Managers are not cops, overlords, cheerleaders or shepherds. They are people who through luck, political savvy, tenure, circumstance, talent, or training have achieved a level in an organization that gives them powers
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COVID-19 will change how many businesses engage with customers and their workforce. Re-envisioning both selling, and delivery models will be critical for many.
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As technology has advanced and organizations have become more and more reliant on smoothly running equipment, viewing maintenance as a critical function to support throughput, rather than as a cost center to
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If you look at some of the activities performed by finance personnel with a critical external eye, you can often find people doing things for reasons that may no longer be valid.
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Finding the opportunity with variable overhead costs requires trying to understand how these costs are allocated in the financial statements and then analytically drawing some correlations between those costs and the process hours.
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When companies volumes decline they are often stuck with more fixed costs than they need. Fixed costs are often much more difficult to reduce than variable costs because they represent a longer term commitment in many cases.
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Indirect labor includes supervisors, material handlers, quality technicians, mechanics, and IT support, all functions which are required to support the production of goods or services. While the functions are important to keep organizations working, its not always easy to determine how many people you actually need.
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Hours worked are driven by how many people you need to run a process to achieve some volume output. So there are two distinct analytical questions; how do you staff the process, and how well does the process run?
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It takes quite a lot of humility to find opportunity and sometimes being smart simply makes it that much harder.
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Whenever we see overtime over 5% an analytical red flag goes up and we start to suspect that there may be too much cost built into the process. Many organizations use overtime to offset peak volume periods.
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