Executive Summary


There are real cost savings and there are phantom savings. Real cost savings flow to the accounting system and appear on the books, whereas Phantom savings show up on reports and but can never be tracked to the accounting books. A few examples of phantom savings are: Reduction of labor without realizing any savings, small reductions to energy usage, small reduction to production machine usage, reduced compressor usage due to leaks being fixed. Phantom savings can really be used for important work it’s just that the ROI will show up as a result of the work we actually do and not from the savings activity. The situation of phantom savings might be worse and then just no savings shows up on the books.