Mopping up Pareto's 20%
Article Abstract:
A reassessment of existing purchasing policies can assist organizations in reducing wasted money on capital investments and generating substantial savings. Touche Ross and Co is one firm that set out to examine its purchasing scheme to account for the 20% of wasted money that according to Pareto's Law is most often ignored by companies. The cost-effective management of Touche Ross' computer consumables meant a rationalization of its central purchasing policy to formulate a suitable contract for prospective suppliers. The Little Red Book UK Ltd was chosen by Touche Ross as the ideal supplier based on financial stability, quickness of response and management quality. The supplier adopted a purchasing system that made use of a customized product selection manual, direct delivery to end users, and a centralized invoicing system. This purchasing system generated savings of 30% on product prices and 15% on administrative and accounting aspects.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1992
User Contributions:
Comment about this article or add new information about this topic:
When does a headache become a disaster?
Article Abstract:
The dependency of business on their computer systems has increased the potential disastrous affects of computer system failure. There are four scales of disaster: systems denials; machine room denials; building denials; and site access denials. The solutions to disasters includes having a subscription to either: a hot-site service; a mobile service; or a cold site service. Research reveals that a mobile site adequately covers 4.5% of all disasters while a cold site service covers 18.2% of disasters. The hot-site solution provides 100% protection for all types of disasters, and while it is more expensive than the other options, offers superior value for the money.
Publication Name: Accountancy
Subject: Business
ISSN: 0001-4664
Year: 1990
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: Mr Brown's dilemma. Why delay can be dangerous. The grim message of the consumer paradox
- Abstracts: Building up a reputation. Follow your leader. Brixton
- Abstracts: An empirical assessment of the residual income valuation model. Accrual reliability, earnings persistence and stock prices
- Abstracts: Mapping With Atlas. Going On-Line: Dialog and the Census Bureau. Spreadsheets
- Abstracts: Technological togetherness. A simple guide to complex systems. Choosing a System That's Right for Your Practice