Although the global economy is recovering, it's doing so at a snail's pace. Manufacturers from the Pacific to the Atlantic have raised production standards and quotas while trying to cut down on the cost of doing business. As a result, organizations are reviewing their financial benchmarking in order to deduce what expenses can and cannot be afforded.
A different form of public assistance
In the United States, some government authorities are creating incentives to bring jobs to impoverished and economically struggling cities. According to Industry Week contributor Charlie Spies, the federal New Markets Tax Credits program has attracted capital to multiple businesses looking to construct new factories, purchase new equipment or obtain software capable of giving executives a comprehensive view of the procurement process. In addition, manufacturers participating in the movement help invigorate struggling communities.
Spies cited Horsehead Holding, a Pittsburgh, Pa.- based company specializing in manufacturing zinc products, as an example of a company that has encountered success with New Markets. In 2009, the enterprise was looking to build a plant to recycle electric arc furnace dust, a hazardous byproduct of minimill steel production. In an effort to bring jobs to Barnwell County, S.C., a community with poverty rates exceeding 20 percent, Horsehead received $10 million through the program's allocation from CEI Capital Management and Bank of America. The location has since acted as a pivotal part of the zinc producer's strategic sourcing protocol for EAF dust.
Investing in the digital platform
Many organizations are reporting success with software programs and other management tools that assist them in finding the most affordable, quality materials. Other technologies such as data analytics and cloud computing have contributed to the growth of these and other similar systems. According to Manufacturing Business Technology, process automation tools have eliminated losses incited by poor organization and outdated office management practices. The average U.S. office worker loses nearly 40 hours a year looking for lost or misplaced items. That's a full work week that could be spent enhancing production rates.
The news source noted that overall cost savings are also expected, along with waste elimination. After implementing an electronic data management program, R.J. Reynolds Tobacco witnessed a 53 percent reduction in invoice processing expenses as well as a 16 percent increase in transactions. Frito Lay saved somewhere between 30,000 to 50,000 work hours per year.
Automation tools have the ability to streamline a business' transaction process, effectively resulting in more free time that can be spent on producing actionable data.