Why Spend more than Needed?

2/18/20231 min read

The prosperity of an Enterprise or Individual is determined not by his earnings but by the surplus the entity generates at the end of a certain period, the period may be in a day, weeks months or years.

Even if the revenue is in crores but expenses exceed the revenues, the entity may not have enough to pay any of its obligatory dues and the business becomes a loss-making venture.

The way to avoid this fate is by managing total expenses less than revenues. While many companies try to boost revenues, if expenses are not cared for, every additional unit sold adds to the losses, aggravating the position further.

Expenses keep on increasing due to increases in input costs, decrease in efficiency of man and machines, complexity, complacency, and creep all making the cost of a unit produced more than before. Unfortunately, revenues do not keep pace with cost rises, thus narrowing the profits before finally slipping into the red.

How to avoid this loss-making situation and sustain and grow for years.

TATA, Birla group companies, Kalyani Group, and Bajaj are some of India's leading companies which have withstood the onslaught of time and thrived. How could they do it while many faltered on the way?

The answer is their unending quest for finding alternatives to the existing, either as Innovation or Reengineering or Reverse engineering all resulting in a permanent reduction in consumption or increasing the utilization. Never satisfied with the existing condition and continually looking for an alternative to improve is the hallmark of the companies which thrive in this Era of uncertainty. This Method Helps to not Spend More Than Needed. It's a never-ending process as There is always a Better Way. More iterations lead to excellence as the famous saying from Winston Churchill goes.

" To improve is to Change,

To be perfect is to change often".

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