CFO to CEO: “I don’t know. I’m beginning to suspect that this lean stuff isn’t real."
If I had a dollar for every time that I have been told about conversations like that, I’d be rich. And it demonstrates that most CEO’s and CFO’s don’t really understand what productivity is. I believe this is because their accounting systems focus on “labor efficiency”…the relationship of actual labor hours vs. standard labor hours, with the erroneous presumption that the standards are correct. Their systems don’t even try to measure productivity.