If your costs are lower than all of your competitors, you’re in a much better position than they are to weather a financial storm.  You’re also in a better position in the good times as well. An athlete processes food and oxygen and turns it into energy much more efficiently than I do. Money is the food and oxygen of a company and you need to process it as efficiently as possible.  Some companies have done this to an uncanny science.  Aldi Foods is a great example of a company that’s done this perfectly in grocery retail.  Where a normal grocery store has 70,000 SKUs (different items), Aldi has 1,400. They eliminate any features that raise cost without providing substantial benefit. Southwest Airlines does the same thing.  Their flight attendants clean up as the plane lands and reduce the airplane’s on-ground time.  Flying planes make money, planes on the ground don’t.

You don’t have to be a low price leader to focus on efficiency.  Apple Computers isn’t thought of as cheap in any sense of the term.  But they’re very efficient at producing new, innovative, appealing products very quickly.  They push products to market quickly, and then, as Guy Kawasaki says, they “churn, baby, churn”. Maybe even more important, they never stop. Just three weeks after Apple introduced its groundbreaking iPhone, it was back with a shuffle version.

So what around you is inefficient? You don’t have to be a CEO or manager to initiate process improvement.