Limiting Manpower Costs

Even if you’re not an owner or president of a company, as a supervisor, you should have an interest in improving the profitability of your company. After all, the more successful your company is, the more opportunity you have!

There are two major categories of manpower expense: the number of people and the rates of pay. As the following chart indicates, your objective should be to operate with as few people as possible, which will result in higher profits, so you can pay   your employees above average.

Limiting manpower cost

To operate with fewer employees you have to have above average, experienced people. If you pay above average you should reduce your turnover and will, as a result, have more experienced people who can do more. Also, if you pay according to performance your best people will stay and the poor performers will leave. Then the next step is to not replace one or two of them. Since they have not been contributing or producing that much, the work will probably get accomplished just as well without them.