Don't Overlook the Soft Dollar Savings

You’re probably using this time to weigh the costs and benefits of your company’s operations, but are you analyzing all of the fixed costs?

Analytical and precise by nature, CFOs are famously averse to anything that can be deemed "squishy." Subjectivity, vagueness, wiggle room, these are qualities that CFOs routinely attempt to expunge from budgets, briefings, and business plans. They seek clarity as relentlessly as Sidewinder missiles seek heat, and that's generally to their credit.

That may be one reason why many tend to regard "human capital" as a euphemism for "personnel" or "labor" rather than a legitimate strategic issue. It's not that CFOs don't regard the collective capabilities of their workforces as critically important — they simply aren't sure what they're supposed to do about it. As a result, many leave the "soft" side of human capital to the human-resources department and fixate on the salary, benefits, and other costs associated with all those bodies. (CFO Magazine, 2/1/09)

Lean Manufacturing was forged in similar economic times. It’s been our experience that transportation departments aren’t as lean as they could be. External partnerships and technology can often minimize redundancies while improving customer service and cutting costs. Are you analyzing those operations as thoroughly as you should be?

Proactive companies are going to come out of this recession in a better position than their competitors. Will your company have that competitive advantage?