Knowing Your Upside Potential defines the gap for improvement.

A perfect world scenario reveals the upper most limits of what is possible to achieve:
1) Optimized Production at the lowest cost.
2) Employees Focused on process control, problem resolution and sustainability.
3) Current Infrastructure Maximized BEFORE expansion capital is approved.

BUT…how do we learn the potential of the current infrastructure?

	Budgets and actuals always include process failure costs. If we never seek out a different performance reference point that is free of failure, we tend to accept the numbers we do see as representative of potential performance, when if fact, the true potential already paid for may be significantly higher.
	Year after year, budgets are approved with some improvement included. Improvement is defined as “better than last year”, but total improvement potential remains unknown if the upper limit for improvement with the current asset base is not known.
	“Optimum” performance reveals new opportunity for all employees and redefines the point where expansion capital is needed. It also provides a view of process bottlenecks after improvements have been made – enlightening employees as to local plant bottlenecks and the true global bottleneck for a value stream.
	You judge a business’s ability to perform based on the dollars on the general ledger. These dollars are the net result of everything that happened during a month – process failures, lost productivity and lost sales, and excess costs. The dollars missing represent the value that has not been extracted out of the business.
	You must know the dollars associated with untapped potential in order to know when to spend expansion capital and to understand how many dollars are out there waiting to be captured and brought to the bottom line.
	Once quantified in units of production, valuing this potential is the next step. These dollars impact employees’ views of what problems cost and why they are important to fix more than any other type of performance data available.