| Source: Accounting Office Management & Administration Report
Following are the most frequently mentioned areas of cost control by controllers of 250 companies that participated in a survey by IOMA. The following tabulation is reprinted with permission from IOMA.
|
Most Critical Cost-Control Areas for 2006, by Number of Employees |
|
|
Overall |
Fewer
Than 250 Employees |
250 Employees
or More |
|
|
2006 |
2005 |
2006 |
2005 |
2006 |
2005 |
|
Purchasing/materials costs |
60.8% |
51.5% |
59.6% |
53.2% |
62.0% |
48.9% |
|
Health care benefits |
45.3 |
55.7 |
57.4 |
70.2 |
40.8 |
42.6 |
|
Inventories |
45.3 |
30.9 |
42.6 |
23.4 |
49.3 |
36.2 |
|
Manufacturing/production costs |
43.8 |
39.2 |
36.2 |
36.2 |
47.9 |
40.4 |
|
Capital expenditures |
42.2 |
42.3 |
46.8 |
34.0 |
36.6 |
51.1 |
|
Professional services costs (consultants, legal, accounting/auditing, banking) |
35.9 |
35.1 |
29.8 |
29.8 |
40.8 |
38.3 |
|
IT expenditures/budgets |
30.5 |
18.6 |
27.7 |
14.9 |
31.0 |
23.4 |
|
Sales and marketing costs |
25.4 |
22.7 |
25.5 |
25.5 |
25.4 |
19.1 |
|
Advertising expenditures/budgets |
25.8 |
27.8 |
27.7 |
29.8 |
22.5 |
27.7 |
|
T&E |
25.0 |
25.8 |
21.3 |
25.5 |
26.8 |
25.5 |
|
Compensation |
23.7 |
33.0 |
23.4 |
36.2 |
23.9 |
31.9 |
|
Use of outsourcing |
19.4 |
25.8 |
19.1 |
23.4 |
19.7 |
27.7 |
|
Downsizing/rightsizing |
19.4 |
13.4 |
19.1 |
8.5 |
19.7 |
17.0 |
|
Property/casualty insurance |
17.2 |
20.6 |
19.1 |
27.7 |
16.9 |
14.9 |
|
Workers' compensation |
13.3 |
20.6 |
08.5 |
23.4 |
16.9 |
19.1 |
|
R&D |
09.4 |
07.2 |
06.4 |
2.1 |
12.7 |
10.6 |
|
Pension plans |
07.0 |
06.2 |
04.3 |
08.5 |
09.9 |
04.3 |
|
Retiree benefits |
03.1 |
01.0 |
00.0 |
00.0 |
05.6 |
02.1 |
|
Other |
06.7 |
11.3 |
06.4 |
10.6 |
07.0 |
10.6 |
|
|
|
|
|
|
|
|
|
(Source: IOMA) |
|
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|
|
|
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From Accounting Office Management & Administration Report, July 2006, p..1. For subscription information contact Institute of Management & Administration, Inc., 3 Park Avenue, 30th Floor, New York, NY 10016-5902. One-year subscription $349. 212-244-0360, [email protected]. For the complete article, click here.
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