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Hello,

 

Interesting
thread.

 

I assume
this  relates to increasing efficiency to
‘keep the wolves at bay’.

 

The graph
might well be hyperbolic with the X axis approaching the ‘marginal cost’ before
a ‘step function’ kicks in ie increase staff/tooling one or both. However, the
private sector, which is primarily profit driven, will also plot the inverse
hyperbolic graph, the increase in ‘total’ profit as unit cost decreases. Martin
mentions the ‘sweet point’ on the hyperbolic X axis, I would suggest that the ‘private
sector’ ‘sweet point’ is further along the X axis close to the ‘step function’
point and therefore associated with a higher workload. Whilst cost is important
it’s not the only tool in the private sectors’ armoury to increase profit cf
market share.

 

If the
‘public sector’ wishes to compete with the ‘private sector’ it will need to
approach the ‘private sector’ targets such that a private sector predator would
have to consider increasing the ‘price’ to achieve a profit, which would not be
an attractive proposition although a short-term loss maybe acceptable for a
medium/long term profit.

 

This is Tiger Territory as unfortunately the playing field
isn’t flat.

 

Good Luck

 

John Martin
(fortunately retired)  

 		 	   		  
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