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.

E. Reduce other underemployed input.

These changes put idle, or wasted, Purchases and Capital to work. These examples complement the ideas above, which deal primarily with improving the efficiency of People.

Employee benefits

No. Industry SIC Year Notes
1 3011 2007 In an effort to reduce the costs of health care, many employers are requiring their employees to prove that they have eligible dependents. This process could save corporations millions and help keep premiums down for legitimate beneficiaries but may have a negative impact on employee morale. Audits have found that up to 15% of those claimed as dependents aren't actually entitled to coverage. Goodyear Tire & Rubber found that 13% of dependents were ineligible and it reduced its health costs by 6% in 2005.

<<Return to Reduce Input Not Producing Output