Throughput

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What is “Throughput”?

“However beautiful the strategy, you should occasionally look at the results.” — Winston Churchill, prime minister of Great Britain during World War II

Key Points:

• Throughput is the rate at which a system achieves its desired goal. It’s the measure of effectiveness of your Value Stream.
• It’s measured in the form of rate/time: the higher the rate and the lower the time, the higher the throughput.
• To measure it you need clearly defined objectives:
  
  
  
  • Dollar Throughput is a measure of how quickly your business creates a dollar of profit.
  • Unit Throughput is a measure of how much time it takes to create an extra unit to sale.
  • Satisfaction Throughput is a measure of how much time it takes to create a happy customer.
• By improving the process you create and deliver value, you will improve quality and customer satisfaction.

Questions for Consideration:

• Based on what you’re offering, what is your current dollar / unit / satisfaction throughput?
• What appears to be slowing down your value delivery system?

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