Increase the Output Over Which a Fixed ICD is Used
This action reduces the quantity of a unique fixed cost ICD used to produce a unit of Output by increasing the units of Output. For example, a new product design, or a new process patent, are both ICDs that have virtually limitless capacity for use. These are fixed cost ICDs. You pay for them once and you can use them over a virtually unlimited amount of Output. Their ICD/O ratios are limited only by the current demand level for Output.
Use fixed cost ICDs with more customers
By using fixed cost ICDs with more customer volume, the unit cost of the ICD declines as a component of the final Output cost.
Use fixed cost ICDs with competitors who employ outsourcing. Sell ICDs in major cost functions of the company:
Sell Service ICDs
|1||4512||2007||While many airlines cut back on maintenance operations in order to cut costs, Delta signed a contract with Chromalloy Gas Turbine which will it allow it to service two major engine types in-house. They will then be able to service the aircraft of its rivals although some cite concerns over which craft have priority. Delta's Technical Operations has contributed significantly to the airline's revenue and now has more than a hundred outside clients, including foreign carriers, cargo operators, regional airlines and domestic carriers.|
|2||5599||1993||Auto malls use innovative cost management: different dealers share vehicles for parts runs, share a landscaping service, share promotions–all to cut overhead.|
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