Golden triangle principle in dividing remedial efforts into three main areas , namely :
1. Wasteland is a foot or bottom of the triangle . 70 % investment of time ( or attempts ) only provides improvements (yield ) of 10 % . Unfortunately , this area is often gained major attention from managers industry as a consequence of the unplanned efforts.
2. Low yield is the center of the triangle . 20 % investment of time ( or effort ) to provide improvements (yield ) of 20 % . The third area of the triangle , this area is a work area that is most frustrating for industry managers , because managers want results a great improvement , but little that can be done .
3. Golden triangle is the top of the triangle , a 10 % investment of time ( or effort ) to provide improvements (yield ) of 70 % . Managers who have the knowledge and commitment to continuous improvement will focus attention on the work area ‘s golden triangle . In connection with the cost reduction program continuously , should the industrial management seeks to investigate the activities or the various cost items that are in the golden triangle , because with a little effort a systematic and well-planned will be found or obtained great benefits . Grouping items cost using ABC classification analysis is one of the efforts to investigate to find the golden triangle , which means an item or activity of the class A is always in the golden triangle area .
#Note : ABC classification is a classification of a group of items ( or activity ) in descending order based on the cost of the use of the item ( or activity ) per time period ( price per unit item multiplied by the volume of items over a certain period ) or the total cost.