About this Presentation
Throughput accounting is a significant innovation, breaking the paradigm of cost-world thinking and leads to throughput-world thinking. Even within the TOC community itself, throughput accounting has not been as widely adopted as it should be. One aspect of throughput accounting that is underappreciated is its value when applied to pricing and product mix decisions. Based on implementations, Beau and Brad have recognized that when throughput accounting is applied to pricing and product mix decisions, bottom lines tend to improve – and quickly – like going from breakeven to a 10 percentage point return-on-sales (or from 5 to 15 percentage point) in less than a year. Incredible! The breakthrough occurs when pricing decisions are based on margin and time, not cost. Anyone who understands throughput accounting realizes that the flow of margin in a company is THE critical factor in delivering profits to the bottom-line. Yet, traditional cost accounting pricing methods ignore this fact and have left millions, if not trillions on the table. Video length: . PDF: slides.
What Will You Learn
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