Are operating costs putting a crimp in your P&L statements? One way to control overhead and stimulate efficiency among your employees is to run a contest for the best cost-cutting suggestions.
Cedartown Paperboard Co., a $20 million paper converter in Cedartown, Ga., will save about $80,000 this year through BAD (Buck-a-Day) Ideas, a contest it ran last March among its 180 employees. BAD encourages employees to pass in an idea that will save at least a dollar a day at their particular job. People with an accepted idea are awarded a mug that says, "I had a BAD Idea." A second accepted idea wins a rubber dollar, symbolizing how far a dollar can be stretched.
Employees are asked to submit ideas to their supervisor who selects the best ones that can be implemented immediately. More complex ideas are funneled for review to a temporary implementation committee.
Copyrighted and marketed by Industrial Motivation Inc. of New York, the BAD programs cost about $25 per employee and take four weeks to run. Industrial Motivation provides all the materials, and guarantees that savings will exceed the cost of the program, or it will refund the difference.
Drivers of Cedartown's 13 tractor-trailer trucks suggested that they take advantage of oil company discounts by paying cash, rather than using credit cards, for diesel fuel, for a savings of roughly $10,000 a year. Another yearly savings of $10,000 will be realized because an employee observed that three men were assigned to a piece of equipment similar to one operated by only two men. A more efficient use was found for the extra man. "We've had very encouraging results," says Cedartown vice-president Reed Freeman.
Kinney Vacuum Co. of Canton, Mass., expects to save more than $57,000 a year through BAD. Kinney's 153 employees handed in a total of 264 ideas. Many suggestions were merely common sense, such as replacing an inaccurate shipping scale for a savings of about $300 a year. One employee suggested that his foreman, who left, not be replaced. The company agreed that a replacement wasn't needed. "The BAD program saved money and improved interaction between management and the work force," says Albert Smegal, Kinney's vice-president of manufacturing.
According to George J. Schmidt, president of Industrial Motivation, "Of the 2,500 companies that have used Buck-a-Day, only 2 have requested a refund. Almost any type of company with 100 or more employees is suited for the program. The common ingredient is just people."
For further information on BAD Ideas, contact Claire Yancey at Industrial Motivation, 331 Madison Ave., Room 508, New York, NY 10017.