Does “best practice” reduce costs?

The answer should be yes, best practice (company procedures) should be designed to ensure that every activity is carried out as efficiently as possible within the agreed levels of service and safety.  For certain activities best practice may be defined by legislation, industry practices and even directives from equipment suppliers.

However, over the last decade organisations were sold the idea that best practice could be the same for all.  The drive for industry best practice combined with benchmarking (particularly in overhead activities) became a justification for additional expenditure on systems, functions, jobs and salaries as managers tried to match other organisations.

Some of this was unnecessary and added substantial costs in overhead areas which should now be critically reviewed and optimised.  The key questions to be answered are:  what is the total cost of the process and each of its activities?;  what are the service level options of each process activity from minimum to maximum?; and how do we optimise and prioritise all these service levels across the organisation to meet financial constraints?.

The result of this approach will be a reduction in overhead costs and best practice set in the context of efficiency and financial constraints.  Take a look at OPTIMISER cost optimisation in a box.  It is a methodology and system that will let you know exactly where to target your efforts continually.  For more information click here.

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