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Cost Reduction Program

The term cost reduction program can apply to anything from prescription medicine, to college tuition rates, to business operating expenses, all the way to the costs of war. No matter how it is applied, the basic idea of a cost reduction program is to do just that: reduce costs, whether it is for the consumer, student, CEO, or the American citizen. When referring to medicine, the government and many pharmaceutical companies often propose cost reduction programs to help patients with the ever-growing costs of prescription medicine. Many times this includes rebates or reduced costs after the initial prescription for each refill thereafter. These methods can be extremely helpful for chronic patients who constantly need medication. In the context of business, cost reduction programs are implemented to eliminate overhead costs and increase profits. This method can include purchasing less office supplies, all the way up to laying off workers. The bottom line for businesses that implement a cost reduction program is just that: reduce any and all unnecessary costs in order to see higher profits.

The term cost reduction program can also be applied to the United States government. This idea is to put a cap on the price of going to war, which can sometimes include the closing down of military bases. Robert McNamara was famous for implementing a cost reduction program in the 1960's, which caused some bases to close. Although the move caused some controversy, it saved the US some serious money by cutting down on excess costs of operation, in order to focus those costs on the Vietnam War. A cost reduction program can be a good way to help those in need, or it can be negative, depending upon the situation. Either way, the person or persons who implement the program usually benefit in some way.

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