On average, each $1 in cost reduction can equal $5 in new revenue. So, in an economic environment where sales are flat and clients are resisting price increases, cost reduction is a primary way to improve the bottom line and increase the value for shareholders.
Traditionally, cost reduction has been viewed as a one-time annual exercise. However, in order to drive meaningful improvements in a company’s financial efficiency, cost reduction should be an on-going process that challenges suppliers to constantly lower the cost of doing business.
The major barrier to continuous cost reduction is not the suppliers; instead, the internal resistance to change by employees is often the primary reason millions of dollars can be left onthe table.
The following whitepaper outlines the six primary reasons employees resist cost reduction efforts and illustrates possible solutions to overcoming this resistance.
Download white paper here: http://operatingcosts.com/internal-resistance-to-cost-reduction/