In a tough economy, industries with tight margins are looking for new ways to save money. Talk about lean is on the rise (see the recent MDM case study Lessons Learned on Lean) and experts are chiding some executives for not taking the need to make changes to heart. (Here’s what economist Alan Beaulieu recently said, as published in the MDM Blog this summer.)
 
Even in that light, R. David Yost, CEO of drug distributor AmerisourceBergen, has taken cost-cutting to a whole new level. Yost’s efforts to keep spending in line -including answering his own phone rather than relying on a secretary -recently were featured in an article from Businessweek.
 
Travelling employees now have to fly coach unless they pay for their own upgrade, and reservations must be made 30 days in advance to get the best prices. Even Yost’s office chair -inherited from the previous CEO when Yost took over in 1997 -sets an example of where costs can be cut.
 
The idea of little things adding up isn’t a new one, yet so many people still have a hard time accepting how far each small step can go. A former employer of mine used the example of 35 cent pens to get the point across to the nearly 50,000 employees in the company. If each employee used one fewer pen each month (in other words, lost one fewer pen each month), the total savings to the company would be $17,500 each month. While that may not seem like much for a multi-million dollar corporation, that one month of savings was nearly my yearly salary at the time.
 
Granted, saving a pen isn’t going to save the company in times of financial crisis but maybe all the little things can help bring that bottom line up just a little bit. Such measures could make a difference in weathering the tough times.