New Initiative Helps Drive Cost Savings for the American Red Cross
CHARLESTON, SC–(Marketwired – November 28, 2016) – The American Red Cross is implementing new measures to reduce overhead costs at facilities throughout the country in an effort to operate as efficiently as possible and therefore be a better steward of donor dollars. As part of its most recent efforts, the Red Cross targeted its document storage expenses.
Off-site document storage is a considerable expense for many organizations, and the Red Cross is no exception; companies maintain large volumes of paper records for reference and archival purposes. Storing such files incurs a monthly charge based upon the volume of materials being stored, as well as storage conditions such as location, climate control, and other factors.
The recent initiative involved a comprehensive inventory of the documents being stored, as well as the costs associated with maintaining them. The audit identified large volumes of documents that were no longer needed and could therefore be shredded and disposed of to avoid incurring continued monthly storage charges.
“By taking a closer look at what we had in storage, we were able to identify over 10,000 cubic feet of paper documents that we no longer needed,” said Michael Schillinger, Director of Supply Management for the Red Cross. “In addition, we found over 2,000 cubic feet of documents that were being stored unnecessarily in a costly, climate-controlled facility, and we will be moving those documents to regular storage, which will also lower costs.”
In addition to saving money, these steps will yield significant environmental benefits. The amount of unneeded documents that will be shredded and recycled equals approximately 23 million pages, or 57 tons of paper. And moving documents out of climate-controlled storage will cause a significant reduction in round-the-clock energy consumption.
This document storage cost project was done in collaboration with SIB Fixed Cost Reduction, a contingency-based auditing and expense reduction consulting firm with experience optimizing third-party service provider costs for companies across all industries.
“It’s great to work with forward-thinking organizations like the American Red Cross that do not let the fear of deviating from the status quo stop them from improving their processes,” said Matt Cauller, Chief Operating Officer at SIB. “We were happy to lend our expertise to help facilitate the cross-departmental collaboration required to drive P&L cost savings within their long-term document storage spend.”
This initiative required close collaboration of Finance, Supply Management, and Operations, including about 50 different locations across the Red Cross, many of which have not worked together closely on such projects in the past. And by taking a more long-term, “One Red Cross” perspective, the Red Cross is creating additional efficiencies by standardizing services and adopting new ways of working to avoid unnecessary expenses with third-party service providers.
“This initiative not only reduces recurring monthly costs, but it also reduces the risk of incorrect document storage,” said Thomas Nash, Head of Supply Management. “And equally important, this work literally pays for itself.”