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92% of companies do not know the hidden costs


92% of companies do not know the hidden costs

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  • Time of issue:2015-04-17 22:35
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(Summary description)The income of an enterprise comes from a reasonable and appropriate cost input. Generally speaking, the higher the cost input, the higher the income will increase year-on-year. However, in the development of an enterprise

92% of companies do not know the hidden costs

(Summary description)The income of an enterprise comes from a reasonable and appropriate cost input. Generally speaking, the higher the cost input, the higher the income will increase year-on-year. However, in the development of an enterprise

  • Categories:Company News
  • Author:
  • Origin:
  • Time of issue:2015-04-17 22:35
  • Views:3

The income of an enterprise comes from a reasonable and appropriate cost input. Generally speaking, the higher the cost input, the higher the income will increase year-on-year. However, in the development of an enterprise, there is a kind of "hidden cost" that constantly restricts the enterprise to go further. "Hidden costs" can not only bring relative benefits, but also seriously affect the healthy operation of the enterprise. So, what are these terrible "hidden costs"? What are the hidden costs?

Enterprises always encounter bottlenecks in the development process, and feel that the operating costs are high, but it is difficult to find the cost. We call it "hidden costs". This is like a hidden disease in the living body. It will not heal for a long time, and it will leave the operator a headache.

If these "stealth costs" can be found, it is undoubtedly like finding "pathogens", then the next step in "correcting the right medicine" must be when it takes off again. If you can summarize the many "hidden costs" that companies often have, companies can conduct self-checks by comparison. In particular, the editor summarized the twelve "hidden costs" as follows:

I. Conference costs

A meeting is a collective activity for companies to solve problems and issue instructions, but it is also a high-cost business activity. Because this event is often a collective activity involving many leaders, every minute passes means the number of minutes of the total number of participants, and the management of many companies did not master the meeting skills, there are "unprepared before the meeting, during the meeting There is no theme, no implementation after the meeting, no need to attend the meeting, no time control, and no boundaries in speech. "

Purchase cost

Once there was a company, when doing a new project, the daily operating cost of the project team was 80,000 yuan, but on the eve of the product listing, the procurement department spent a week in order to purchase more than 100,000 yuan of packaging. The reason was that Find cheap suppliers to save procurement costs. As a result, the entire marketing team was unable to sign up with customers for an additional week.

This phenomenon actually exists in many enterprises. The blind pursuit of reducing the direct cost of procurement while ignoring the coexisting "hidden cost". Of course, reducing the direct cost of procurement is not in conflict with this article. Here, we want to say that the purchasing department of an enterprise must comprehensively weigh various indicators from the perspective of overall operation in order to truly control the cost of procurement.

Communication costs

In most enterprises, you will find that in the process of communication between colleagues, there will be serious distortions, or the words are unsatisfactory, or the answers are not good, or there are hundreds of people ... This phenomenon, which is small, makes many processes Become an invalid process or lose many important opportunities. If it is too big, it may cause hidden dangers to the enterprise.

Fourth, the cost of overtime

Many bosses always think that the “overtime” of employees who “sleep and forget” after work is a phenomenon of professionalism. As everyone knows, this may imply high costs. There are three reasons:

First, the reason for overtime is not necessarily because the work is too heavy, but it is caused by the inefficiency of employees. Overtime means inefficiency.

Secondly, overtime consumes more staff energy and physical strength, and seriously over-expends the health of employees. In the long term, some important employees will not be able to exert their effectiveness for a long time, and there will be hidden dangers to the company. Long hours of overtime lead to fatigue and accidents, and companies pay a heavy price for this.

Third, overtime employees are not necessarily "business-oriented." Some employees are called overtime after work. They use the company's resources to engage in their personal affairs. They also receive overtime pay from the company. Many companies have important losses and data loss. All of them happened during off-hours, and overtime became a dead end for enterprises.

V. Cost of Talent Flow

Many companies are lacking in human resource management. They believe that talent is unlimited and become "iron camps", so employees will naturally become "flowing soldiers". It must be said that the departure of an employee is a cost to the company, because the company must bear the initial investment in training costs for this employee, as well as the up-front costs of recruiting new employees, and whether the new employee is suitable for the job Due to professional literacy, veteran employees may lose important internal information or information, and after leaving, they are likely to enter their competitors' companies.

Therefore, the loss of employees, especially veteran employees, will undoubtedly cause the company to spend several times higher than its income. Many small businesses have been operating for many years, and you find that they have always been such a small team, and no one except the boss has left the company since its establishment.

Costs of job dislocation

There is a famous saying in human resource management: "Put the right people in the right place." Unfortunately, not many companies can really do this.

