Jarmo Manninen & Muutosdraiveri Oy
Achieving the company's financial goals must be based on PROFITABLE GROWTH, which requires that the company's financial management conditions are in order. When a company has the financial management conditions in order, this practically means that the company knows what results the company can achieve with its current investments and current products and services.
In the following, I will examine the company's production function from the perspective of the financial management of a company.
In my terminology, production occurs in all companies, not just companies that manufacture something. For example, in a shoe store, purchasing shoes for sale is production. In companies that manufacture products, production includes all procurement, subcontracting, manufacturing, logistics and maintenance of manufacturing machines. In companies that produce services, all procurement and subcontracting are production. Internally, the customer of production is sales, and the external customer is the customer who buys the company's products and services. The company's production objective is to deliver all products sold by the company's sales so that the efficiency and cost-effectiveness of production operations correspond to the objectives defined for the company's production in the budgeting.
If, in exceptional cases, other objectives are defined for production operations and cost-effectiveness in order to obtain individual deals, these must be agreed with production during the offer phase before the deals are agreed. Production must also be able to implement these objectives agreed in exceptional cases. In order for the company to achieve its profit targets with the best possible results, this requires excellent cooperation between sales and production. This means understanding that crosses the boundaries of functions. In other words, production must train sales to understand what and under what conditions sales can make promises to customers on behalf of production. And on the other hand, sales must train production to understand how production must be able to develop its operations to enable it to obtain deals in the future.
Did this interest you?
I encourage you to share this blog post of mine on social media. If you have any suggestions for the topics of the next blog posts, I will gladly accept them.
I hope that you were interested in this matter and that you can continue to be involved.
I have written four books on creating the conditions for the company's financial management, and they are available in well-stocked bookstores and online bookstores in Finland, for example from BoD (Books On Demand) at:
https://kirjakauppa.bod.fi/catalogsearch/result/?q=jarmo+manninen
Muutosdraiveri Oy &
Jarmo Manninen