In any production environment the more efficiently you can use your raw materials the better it is for your bottom line and environmental sustainability. A majority of the raw materials that are used in today’s products that are not from organic sources are what you could consider a finite material. Meaning what is currently on this earth is all that is available to us. That is compounded with the ease of access to these materials. I am sure you have heard about rare earth minerals that are used in making todays technological tools like phones and TVs. The name rare earth minerals gives the wrong impression. The minerals are actually quite common in the earth’s crust they just are not often concentrated in a manner that makes mining them economical. So, though it is often though that by being sustainable are incurring more costs. That may be true of the upfront costs but not the long-term costs. If you harvest the easy to find copper that leaves you with the harder to harvest copper. Same with other commodities like fish and wood. As soon as you add on more labor costs or processing costs the amount you will end up paying for that raw material.
I would point out that we are probably not going to stop consuming most of the raw material resources that are currently being utilized. Yes, there are people out there working on technologies that might change some of the resources needed but we need to look at how we can save money now and in the future. I would say that one of the ways of not occurring those costs is to be more efficient and effective in the current uses of those resources. Optimizing your process may increase your overall costs currently but
by looking at how your company uses the raw materials they need from the cradle to the grave to build product you would be able to do a cost analysis of your current process and one of an optimized and updated process and be able to determine what the return on investment is. Once you have done this you’ll be able to address certain questions and manipulate your model. What price point does a raw material need to hit to make the optimization happen sooner? What price does the raw material need to stay at to keep your current processes in place? Once you have the data you and your organization will be able to make an informed decision about how to save your organization time and money in the long run by increasing its efficiency.
Comment below and tell me how you change a process to save money and be efficient?