I once recruited in a talent market and heard conversations between employees, saying that every job fair requires their staff to move tables and chairs, because it is a rented gym as a recruitment venue. Up to professional managers, down to ordinary employees, have become "porters", I can't help but sigh, this company is engaged in talent recruitment and management, how could it cost so high to hire unprofessional porters.

In fact, this reflects a very clear mentality of the bosses. They think that these employees are recruited to use it, as long as they can do it, they do not need to spend more money to do it. But we found that they paid a high price. The company's employees have been complaining because quite a few of them are female employees who have no strength to move the tables and chairs. Those senior officials have never experienced such "prestige" and some have left. We haven't recruited at the job fair since then, because I don't believe such a team can provide me with a good service.

Process cost

There are too many chaos in an enterprise because of processes. This is a common problem in enterprise management. For a company that develops slowly, its processes must be chaotic or unreasonable. They bear a high cost for this, but they have always turned a blind eye. Processes are the industrial chain operated by enterprises. Like assembly lines, without scientific and reasonable processes, they will lose systematic control over various tasks. Many jobs will be abandoned halfway through, and many jobs will need to be reworked. This will become a mess that envelops the company's forward feet.

Costs of stagnant resources

The stagnant resources can be said to be the most extensive "hidden costs" in the enterprise, such as idle equipment, backlog of inventory, low-utility job occupations, idle funds, suspended businesses, etc., although they may not continue to consume the enterprise Investment, but they are part of the company's assets, and the company will bear hidden costs such as interest. Therefore, the amount of stagnant resources in an enterprise reflects the level of enterprise resource utilization.

Nine, the cost of corporate culture

Some people say that corporate culture is like the soul of an enterprise, and it will be reflected in the mental outlook of each of its members. This kind of culture has been established in the early stages of the establishment of the company. He is influenced by the culture, habits, skills, occupation, likes and dislikes of the founder of the company, so some people say that the corporate culture is the boss culture.

But saying that corporate culture will become a cost, maybe many people disagree, but it is true. We will find that the employees of some companies are debilitated and the work efficiency is extremely low. No matter how good the employees are, they will either leave soon or they will become the same. We cannot help but say that this is an "environment" problem. And this "environment" is exactly the corporate culture of this company.

Corporate culture is like the life of an enterprise, and it will accompany the life of an enterprise. It can only be adjusted and cannot be rebuilt.

Ten, credit costs

This is a cost that involves long-term returns, and integrity management is like being a person with integrity. We have found that many companies are accustomed to defaulting on payments to suppliers, are accustomed to default on employees' salaries, are accustomed to deduct others, and are accustomed to default on bank loans.

However, in the long run, this will become a serious hidden cost for the operation of the enterprise. First of all, the supplier must count the time cost in its quotation. Such enterprises cannot purchase the lowest-priced raw materials or services. Secondly, employees who are in arrears with wages and violate labor regulations are at risk of being punished. And defaulting on bank loans and deducting others will greatly reduce their creditworthiness. When a company encounters difficulties one day, they will be embarrassed. There is no doubt that companies have to pay a heavy price for this, but in fact they have not benefited from it.

Eleven, cost of risk

Bringing the company to the fast track is the dream of every entrepreneur. However, the risk factor has also increased. Especially large and medium-sized enterprises, although they are developing rapidly and have rich incomes, once a crisis occurs, it will be disastrous. Many cases have proved that many of the risks of enterprises are caused by inadequate expectations or poor management. Before the risks occur, hidden risks have been planted early. And many large companies or well-known companies die because of a single risk.

It can be seen that risk is a significant hidden cost. And this phenomenon is not obvious, it is really "it's nothing, it's amazing."

Twelve, entrepreneur costs

"Entrepreneur cost" refers to the cost that the owner of the business brings to the business. There is a good sentence, there is one soldier, and one nest. Entrepreneurs are like the leaders of an army. They are the employees who pay the highest costs for the enterprise. The bosses of many private enterprises have turned themselves into "emperors" of the enterprise, and everything is done by themselves. However, the shortcomings of entrepreneurial personal factors will add a heavy cost burden to the enterprise.

This phenomenon is mainly reflected in small enterprises, but also exists in large enterprises. We can also extend this cost to every department or even every employee of the enterprise. Because everyone is responsible for their own work, we often emphasize that in your area, you are the leader and you have the right to make decisions. And many leaders have been centered on themselves, which will greatly reduce the team's combat capabilities and increase high hidden costs. I remember saying a word to a boss who complained about the company ’s lack of talent: “What your company lacks is not talent, but wisdom to discover and make good use of talent”.

It can be seen from the above that enterprises often bear a lot of burdens in business management, and hidden costs are one of the heaviest burdens. Finding and effectively reducing the above hidden costs is a powerful measure for corporate progress.

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