God's Week Has 7 Days
| Recent Articles... | |
| · | A Parable Of Rude Awakening (Dec 26) |
| · | Do You Hear What I Hear? (Dec 19) |
| · | Oom-Pah-Pah (Dec 12) |
| · | What's The Real Cost? (Dec 05) |
| · | What If . . . ? (Nov 28) |
| · | Explosive Profit (Nov 21) |
| · | Blueprint From Above (Nov 14) |
| · | A Hand Of Welcome (Nov 07) |
| · | (Oct 31) |
| · | The CEO As Pastor (Oct 24) |
| · | A Hiding Place Of Gray (Oct 17) |
| · | The Monday Connection (Oct 10) |
|
More God's Week Articles... Preface / Forward About the Author |
What's The Real Cost?
Dec 05
Call me slow, but I had never heard the term full-cost accounting until a few years ago. It is a mystery how I survived so long without it.
The other day I had a chance to use it. In a discussion of a business proposition that had some risks involved, I heard myself saying, Let's look at the full costs of this.
Actually, I've known the theory, if not the terminology, since youth. When I bought my first new car, my father patiently explained that there would be other costs besides gas and oil. There would be insurance, registration, upkeep, andthe big onedepreciation. So a weekend trip became more than just a few tanks of gas. Full-cost accounting produced the hidden horror of several extra cents per mile.
Many of us who are associated with business know about full-cost accounting. We know what goes into the price of a product, at least the tangible costs of design, materials, labor, storage, marketing, transportation, and so on.
Not all of us practice real true-cost accounting, however. We may calculate our own direct expenses without figuring the social cost to other stakeholders who may also pay a price. Employees pay a price for unfair, unhealthy, and hostile work environments, such as when supervisors yell at them or harass them. The family of an employee pays a price if workplace stresses and irritations are brought home. Other taxpayers pay a price if the business receives subsidized support services. The community and future generations pay a price if effluents are not disposed of properly.
In his book Small Decencies , John Cowan tells of a corporate officer who casually said he'd have to dump a few divisions to get his company back on course. Whoa! Dump a few divisions? But what about the hordes of employees who would be thrown out of work? Cowan writes,
How many pregnant women would hear that their husbands no longer had health insurance? How many young men and women would have to change their choice of colleges? How many bicycles would not be bought for Christmas? How many families would have to try to live on a welfare check? How many men would struggle not to think of themselves as useless? How could a perfectly nice man, a well-mannered gentleman, fail to factor these elements into his assessment of the situation?
Like many of us, this corporate officer didn't bother to consider the effects on others who found themselves caught in the lengthening shadow of his actions.
An outplacement executive recently complained that some firms are now paying the price for their layoff binge of a few years ago. He said the passion to be lean produced corporate anorexics whose creative juices have dried up. Somewhere, full-cost accounting was neglected.
A long time ago, Jesus talked about counting the cost. Interestingly, he used a business illustration. Suppose one of you wants to build a tower. Will he not first sit down and estimate the cost to see if he has enough money to complete it? (Luke 14:28, NIV). The message to his disciples was that the cost of following him might be higher than they thought.
Of course, Jesus didn't really mean business.
Did he?
God's Week | Preface | Forward | About the Author
Print
Email
