Business and Management: Improving Profits By Reducing Rework

Reducing rework, i.e., revising completed work to meet the goals of the project, can increase profits, morale and productivity. Rework not only impacts the budget directly for the time spent, it also diverts resources from other profitable work. The true cost is the direct cost for the time and equipment to accomplish the rework, plus lost opportunities because these resources are unavailable for new work. A firm with a profit margin of 10% needs 10 hours of billable work to make the same profit as reducing one hour of rework.

Citation: ASHRAE Journal, vol. 45 no. 11, November 2003



Product Code(s): D-20841