Performance Measurement

Why use Contribution Margin and Octane measures rather than Unit Costing when comparing options for operational change?

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Contribution Margin & Octane - Header Image

Activity Based Costing (ABC) has replaced older methods of cost accounting. Overheads are apportioned to products on the basis of how much of the overhead activities are actually required by the product. However, when comparing options for operational change we use Contribution Margin or Octane rather than Unit Cost (whether unit costs are derived from … Read more

What’s the difference between normal maintenance and reliability-centred maintenance?

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Normal Maintenance vs Reliability-Centered Maintenance - Header Image

Maintenance management can be something of a thankless job, not helped by the differences in how people define maintenance and reliability. In most cases the reliability of a factory is delegated to the maintenance manager however few can articulate the difference between reliability and maintenance. Even fewer can define the difference between normal maintenance and … Read more