cost reduction and cost avoidance

1838 WordsDec 25, 20138 Pages
Cost reduction Generally defined as the act of cutting costs to improve profitability. Cost reduction, should therefore, not be confused with cost saving and cost control. Cost saving could be a temporary affair and may be at the cost of quality. Cost reduction implies the retention of essential characteristics and quality of the product and thus it must be confined to permanent and genuine savings in the costs of manufacture, administration, distribution and selling, brought about by elimination of wasteful and inessential elements form the design of the product and from the techniques and practices carried out in connection therewith. In other words, the essential characteristics and techniques and quality of the products…show more content…
Contingent workforce management Organizations are relying more heavily on contingent workers to meet critical staffing needs. As this need continues to grow, the coordination of staffing suppliers and the ability to strategically administer the process and control spend becomes paramount. Establishing clear, enterprise-wide management programs can ensure consistency, flexibility and responsiveness that drive results. Successfully implementing a Contingent Workforce Management program requires a technology solution with a foundation based on standardized efficient and effective processes. However, true strategic optimization is difficult to achieve without a clear win-win strategy and partnership within your supply chain. Key to realizing a true partnership model is derived from a clear understanding of the primary value proposition organizations may recognize within a structured program and how an organization can leverage those vendor benefits in their quest to achieve true supply chain and flexible workforce optimization. Design for supply Focuses on the design and selection of common components for product families or platforms. This concept is to minimize component variations used to produce each brand or family of products. While it is important for marketing to differentiate each offering so that it can adequately satisfy the needs of unique consumer segments, differentiations that are
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