Harvard Business Review

DECEMBER 21, 2011

Within the first year of our effort net sales increased 27 percent while fixed costs were reduced by 40 percent. Not all fixed cost reductions were people. This success is an example of how, when properly applied and executed, HR can have a significant and measurable impact on a company.

Fixed Costs 16

Fixed Costs Staffing Recruitment Sales 16

Harvard Business Review

OCTOBER 29, 2015

This makes financial sense in industries with high fixed costs and low variable costs: larger sizes enable the company to charge higher prices that, even if they are just slightly larger, absorb a higher portion of fixed costs, while reducing packaging cost per volume and attracting value-minded consumers.

Fixed Costs 14

Fixed Costs Variable Costs Marketing Sales 14

Harvard Business Review

NOVEMBER 30, 2018

Capital-intensive factories have a high-fixed-cost, low-variable-cost operating model. If you greatly reduce the production volume, the cars that do come out have to absorb more of the fixed costs, and that eventually sends the product into a profitability death spiral.

Fixed Costs 14

Fixed Costs Assets Cash Flow Variable Costs 14

Harvard Business Review

NOVEMBER 12, 2012

We've previously argued why employees benefit by staying with the same company for at least 10 years. By making the fixed cost of payroll inherently more variable under differing business conditions, you can make your company more resilient and agile, while also treating your employees exceptionally well.

Fixed Costs 14

Fixed Costs Workflows Revenue Compensation 14

Harvard Business Review

OCTOBER 27, 2016

A full-time job provided the steady income needed to support our traditional version of the American Dream: the highly leveraged, high-fixed-cost house; the cars; the latest consumer goods. Both workers have low wages, no benefits, and limited rights and protections.

Insurance 14

Insurance Reorganization Fixed Costs Benefits 14

Harvard Business Review

DECEMBER 10, 2012

Without these conditions, the music stops, and the benefit of leverage becomes a huge liability. Regardless, a financing component adds another fixed cost. The second is that the asset underlying the leverage holds its value. As leverage accentuates the profit when asset values rise, it decimates return when values fall.

Assets 15

Assets Fixed Costs Revenue Benefits 15

Harvard Business Review

FEBRUARY 11, 2016

McKesson, the US-based pharmaceutical and health-care giant, benefits from external expertise as a strategic extension of its resources in areas such as business strategy and logistics support. But there are also extrinsic factors that complicate the relationship. Internal-external competition. Clash of expectations.

Administration 14

Administration Fixed Costs Benefits Manager 14

Harvard Business Review

JULY 20, 2011

A succession of CEOs prior to Rick Wagoner (who fought heroically to overcome the dreadful hand he was dealt) allowed all manner of legacy costs to build up (retiree health, Jobs Bank, etc.) and those largely fixed costs were more painful and debilitating if GM shrank in the U.S. — as it did — than if it grew.

Fixed Costs 14

Fixed Costs Banking Advertising Marketing 14

Harvard Business Review

MAY 2, 2013

The key components that lead to a solution are as follows: Understand the dynamics of a high fixed cost/low variable cost industry. While pharma companies spend billions on research, the actual cost of manufacturing a treatment (such as a pill) is minimal. This cost structure enables pricing flexibility.

Variable Costs 10

Variable Costs Fixed Costs Cash Flow Revenue 10

Harvard Business Review

JUNE 4, 2015

Since theme parks are high fixed cost/low variable cost entities, revenue from discount-enticed new customers is virtually all profit… free money. ” There are plenty of other industries–such as restaurants, barbershops, and health clubs–that can also benefit from surge pricing.

Variable Costs 12

Variable Costs Fixed Costs Implementation Travel 12

Harvard Business Review

AUGUST 8, 2014

So to cover his monthly fixed costs of student loan payments (on more than $100k in debt), rent, and health care he was driving for Uber. They’d benefit my Uber driver, and lots of others like him. He estimated that he spent more than 60 hours a week behind the wheel. But we might also need other ones.

Fixed Costs 14

Fixed Costs Project Management Education Accounts 14

Harvard Business Review

JULY 12, 2018

A second important deficiency arises from the fallacy that a cost-plus price is guaranteed to cover costs. Cost-plus prices provide no guarantee of covering costs or earning a profit. The Strategic and Tactical Benefits of Cost-Plus Pricing. Cost-plus pricers don’t face this risk.

