Two programs – one objective

Cost Control And Cost Awareness Programs

In today‘s competitive manufacturing environment, there are continued pressures to lower unit costs of production and at the same time, achieve world class quality standards.

Hermes manufactures and offers industrial abrasive users a complete line of high technology products which assist these efforts. However, effective long term servicing of total requirements entails providing quantitative benefits beyond those which may be demonstrated on the basis of product performance alone.

Reduction and Containment of total Abrasive Costs

Increasingly, our customers have come to rely upon our Cost Awareness and Cost Control Programs which take full advantage of technological improvements in the areas of product, information processing, data collection and statistical evaluations of process variations.

These innovative Programs provide for verifiable means of achieving productivity improvements; allow for measurement of efficiencies of value added processes; and most significantly, contribute towards the reduction and containment of total abrasive costs for processing finished products.

Simply put, the Programs provide an engineered system of products‘ and services‘ delivery and benchmark costs in a meaningful way.

The three basic elements

1. Inventory Control

All agreed upon purchase items are issued from a consigned inventory located at customer‘s facility. In addition, non-stock items are made available within specified delivery time periods.

The inventory is monitored at the units of issue level, providing for tracking of usage by application. Detailed listings according to item, consuming department, price per piece, and average monthly consumption rates are tabulated and updated monthly. Regulary scheduled Seminars are then conducted so that a structured review of consumption figures and discussion regarding previous month‘s performance objectives may be achieved.

2. Process Control

Hermes‘ successful track record with key customers has always been dependent upon ensuring that the most cost efficent products are in place at each Consuming Department‘s regulary used Work Stations/Production Lines. „Cost efficient“ is defined as those products which provide for an economical and productive manner of accomplishing agreed upon application requirements. Our Industry and Account Managers work diligently to provide for regular dialogue and information exchanges with customers‘ key production and management personnel, and are tasked with testing and reporting upon all new products and applications.

3. Process

At the core of all cost containment efforts is of course, the customer‘s own processes and methods. Successful system implementation is made possible when goals and objectives are shared, and where an environment of interdependence is truly desirable and mutually benefical.

Cost Awareness vs. Cost Control

1. Cost Awareness Program

Agreement to  index abrasive costs against a unit of output.

2. Cost Control Program

Contractual arrangement, indexing abrasive costs against the value of finished product produced. Commitments are guaranteed through invoice adjustments if specified obligations are not achieved.

Getting started

Both Programs start with a complete Plant Survey. Applications and operations are reviewed by a cross-functional team of Hermes employees, with opportunities for reducing waste and total abrasive expenditures identified.

The current status quo is then indexed and measured improvements against agreed upon parameters form the basis of an ongoing Partnership.

Either Program affords a level of commitment, deliberateness, and capability unmatched in the abrasives industry. We would welcome an opportunity to work with you to customize and install the Program which best suits your needs.

To get started, or obtain more information, contact your local Hermes Abrasives Account Manager, or call 1 (800) 464-8314.