© Copyright 1994 by Chaim Yudkowsky, CPA, CITP, CGMA Checklist for some cost reduction opportunities

1. COMMON COST JUSTIFICATIONS
For Automated Systems
THE INFOLIST SERIES
Cost Reduction
 Fewer errors
 Fewer people handling data
 Eliminate waste related to inaccurate, obsolete, or overstocked
inventory
 Reduce inventory shrinkage
 Eliminate time wasted looking for information and/or inventory
 Improve the collections process
 Maximize cash discounts and reduce overlooked credits
 Reduce accounting and industry-specific consulting expenses
 Reduce staffing
 Minimize lost billings
 Improve cash flow (improve return on equity or reduce borrowing
costs)
 Improve quality and timeliness of financial reporting
Better Customer Service
 Improve on-time delivery
 Improve customer information and communication
 Improve quality of information about customer order status
 Reduce the time to research a problem
 Improve customer history retention
 Reduce out-of-stock situations
 Reduce customer returns
 Increase client creditability
Attract New Customers
 Offer new services or products
 Improve ability to market to mass niches
 Improve adeptness to quickly respond to unusual requests
 Improve the way prospects are tracked
Improve Employee Productivity and Employee Relations
 Improve effectiveness of employee communication
 Reduce receiving and shipping labor
 Reduce secretarial pool
 Reduce accounting department size
 Grow without increasing employee number
 Improve professionalism
This information is being provided simply to give you a
list of some common cost justification considerations for
implementing new technology. No final conclusions
about the best justification for your system should be
reached without further review and consultation with a
technology advisor. If you have any questions or
comments regarding any of the material herein, please
contact Chaim Yudkowsky.
© Copyright 1996 by Chaim Yudkowsky, CPA410-736-9875  cyudkowsky@byteofsuccess.com