For most companies, cost cutting in a down economy means across-the-board slashing that "spreads the pain" of budget reductions across many departments. While that may sound like the best approach for getting critical results fast and for limiting political infighting, it is a mistake — one that will leave your company weaker, not just smaller.
Instead, companies that need to reduce costs should treat the challenge as an opportunity to identify and reinforce their key capabilities, while divesting from those activities that do not truly reflect the business’s strengths or long-term goals. This more strategic approach will make your company more resilient as tough times continue and more robust as recovery begins.
"Most companies cut costs randomly and without regard to strategy. In this short book you will find not only clear thinking about strategic capabilities, but also much-needed advice about how to cut costs without losing the capabilities that make your firm distinctive in its industry."
In the e-book Cut Costs and Grow Stronger, Shumeet Banerji, Paul Leinwand and Cesare Mainardi provide executives with the tools they need to rapidly implement capabilities-driven cost reduction. First they demonstrate how to identify and clearly articulate your company’s key capabilities–not just core competencies or skill sets, but those very few strengths that, in combination, define how your organization competes. You can then use this information to create your company’s unique blueprint for effective and efficient cost reduction. The authors’ detailed, step-by-step framework walks you through the process, which can be completed in as little as two or three months — it’s something that you can do now.
Click here for more information about Fit for Growth, our unique approach for cutting costs and growing stronger.
"Cut Costs and Grow Stronger explores a novel way to think about costs and details a method of becoming cost effective in good times and bad. Approaching the subject of costs on a strategic and capability-driven basis by segregating discretionary and nondiscretionary costs enhances focus and as a consequence, produces a far more valuable outcome. A particularly useful read given the times!"
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