8 home truths

1    Profit should always be the first charge against sales. This determines the costs that the business can afford.

2    Any business that does not constantly emphasise profit will ultimately make a loss.

3    Any organisation, system, procedure or individual left undisturbed for three years will become inefficient.

4    Managers should treat all overhead costs as variable. If volumes fall, overheads should be cut: if volumes rise, overheads should be held.

5    People tend to elaborate rather than simplify their work.

6    Human resources functions (tend to) cluster on tasks that have a minimal impact on profitability.

7    Any activity managed only on technical criteria will be unprofitable.

8    The optional extras demanded by people can double the costs and timescale for any development.