Here’s a hard truth for most manufacturing firms. You’re not managing the supply chain when it comes to your employees’ benefits, which means you’re losing money. The question is not if you’re losing money in your health plan. It is, how much are you losing?

As the CFO of a manufacturing firm, we don’t have to tell you that companies are buying and selling their businesses based on a multiple of EBITDA, earnings before interest, taxes, depreciation and amortization. What you likely don’t know, however, is you’re leaving money on the table if you don’t take an analytic look at each firm’s employee benefit strategy in the process of evaluating your merger or acquisition.

Does it make sense to have a non-P&L manager in charge of a top-three business expense at your manufacturing firm? Most CFOs would say, “Of course not!” But, that’s what manufacturing companies are doing every day by giving HR departments carte blanche over the firm’s benefits expense.

When it comes to improving the performance of your manufacturing firm’s health plan, it’s not what you buy, but rather how you buy it. Are you managing your healthcare supply chain with the same efficiency and effectiveness that you use to run your business supply chain?

Employee benefits are a top-three line item for most companies, but many employers have given up on this category of expense. Accepting defeat, they plan on annual 10 percent, 20 percent, even 30 percent or greater rate increases as the inevitable reality of their benefit plan performance. But top manufacturers have a different perspective, managing the expense the same way they manage all other costs of doing business. Benefits are an asset — and they need to perform like one.