LYSIPPE - Formation Lean Management, Réduction des frais généraux

Cost reduction

Thursday 15 February 2007 by emmanuel

Everybody knows that :

- customers decide most on the price of products.
- It is the market which makes the price. The economic equation of your company is simple:

- Profits = Volume X (Price - costs)

You decide neither on volumes, nor on prices. Your only leverage to grow your profits is to control your costs. The costs given up with themselves give this:

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Les coûts non maîtrisés

Do you know the past evolution of your production costs of your principal product over the last three years?

- 10 out of 10 among you know the trend of price.
- 9 out of 10 do not know the value and the trend of cost.

However this should be one of your four principal indicators.

Driving costs is not a "one shot" action, like a renegotiation of the subcontracting, purchase prices in a low cost country,…

Driving costs is built with method.

Driving costs passes by the deployment and the systematic use of tools. All the departments of your company must contribute to the reduction of the costs. (Just as lead time reduction needs the involvment of all departments)

Lysippe proposes you a global method for costs reduction :

- To attack all the elements composing the cost of a product (An article in french entitled : Réduction des coûts).

- Lysippe trains you with the tools for costs reduction and transmits his “know-how to you”.

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