Ramp Up

Categories: Company Management

So why is it "ramp" and not "step" or just "up"? Like...you can up production. You can step up production. But here we're...ramping it. Why?

Well, think about the shape of a ramp. It gradually slopes upward, and that gradual thing is key. Lots of companies that make stuff can't just suddenly switch a flip and blink eyes twice like Jeannie and do double production next month. If you make Ford Trucks, you simply can't go from 10,000 units this month to 20,000 next. There just isn't the infrastructure to scale up to do that. And even if you do, what are the odds that, in the next few years, the economy softens and demand dampens and then you'd have doubled production capacity at big cost for...nothing.

So most of the time when companies need serious capital and infrastructure and have complex products, they can only ramp. Like...could Ford add 500 trucks above the 10,000 next month? Sure. And the next and the next and the next? Sure. But then they'll have taken almost 2 years to double capacity if, say, the new release of Hulu-in-a-truck suddenly drives massive demand for Ford trucks. But they'll have ramped. And, well, that totally fits with the product they make.

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