Reduce the Units of Input Not Producing Output

Reduce units of Input (I) available but not producing Intermediate Cost Drivers
(ICDs). This action makes Input levels more directly variable with the quantity of the ICD by reducing the amount of the available Input that is wasted or idle. For example, an employee (I) might produce one subassembly (ICD) per day. During that day, the employee spends a total of one hour waiting for parts for the subassembly. If the Company could eliminate that one lost hour of the employee's work day by providing parts in a more timely manner, the Company could reduce the number of employees (I) needed to produce the same subassembly (ICD) by 1/8th.

A. Assist Input in increasing ICDs.

Eliminate unexpected downtime. The company may know that it will have occasions of unplanned downtime and may take steps to reduce or eliminate this loss of efficiency.

Anticipate health problems

No.	Industry SIC	Year	Notes
1	2086	2005	To further offset the higher costs of health care besides higher co-payments and deductibles, companies are testing new ways to find more savings. PepsiCo, American Standard Cos., and others have launched ambitious programs to identify workers at risk for major health problems – and prod them to clean up their acts. At PepsiCo, employees can fill out a health appraisal that looks at everything from their cholesterol levels to their family medical histories. An outside consultant reviews that information and evaluates their chances of developing heart disease, diabetes, and other ailments. Those at high risk can tap health-care coaches paid for by PepsiCo. Some 16% of the company's 50,000 employees now work with a coach.
2	2879	2006	Dow Chemical is working to prevent health problems among employees the same way it prevents equipment problems. Dow employs dozens of nurse coaches, doctors, exercise instructors, and dietitians to help employees recover faster and return to work.
3	3577	2004	Pitney Bowes Inc. takes a different tack to slashing healthcare costs. Most other employers are handling healthcare cost increases by having employees shoulder more of the financial burden by raising premiums, deductibles, and co-pays. But Pitney Bowes's experience shows that spending more upfront to make it easier, and cheaper, for employees to manage some chronic illnesses make actually bring about greater savings in the long run.
4	3577	2004	Pitney Bowes Inc. takes a different tack to slashing healthcare costs. In 2001, Pitney decided to lower the amount that employees pay for diabetes and asthma drugs, thinking that if the drugs were more affordable, employees would take them more regularly and reduce expensive complications. Since 2001, the median medical cost for a Pitney Bowes employee with diabetes has fallen 12% from about $1000 a year. The median cost for a patient with asthma has dropped 15% from $900 annually.
5	3663	1995	Harris Corp. now offers free mammograms to employees and has dropped co-payments in half for such expensive procedures as MRIs.
6	3942	1995	Mattel recently added full vision care to a list of perks that includes a state-of-the-art health club at corporate headquarters.
7	4213	2007	As healthcare costs rise, some employers and insurers are hiring auditing services from companies like Healthways and Paradigm health to look for ways to improve costs and outcomes. Employees at J.B. Hunt can take advantage of the free second-opinion service of Best Doctors Inc.
8	4813	1988	AT&T is measuring benefits of Total Life Concept program to help employees have better health.
9	4953	1996	WF is seeking to identify chronic illnesses in workers which are 50% of medical costs. WF's program is a combination of voluntary risk assessments, health fairs, and special interest activities.
10	5411	2006	Despite Wal-Mart's RediClinic idea, it is also getting slammed just like every other company by the rising cost of health care. Critics are trying to force Wal-Mart to adopt the more generous benefit standards of the typical blue-chip corporate giant. Wal-Mart is responding in three ways: (1) by vigorously defending itself in the opinion wars, (2) by launching initiatives, large and small, such as opening the new clinics, giving employees big discounts on fruits and vegetables to promote healthy eating, and offering inexpensive “value plan” health insurance to workers that combines high-deductible catastrophic coverage with low co-pays on a limited number of visits, and (3) by insisting that ultimately health care is not a Wal-Mart problem but a national one.
11	6200	2007	As insurance costs rise, some companies are penalizing workers for their unhealthy habits. Principal Financial Group offers enhanced coverage with lower deductibles and co-pays to workers with high scores on a health evaluation. Those with lower scores will be encouraged to work with a plan-provided health coach to improve their scores. If they refuse, they will pay higher co-pays and deductibles. This links incentives with results, rather than just participation. However, the process may alienated workers and may be the basis for lawsuits.
12	6321	2003	WellPoint Health Networks use prizes and rewards to make their members take better care of themselves. In the Destiny Health Program, people are awarded points for taking a CPR class or losing 10 pounds. 23,000 patients are currently using the points, which gives them health memberships and much more.

<<Return to Reduce Input Not Producing Output