Where Is Your Profitability Engineer
Go to any business and ask, "Who is responsible for generating profits?" You’ll typically get a limited number of answers. "Of course, it’s the boss" is the typical response. "The chief accountant or controller" is another common reply. While both "the boss" and the chief accountant are accountable for the company’s profit or loss, you may find that, in most companies, the profitability engineer is not the boss.
Go to any business and ask, “Who is responsible for generating profits?” You’ll typically get a limited number of answers. “Of course, it’s the boss” is the typical response. “The chief accountant or controller” is another common reply. While both “the boss” and the chief accountant are accountable for the company’s profit or loss, you may find that, in most companies, the profitability engineer is not the boss.
There is no doubt that accounting, financial and executive management personnel are experts in their respective fields, but seldom will you find the company’s profitability engineer working in these departments. In reality, these departments are the arbiters and scorekeepers, not the creators of a company’s profitability.
So, here’s a “Where’s Waldo?” look around your company to find out who your profitability engineer is, and where the heck he (or she) is.
In the CEO’s office: Nope. He’s probably not there, though he may be called in there from time to time to explain what’s really going on out in the shop. His explanation, at times, differs significantly from those of the foremen, operators and production planners. So if you ask if anyone has seen the profitability engineer in the CEO’s office, the secretary will probably say, “Well, he was here a minute ago.”
In accounting: Very seldom is the profitability engineer found in the accounting department. On the rare occasions that one is spotted in accounting, it’s usually to lobby for getting a check cut to ensure that supplies of project-critical tooling or material are released in time to keep a job running.
In the sales office: No. I’ve never ever heard a salesperson offer to increase the price to increase the profits. However, the sales department will call meetings to which the profitability engineer is invited. He seldom stays long, as there are many more critical issues for him to be working on elsewhere. He documents his work in the meeting, where it is blessed by the executives and the accountants. This leaves the sales guys wondering, “How am I going to sell this?” That, of course, is what they are paid to do.
In purchasing: “He was here not too long ago” is the answer from the purchasing department. He was checking on a delivery for a tool for a new project. Or, getting the latest material prices for the new quote he’s working on. Or, he was confirming that the last shipment of incoming raw material is the same spec as what was ordered, since the cycle time is up and tool life is deteriorating. Yes, the purchasing department is part of the natural range of the profitability engineer. However, he does not have a desk here.
Behind a desk: No, he’s not sitting behind a desk most of the time. However, I’m sure that your profitability engineer has a desk. It’s simply that he is so busy making sure the job is running the cycle time and quality it’s supposed to be running. He may have actually sat at the desk to develop the quote when it first came in, but chances are, you won’t find the profitability engineer sitting there very often.
Getting lectured by a foreman: No way. The true profitability engineer is the one communicating the standards to the foreman.
“We laid that job out at 6.2 seconds. Why are you running it at 8?” is a likely question the profitability engineer might ask the foreman.
Getting a sermon from the quality department: Nope, not in this lifetime. The profitability engineer knows the process and the part far better than the quality department’s gaging knows the part. Proper process engineering ensures that the parts will not have systemic errors that even the quality department can’t find, but that might result in leaks anyway. Now, the profitability engineer might be trying to persuade the department that it has to step up its surveillance here or there, but that’s a different story.
Out by the machine: The profitability engineer is more often here than anyplace else. If you are running CNCs, your programmer is your profitability engineer. Are the programs leisurely written, one axis traversing at a time, conservative tool rates (misguided efforts to cut tooling costs at the expense of lowest part production cost)? Or, are they marvels of multitasking, with multiple moves happening simultaneously because they took the time to visualize the paths and then “stoked the coal” to it? Are the programs pushing well beyond book rates (starting points at best), and are they using the full machine horsepower capacity? This is the true habitat of a process—uh—profitability engineer.
Maybe your shop is running cam-type automatics. Your profitability engineer is just as important here, ensuring that tolerances, tooling and machine/process capability are fairly matched to produce the part efficiently. Here is where you harvest the benefits of the profitability engineer’s experience—by knowing which tolerance requirements on the job you have to beat and how to do it—in order to ensure that the part is better than the print. If your profitability engineer is not extending himself by pushing all of the other areas of your company, you are leaving profits on the table.
Process engineering is profit engineering. This is where all of the organization’s activities transform to become cash flow. Process engineers, CNC programmers, project engineers—these are the job titles of the folks who leverage your company’s talents and assets into bold, gutsy, world-class processes for making precision products that ensure the flow of cash and profits to your enterprise.
So, when you’re looking for the profitability engineer in your shop, don’t go to that person’s desk. You’ll have a pretty long wait. Instead, put on your traveling shoes, and go observe your profitability engineer by navigating throughout his or her natural environment—everywhere in your company.