Reduce the Units of Input Not Producing Output

Reduce units of Input (I) available but not producing Intermediate Cost Drivers
(ICDs). This action makes Input levels more directly variable with the quantity of the ICD by reducing the amount of the available Input that is wasted or idle. For example, an employee (I) might produce one subassembly (ICD) per day. During that day, the employee spends a total of one hour waiting for parts for the subassembly. If the Company could eliminate that one lost hour of the employee's work day by providing parts in a more timely manner, the Company could reduce the number of employees (I) needed to produce the same subassembly (ICD) by 1/8th.

A. Assist Input in increasing ICDs.

Recognize efficiency. When people understand that the company is measuring efficiency, they pay more attention to what is measured.

Pay according to varying levels of efficiency: Pay for personal performance:
On employee revenue contribution

No.	Industry SIC	Year	Notes
1	3011	2002	Goodyear decided that it was a bad idea to reward its sales force on volume alone. It revamped its bonus system to encourage them to earn bonuses that are weighted on revenue per tire as well as peer volume.
2	5311	1989	Bloomingdale's switched from hourly wage scale to 10% sales commission. Overall sales have increased 22%.Employees claim you have to work much harder to earn the same amount of money.
3	5311	1986	Survival-minded retailers learning the value of rewarding salesclerks with commissions. Sales at the Broadway stores have risen "significantly" since it started paying commissions. The chain pays 85% of its staff on commission, up from 20% last year.
4	5812	2006	Restaurants are working to improve the performance of their staffs through positive measures. Many restaurants run nightly sales contests where servers sell a specific item, a glass of wine or a special entrée. Others tally sales at the end of the month and give the server with the highest beverage total a free dinner or a bottle of wine. However, some experts warn that excessive competition can sour relations between servers.

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