Want to lower costs? Don’t slash headcount. Reduce the driver. If purchase orders drive your accounting costs, stop creating a PO for every pack of sticky notes. Automate or batch the process.
If you don’t know what your cost drivers are, you aren’t managing your business. You’re just reacting to it. cost driver
| Industry | Cost | Cost Driver | | :--- | :--- | :--- | | Restaurant | Electricity bill | Number of covers (guests served) | | E-commerce | Shipping fees | Number of boxes shipped OR weight | | Hospital | Nursing staff | Patient days (total nights in beds) | | Law firm | Paralegal time | Number of documents reviewed | | Manufacturing | Machine maintenance | Machine hours run | Want to lower costs