CRP Eval. Score

Business Solutions - The Positive Way, Cost Reduction and Profit Improvement

 

 

 

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Cost reduction and profit improvement for businesses

 

17. SCORING: Evaluate Your Existing Cost Reduction Program (CRP) 

Give yourself one point for each "yes."
bulletIf you score 6 points or more, you have a good Cost Reduction Program structure that should be working well for you.
bulletIf you score 5 points or fewer, your CRP is a strong candidate for review.

Experience shows that the most productive and vital CRP's contain all of the first nine elements and continuously produce savings in excess of informal plans. The reasons that formal plans are superior to no plans or informal plans are as follows:

bulletFormal plans keep corporate expectations in focus.
bulletRegular reporting makes it easy to track and quickly adjust projects when needed.
bulletOrganizational and individual accountability helps people find the time, energy, and other resources to invest in creating savings.
bulletOngoing expectations keep the program alive. They motivate people to think "outside the box," to find new ideas when the old ones are used up. Research shows that most new ideas come from the last 10% of ideas.

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18. SCORING: Is Your Organization a Candidate for a CRP?

Give yourself one point for each "yes."
bulletIf you score 3 or more points, you are a likely candidate for a CRP.
bulletThe higher the point count, the greater the imperative and anticipated benefit.

Cost Reduction Programs improve profits and financial stability. Every dollar removed from the cost structure reports directly to the bottom line as profit. Target elements of your expenses and reduce those that can be managed by such tactics as:

bulletTraining and information - cost awareness
bulletQuality improvements
bulletSmarter buying - lower purchase price, different materials, better value, etc.
bulletReduced waste
bulletImproved productivity
bulletInventory reduction
bulletPlanned workloads
bulletDe-bottlenecking operations
bulletReengineering operations
bulletForecasting & strategic planning
bulletWork flow analysis and improvement
bulletLoad leveling
bulletProblem solving & problem prevention

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 Get your costs and bottom line profits under control now

Achieving World-Class Profit Improvement - proven methods for cost reduction and profit improvementInstant Profits: Making Your Business Pay - 250 tools, methods and tips for cost reduction and increased profits57 ideas for cost reductionProfit Improvement Executive Analysis - what you really need to know about cost and profit improvement programs including 6-sigma

The very survival of our companies and organizations depends on how well we do as managers. We are expected to produce quality products and services under ever-growing competition and price pressure.

The quickest and surest way to improve profitability is to effectively reduce costs. Each dollar removed from expenses, reports to the bottom line profit. The most difficult approach is to increase sales. While the best corporate strategic and operating plans focus on both, one cannot deny the power of an effective Cost Reduction Program.

c) 1998, 1999 2006 Steven C. Martin, Business Solutions.  All rights reserved.

The contents of this paper are copyrighted and, as such, may be used for personal use only.  Duplication and/or commercial use of this material is expressly prohibited without written permission of the author.

Cost Reduction & Profit Improvement
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