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Overhead and waste, how to cut costs in these areas
Well in order to do this, you need to eliminate the waste that happens in your business. There are so many areas that companies lose money simply due to waste. Waste that happens from insufficient training, the wrong tools, or lack of motivation, is something that can change. These changes can take place by recognizing the waste and changing it.
The reason these methodologies were designed was because these large companies found that they were loosing money. Much to much money to measure against the sales and profit they were makings. So in order to cut back on overhead and waste there were some steps that they took to make the changes happen for them. All of the steps through each of the methodologies are pretty similar. The each of the base questions in their design that are listed here. 1. Where is the waste coming from? 2. When you are past the point of recognition, there needs to be a tracking and plan set up to make the necessary changes happen. That means that there needs to be goals, steps, and expectations in writing. What are the steps and expectations? When you get this information, it will be easier to change the overhead and waste, and cut the unnecessary costs that are occurring. After you get this information, it will be important to follow through with the consistency it will take to get the goals fulfilled. This means that each person that is involved with these changes will need to be trained in the new processes. Then the processes will need to be continued in a consistent manner. This will be hard for some of the employees that have been doing the other processes differently. However basing the changes with positive feedback and rewards will increase the overall changes success. This is how a company can cut costs in overhead and waste. This is in addition to being able to start their company onto a higher level of success in production. When the waste is removed and the overhead is lower, there is more profit to be spread into functioning areas that deserve the money.
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