Fixed Costs 12

Fixed Costs Transportation Implementation Marketing 12

Harvard Business Review

NOVEMBER 15, 2018

obstetrics, orthopedics, cardiac care) that could benefit from consolidation. In larger facilities, there is often an astonishing proliferation of special care units, ICUs, and quasi-ICUs that are expensive to staff and have high fixed cost profiles. They also do not represent sustainable, long-term change.

Hospitality 14

Hospitality Manager Nonprofit Staffing 14

Harvard Business Review

MARCH 16, 2017

A drug company must incur a large fixed cost to do the basic research, so it has strong incentives to predict what the demand for the drug will be if its research succeeds. In other words, climate skeptics don’t just stymie progress on climate policy. They ensure that would-be climate entrepreneurs have less incentive to invent.

Real Estate 12

Real Estate Fixed Costs Marketing Benefits 12

Harvard Business Review

APRIL 6, 2016

Two companies jointly invest in the takeover of a pricey asset, and subsequently benefit from its joint use. Another risk is the opportunity cost of not benefiting from lower investment costs. For example, the build cost of an oil rig at the bottom of the cycle may be 40% below the cost at its peak.

Assets 12

Assets Operations Insurance Telecommunications 12

Harvard Business Review

APRIL 5, 2017

However, firms can efficiently increase margin growth without much revenue growth by managing to squeeze out their fixed costs to service the same level of output. For instance, Home Depot, despite a painful housing market–led recession, retained most of its hourly workers and their benefits in 2008–2009.

Metrics 11

Metrics Cash Flow Revenue Compensation 11

Harvard Business Review

DECEMBER 1, 2017

So not only were the current fees too weak to support his fixed costs, but future clients were turned off by his apparently excessive tastes. To address those cost overruns, Colin subleased some space, cancelled a redundant and very expensive trading service, and let one person go.

Revenue 10

Revenue Fixed Costs Staffing Accounts 10

Harvard Business Review

MAY 28, 2018

For its part, Nikon focused on cost optimization opportunities and balance sheet management when communicating to value-oriented investors and on long-term structural changes when communicating to growth-oriented investors. It also called for streamlining headquarters and cutting executive management’s compensation.

Balance Sheet 11

Balance Sheet Cash Flow Banking Fixed Costs 11

Harvard Business Review

NOVEMBER 18, 2013

The advantages that hospital systems can derive from scale fall into four groups: Classic economies of scale focus on lowering the cost per unit of care delivered (e.g., Deals such of these often result in considerable economies of scale and skill but at a high cost and with significant implementation risk.

Hospitality 9

Hospitality Scaling Revenue Fixed Costs 9

Harvard Business Review

MARCH 1, 2018

Because sicker patients are more likely to be unprofitable, insurers try to push them toward competitors’ plans by designing plan benefits (e.g., And elderly and disabled Americans choose from competing private prescription drug plans for their drug benefits in the Medicare Part D program. Problems may get worse.

Insurance 8

Insurance Marketing Administration Fixed Costs 8

Harvard Business Review

NOVEMBER 6, 2013

Working under a fixed-cost ceiling was, of course, difficult. If some of the early proponents of accountable care are correct that the Affordable Care Act will lead to a transition in payment models from fee-for-service, through bundled payments, and towards fixed budgets, then U.S.

Hospitality 8

Hospitality Insurance Fixed Costs Accounts 8

Zenefits

JULY 31, 2022

Simplify benefits administration. Simplify benefits administration. Managing inflating costs can be difficult for companies, particularly with high fixed costs like infrastructure or manufacturing. This can include reducing overhead expenses or finding new markets where cost is a lesser factor.

Manager 52

Manager Onboarding Banking Process Improvement 52

AIHR

APRIL 20, 2023

Inspite of this, organizations have created the perception that learning is a benefit, or a privilege provided to employees as part of employee engagement and retention strategies. The majority of budget resides in fixed costs related to headcount.

Sales 98

Sales Sales Fixed Costs Marketing 98

AIHR

NOVEMBER 12, 2024

Blending different types of employment can help plug this gap by tapping into broader talent pools while also reducing costs, boosting agility, and nurturing future talent. This article looks at 21 different types of employment and how they can benefit your organization. Benefits: Benefits vary based on company policies.

Insurance 98

Insurance Staffing Compensation Benefits 98

Harvard Business Review

JANUARY 5, 2017

To the question, If the media were to cover the election again, with the benefit of hindsight, could we expect anything different ? The media’s bias toward big events stems from three features of its economics: Fixed costs. The cost of covering a golf tournament doesn’t depend on whether Tiger Woods plays.

Media 15

Media Advertising Fixed Costs Marketing 15