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Wednesday, February 13, 2013

Managing Cost Control

Cost control is an effective strategy for an organization to rein in its expenses and hence positively impact the profit margin. Here are some examples of cost controls that can be viewed as aggressive by employees if introduced for the first time but without exercising due care.
  • Number of cups of teas and coffees consumed by employees is rationed
  • Late stay transport is at fixed times and also drops provided to the employees both in late stay and regular transport is at fixed locations only
  • Plastic and paper cups are replaced by every one being given a mug that needs to be washed after every use
  • Quantity of food portions taken by an employee in the company cafeteria is rationed
  • Paper towels are not available in washrooms
  • Lights and AC are switched off or dimmed when not in use 
The above cost control measures should ideally exist in any organization at all times. As a matter of fact, resources should never be overused or wasted whether in the workplace or at home. This is very important in today's context where the sustainability of planet earth is at stake.

Unfortunately many organizations adopt these measures only when in distress (economic slowdown, recession, etc.). This may lead them to be viewed as aggressive by employees if introduced for the first time but without exercising due care. Cost control measures perceived as aggressive can vitiate the organizational culture if not managed nicely.

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