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Reducing the Costs of Operations and
Processing
ProAnd employ
several tools as part of a methodology to reduce the costs of operating
a meat processing business.
The costs of
processing also need to be considered by classifying the area in which
costs are incurred i.e.
 |
Internal
costs - costs which are under the control of the business |
|
External
costs - costs that are imposed on the business either as part of the
supply chain or markets targeted for products or regulatory compliance
costs. |
Each processing
company is different - operations, markets, products, location etc.
ProAnd has
the experience and tools to assist you in all stages of the cost reduction
process. Stage One - Establish the Present Position
| Actions |
Tools and processes
(options) |
Outcomes |
| Establish present performance
of the processing operations
Establish performance variance from industry averages
and best in class industry indicators |
Financial
performance benchmarking |
Quantified base
performance point to audit and measure outcomes of project
Realistic, achievable targets for the cost reduction
project. |
| Labour audit |
| Technology audit |
| External cost review |
| Supply chain review |
Stage Two - Determine the project(s) -
Structure the Program
| Actions |
Tools and processes |
Outcomes |
| Review outcomes of review process
and determine projects that will provide improvements in cost of
operation.
Determine the KPI's, costs and deliverables for the
projects
Prioritise projects to provide a coherent strategy for cost
reduction
Determine resource requirements and program
|
Cost benefit analysis |
Coherent strategy for reducing
the costs of operating the business.
Defined outcomes and agreed deliverables before
committing expenditure
|
| Plant operational cost |
| Return on Investment (ROI) |
| Internal rate of return (IRR) |
| Payback period |
Stage Three - Project(s)/Program Implementation
| Actions |
Tools and processes |
Outcomes |
| Provide information to affected
staff and teams.
Allocate resources and appoint responsible persons
Provide necessary authorities
Implement and monitor projects
|
Staff / team meetings |
On time / on budget project.
Informed workforce
Input from affected staff/departments
|
| Bulletin boards |
| Project review
meetings |
Stage Four - Completion of Cost Reduction
Program
| Actions |
Tools and processes |
Outcomes |
| Commissioning of Projects
Post projects / program review
|
Labour Audit |
Corrective actions
Lessons learnt
Reduced cost of operation |
| Benchmarking |
| Measurement against project/program KPI's |
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