock in gains.

A $500 million consumer goods firm we worked with achieved a $4 million throughput boost by maintaining a tight flow. Consistent optimization can reduce costs by 20% over time, according to industry research.

Optimizing resource flow is about staying focused and maintaining a clear vision. Keep raw materials, labor, capital, energy, technology, data, and information aligned to deliver value. Start small, scale up, and watch productivity and profits grow.

About POWERS

At POWERS, we help manufacturers achieve operational excellence by optimizing resource flow, enhancing workforce efficiency, and streamlining processes. DPS, our Digital Production System, provides the essential tools for real-time data and analysis, enabling your team to capture, sustain, and scale performance gains across your entire enterprise. Ready to elevate your operation? Let’s talk.