The Modern Rules of Rapid Cost Reduction Consulting

Cost cutting has an immediate impact on sales and revenue. In modern work environment, there is a strategic need to cut cost, instead of adopting a slash and burn approach.  Simple efforts like renegotiating the rent, cutting the shipping costs by sending packages in bulk, reduce the entertainment expenses of clients can drastically help in reducing overhead.

However, when cutting costs businesses have to make sure that they have the right people in place performing the job, they are using technology to its full potential, they are leveraging on all the opportunities to automate and streamline manual procedures and processes.

Companies are taking help of strategy consultants to understand what is important and where the resources can be aligned. Here are some golden rules used by organisations for rapid cost reduction.

Rules to Cut Cost in the Most Productive Way

·    The travel expenses are being reduced as the meetings are conducted via video-conference. Nearly 90% of the users find video conferencing extremely helpful in staying connected to their colleagues, according to the statistics published by Lifesize.  Video conferencing helps in enhancing work life balance and boost productivity.

·        Companies are including employees in their cost cutting initiatives. Working internally, they can be the best person to tell where the company can spend the money and resources judiciously. In fact, the employees are rewarded for their cost cutting initiative. It is surprising to see the number of ideas they receive.

·        Organisations are aiming at a more cost effective collaboration with the suppliers and vendors.  Even if the company is having an age long relationship with a vendor, they are not hesitating to choose another vendor who is ready to offer the lowest bid.

·        Businesses are examining their advertising and marketing efforts to see if they are getting a competitive advantage over competition.  If the programs are good, there is no harm in increasing the advertising budget. If not, they are dropping it immediately.

Interim Management For Savings

For immediate cost cutting, businesses opt for layoffs or downsizing the organization to significantly reduce the expenses. However, the permanent termination or even temporary suspension of employees can have long-term effects that can be harder to compensate. A strategic approach is required.

Businesses are reducing the working hours of the employees. They are not hiring new employees. However, for mission critical projects there is a need of having the most intelligent and result oriented minds in place.  

Hiring interim executives help in taking advantage of opportunities at a lesser cost. The interim workers are hired on a project basis, usually for weeks for months. They are paid for their working days. Moreover, companies don’t need to pay the employee benefits which they were liable for permanent employees.

Be a smart business owner and hire the best interim executives who are known for their professionalism and high skills.

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