SHOW & CHAPTER 18: OPERATING COSTS - WILLIAM EASTMAN

This is the third show of six looking at how a business can find ways in an inflationary market contain costs and stay competitive.  During the early stages of inflation companies can pass on additional costs until the customer cannot afford it, its called Demand Destruction.

Show Objective
Given the shows on achieving lowest cost producer, cost of purchased inputs, and capital costs; you build a working model of the entire cost structure of the company to ensure the higest value at the lowest cost.

EPISODE 85: Summary
Our approach is pay attention to the entire cost structure of the organization that will allow business to hold the line on prices during inflation and hold onto margins. If there was an ever a time to become the Lowest Cost Producer it's now.

Topics:

• Identifying shifts in key costs
• Analyze value chain
• Factor in cost economies

EPISODE 86: Identifying Shifts in Key Costs
Since we live in a networked world - whether that is local, regional, national, or global, an economic downturn will affect you and your supply chain differently. Things that made sense months ago will require reexamination. You can no assumptions that the past is a predictor for the future.

Topics:

• Inflation's accumulated costs
• Creates a major shift in the cost structure
• Emphasis on moving to alternatives
• Impact is unique to each industry, to each business

EPISODE 87: Analyzing the Value Chain
The best place to start is to review your entire value chain; you inputs,your value added processes, and outputs to customers or the next step in the supply chain.

Topics:

• Analyze the entire chain
  • Inputs
    • Suppliers
  • Processes
    • Materials
    • Equipment & Parts
  • Outputs
    • Distribution
    • Installation
• Impact on Company's Value Added
  • Value Mapping
  • Activity Based Costing
  • Benchmarking

EPISODE 88: Factoring in Cost Economies
You have done the anlaysis, now is the time to turn the information into actions. How can you take the current situation and turn it to your advantage?

Topics:

• Differentiate
  • Improve product / service performance
• Reduction of SKU's
  • Narrow offer
• Scheduling
• Job Efficiency
• Operational Efficiency
• Waste

Next Show/Chapter 22: Margins

How to apply today's show to your business:

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