ABSTRACT

Profitability is better – it is the return on resources that creates those hard dollars. Profitability keeps businesses sustainable and enables companies to reinvest or distribute wealth to owners. Profit is an outcome of Revenue minus Cost; these dimensions need to be taught or reskilled in organizations. RCP is a strategic and operational tool to highlight, track, and systematically connect performance indicators to profit. This tool ensures implications are understood and the full range of levers within a P&L owner's decision-making arsenal are considered to optimize Profitability. Many employees believe the things as Scrap Rate Reporting, Labor Variances and Volume indicators are just plucked from the sky of options – rather than understanding the executive team has deliberately selected these indicators to monitor and manage because they are an important part of the system of activities that makes the company profit.