Understanding the different cost elements which make up your product or service. Applying the most effective way to provide your product or service and building metrics /KPI’s to enable you to monitor and improve your cost performance.
At Workplace Partners we turn the typical cost equation for a product or service around. This is because the Selling Price is determined by the customer. If the Selling Price doesn’t meet your customer’s expectation then you are not going to get a sale. Likewise the Profit is set by the company, that’s why you are in business. So the only component which can be manipulated to ensure the equation balances is the Cost of Product or Service
Cost of Product or Service = Selling Price – Profit
This approach forces your business to think differently about costs and really try and understand what is value, something a customer is prepared to pay for. Everything else is waste and our Advisors are experts at identifying this waste and have the necessary toolkit to enable it to be removed.
Once an understanding of the cost of product or service has been obtained it is important that systems are built and monitored to ensure the performance can be maintained.
Based on our experience cost reductions of around 4% p.a. is commonly achieved. That’s possible year on year on year. Imagine what negating the cost of inflation every year would do to your business and sales. This is achieved by applying an improvement programme our skilled Advisors would help you establish, based on the principles of Lean Thinking. It incorporates activities such as but not limited to: Improvement Teams, Visual Control and Management, 5S and Workplace Organisation and processes to ensure work flows through the organisation.
Our Advisors focus is on eliminating waste and ensuring your process flows as efficiently and effectively as possible by looking at all the various parts of the business: sales, office processing, operations, logistics etc. We know there is significant opportunity for cost reduction in areas outside of operations and logistics. It’s surprising just how many times we find your sales and office processes actually drive costs into the organisation. The entire business must be willing to eliminate waste if you truly want to have a cost effective and efficient organisation.
Our Advisors engage your team to help them solve problems they encounter every day. They do this because we know by changing the team behaviours → changes their attitude → which then drives the culture and sooner or later it just becomes “the way we work around here”.
Contact us to find out more about how Workplace Partners can provide your business with Cost Efficiency and Improvement assistance.
Phone: 1300 116 400
Email: [email protected]