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.
Eliminate unexpected downtime. The company may know that it will have occasions of unplanned downtime and may take steps to reduce or eliminate this loss in efficiency.
|1||1041||1993||When Barrick discovered large gold reserves, it had to recruit 1300 miners. To house them, Barrick brought in a developer to build hundreds of homes. Barrick even waived the downpayment on the homes for some employees.|
|2||2086||2005||To further offset the higher costs of health care besides higher co-payments and deductibles, companies are testing new ways to find more savings. PepsiCo, American Standard Cos., and others have launched ambitious programs to identify workers at risk for major health problems – and prod them to clean up their acts. At PepsiCo, employees can fill out a health appraisal that looks at everything from their cholesterol levels to their family medical histories. An outside consultant reviews that information and evaluates their chances of developing heart disease, diabetes, and other ailments. Those at high risk can tap health-care coaches paid for by PepsiCo. Some 16% of the company's 50,000 employees now work with a coach.|
|3||3140||2006||Stride Rite was determined to continue its growth. The CEO realized the importance of happy, productive employees and set up on-site day care centers which made their lives easier, allowing them to focus on work. The firm was able to attract and retain the best and brightest employees, which minimized turnover, training costs and productivity.|
|4||4213||2004||Officials at Celadon put a big focus on keeping their people happy. "There's an endemic driver shortage in the over-the-road trucking business." Celadon provides long-haul, full truckload services between the US, Canada, and Mexico. Its annual driver turnover is 70%. The industry average is 115%. "They pay a lot of attention to their drivers. They provide excellent equipment. They do their best to get drivers home as rapidly as they can."|
|5||5411||2006||Despite Wal-Mart's RediClinic idea, it is also getting slammed just like every other company by the rising cost of health care. Critics are trying to force Wal-Mart to adopt the more generous benefit standards of the typical blue-chip corporate giant. Wal-Mart is responding in three ways: (1) by vigorously defending itself in the opinion wars, (2) by launching initiatives, large and small, such as opening the new clinics, giving employees big discounts on fruits and vegetables to promote healthy eating, and offering inexpensive “value plan” health insurance to workers that combines high-deductible catastrophic coverage with low co-pays on a limited number of visits, and (3) by insisting that ultimately health care is not a Wal-Mart problem but a national one.|
|6||6200||2007||As insurance costs rise, some companies are penalizing workers for their unhealthy habits. Principal Financial Group offers enhanced coverage with lower deductibles and co-pays to workers with high scores on a health evaluation. Those with lower scores will be encouraged to work with a plan-provided health coach to improve their scores. If they refuse, they will pay higher co-pays and deductibles. This links incentives with results, rather than just participation. However, the process may alienated workers and may be the basis for lawsuits.|
|7||7372||2008||Outstart, an online technologies provider, allows ExactTarget's sales force to post and answer questions about the software company's products and procedures. At first, ExactTarget downloaded a free wiki-like program off the internet and modified it for the company's use. Wiki is a technology that allows users to collaborate on a project and edit each other's work. However, it needed more maintenance than the free program or the company could give. That's how it found OutStart.|
|8||8742||2007||Deloitte & Co. has hired career coaches to find places for frustrated but competent employees within the organization. The career coaches are paid for by Deloitte and employees can use them free of charge. This reduces employee turnover and the resulting recruiting and training expenses. Deloitte has reduced turnover from 20% to 15%, the industry average.|
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