Most savings/expense is created in the design of the product/process. How many times have you told an engineer we are not designing a space shuttle?
How many times do you come under budget? Anyone can do anything if he has all the money in the world. Do you wonder why our government is in the position it is? Cost effective and simple are not dirty words. They should be the words we reward.
Improve by finding win/win solutions. It is a 2-way street. There aren’t many sellers markets left, take advantage of them. Also, consider your vendor’s perspective because that is the way you may get their attention and their trust. In other words, it is about the only route to being successful..
One of the great sources of waste is your own operations, Get efficient NOW. I cannot remember how many times I have seen companies in trouble that spend half their time returning and trying to use parts that were not correct. Get real, give your people the right parts at the right time with the right information. Guess what it WORKS!
In today’s, world it is amazing how much a supplier will do for you. Don’t look only at price concessions but look for engineering assistance, stocking programs, consignment, freight concessions and even PR .
Resist making major changes till the bleeding stops. The next person is always going to offer better solutions and service but that is seldom the case. Unless you find gross negligence, work with current suppliers for concessions and help.
Commit to an accurate schedule and be relentless about quality and speed in the administrative side.
Ditch the losers. If you are not making money on any product raise the price immediately.
Take a look at your special orders. Nothing elevates a supplier more than exceptional emergency service. You must do this to save customers. But they should pay extra, they may not even see see it as special until it is priced appropriately.
Getting leaner will pay off in huge dividends, the biggest one may be survival.