SGM to win the first battle of cost reduction this year

SGM conscientiously implemented SAIC s guideline of standing to the test of winter without fearing the chill . The EXCOM of SGM required all its employees to further change their way of thinking, overcome the mentality of shrinking from difficulties, get ready for a protracted struggle and continuous improvement, make a good annual budget and take it as the first battle that SGM should win in the effort to reduce the cost for higher efficiency in the year.

While setting the annual sales targets and sales income for a steady growth this year, the EXCOM also worked out measures to control the cost, reduce the expenses and cut the expenditure. The top management of the company not only took the lead in taking the economy class air flight only and in lowering the lodging standard, but also held the 2008 annual summary and commendation meeting in an internal workshop instead of renting a conference hall outside the company, so that the expense was reduced and a good example was set up.

The expenditure on the annual supplier conference 2009 was only a third of the expenses of the previous years. In addition, it was also the first time ever for the annual dealer conference of the 4 brands to be held in a combined manner. Apart from such factors as price increase, the budgets for all the departments are lower than the actual level of last year, of which the consulting budget, business travel budget, training budget, hospitality budget, conference budget, etc.

are reduced by 20% from those of last year.

The planning department of SGM has worked out targets to optimize the inventory, developed action plans for the stock, and constantly improved the OTD process by shortening the OTD cycle via the manufacturing, logistic, purchase and other business links. The manufacturing department has continued to cut down the manufacturing expenses by lowering the labor cost with more project outsourcing and by re-making the production arrangement for higher efficiency.

The sales department has stepped up efforts for elaborate business management focusing on improving the dealer capability, taken effective measures to increase the efficiency of spending on the media, and also optimized the use of various commercial expenses. Taking both the global and local projects as the carrier, the engineering department has enhanced the R&D capability for key technologies, noticeably reduced the R&D cost, and helped the manufacturing department to promote the benchmarking of manufacturing processes, equipment and ergonomic planning to achieve a continuous improvement of manufacturing efficiency.

The human resource department has re-examined the outsourcing projects, reduced expenditure, speeded up integration of training resources and cut down the training cost. The IT department has substantially reduced the annual maintenance expenses by way of outsourcing and the DIY approach.