P LETTER OF THE WEEK
Page 17
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Think outside of the box to make cost savings during the recession
IT APPEARS THAT nearly all companies in the transport and logistics sector are suffering from the current recession.
Sales are down, profits on those reduced sales are also down, and, therefore, profits are suffering from a double blow.
We are sure that every wise company is reviewing costs to see how they can be reduced without the business as a whole, or the reputation of the company, suffering.
We closely monitor the efficiency of a business to see where savings can be made and our experience has shown it to be most effective in service or manufacturing operations Our process uses a team of the company's own employees who, under the guidance of the team leader, closely analyse the operations performed by each employee in a spe cific department or area and assesses where time or material savings can be made.
We have found it is essential for the team leader to be from outside the business (or maybe from another branch, but even that is unlikely to give the best results) as those from within the company have become 'accustomed' to the present way of doing things and usually see far fewer opportunities for improvement than an outsider.
An 'outside pair of eyes' (expertly trained to visualise potential alternatives) is definitely the key to a successful outcome.
In one large operation with two vehicle workshops, it was proved that profits (including profits on the additional parts sold through the two service departments as a result of the increased throughput from the same number of technicians) due to increased efficiencies would increase by a little over £3.5m over the first 12-month period following completion of the exercise!
Every minute saved by improving the efficiency of a technician, or ensuring they do the job they are employed and trained to do, rather than performing tasks that do not use their skills to the full, (therefore, tasks that should be performed by others or should not be necessary if policies or procedures are modified, or maybe aren't really necessary) is a bonus. The aggregate time saved will often enable one more vehicle per day to be serviced by that technician — a significant saving! Ian Godfrey
Director CIP Development Services