Methodology
Financial Indicators
Indicators Cost Management Specialists use include:
| COST FACTOR | MEASUREMENT |
| | FINANCIAL |
| Sales | Customer Profitability, Gross and Net Profit, EBIT, Trends, Forecasting, Variance |
| Profitability | Margin, Trends, Profitable: Unprofitable client ratio |
| Working Capital & Liquidity | Cashflow Cycle, Cashflow Trends, Interest Coverage, Asset Turnover, Inventory Turnover, Receivables Turnover, Debtor Day Trends. |
| | INTERNAL PROCESSES |
| Quality | Defects, Returns, Rework, Continuous Improvement, Variance |
| Productivity | Capacity, Utilisation, Cycle time, Work in progress, Labour efficiency, Yield ratios, Machine efficiency, Waste, Absenteeism |
| Process Review | Efficiency, Effectiveness, Integration, Quality, Meeting time, Duplication, Non value adding, Action bias. |
| Supply Market - Best Value | Strategic Alliances, Tendering Criteria - Quality, Service, Price, Information, Expertise Integration & Fit. |
| Waste | Over Production, Waiting, Transportation, Inappropriate Processing, Unnecessary Inventory, Defects, Variance |
| Equipment Readiness | Setup time, Cycle time, Scheduling, Downtime, Operator experience, Machine capacity, Preventative maintenance, Variance Analysis |
| | LEARNING AND INNOVATION |
| Staff Driven Improvement | Specific and measurable results from Deliberate creative thinking, a cost management mindset, change readiness and innovative solutions to better return on investment. |
| Systems Bias | System enhancement based on experience, opportunity and continuous improvement. |
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while all the rest went on with their old measurements and expected them to fit me."