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How to reset costs and reshape your business for growth
A guide to respond and emerge stronger from the COVID-19 crisis
Fit for Growth
CEOs were already juggling cost challenges before the COVID-19 outbreak. Then the world’s 20 largest economies went on lockdown within an eight-week window. Optimism for a quick recovery has evaporated and one big question looms: How do we prepare for a future that will be forever changed, but is still not fully known?
The actions you take now to protect your business are critical for its future success. But what are those actions? Our Fit for Growth approach offers a clear path to emerging stronger from the COVID-19 crisis by helping you re-assess strategic priorities across the value chain to thrive in the new normal.
While most companies will work to protect the bottom line, cost-cutting will not be enough. The global pandemic has upset past beliefs and models about costs. Companies need to cut in a way that doesn't harm growth or chances of survival. With so much change, it’s crucial to reinvent and rebuild for strength and agility.
Three actions to reset costs and reshape for growth
Strategic priorities, organizational resets, and new ways of operating are all on the table as companies balance cost-cutting with reinvestments for growth. Here are three actions that can help cut the right costs in the right ways and help your business emerge fighting fit from this crisis:
1. Revisit strategic priorities
Focusing on the core capabilities that differentiate your company in the market is a smart way to redirect costs to the right growth drivers.
2. Look for what’s different across the value chain to reset your cost structure
Try to find a combination of “no-regrets moves” (low-risk decisions) and “strategic bets” that are high-reward in the scenario you’re betting on.
3. Bring your people with you into the new way of operating
Isolate and reward the few behaviors that allow your teams to solve problems quickly, then build them into your new way of operating and continue promoting them.
Fit for Growth for the new normal
In the wake of COVID-19, all companies face changing market dynamics and new ways of doing business.
The Fit for Growth approach provides a powerful and complete way to be ready for the new normal and emerge stronger, orchestrating company transformations along five key dimensions.
To orchestrate a successful transformation, you need to take a holistic and differentiated approach across five key areas
Develop a clear-eyed strategy
Take another look at your existing strategy and be clear about your must-haves to win in the future — regardless of any economic scenario.
Double down on your differentiating capabilities
Now’s the time to zero-base your cost structure to clarify where to invest and how to pay for it.
Radically transform your cost structure
Revisit your entire cost structure and establish short, mid- and long-term actions to fundamentally adjust for the future.
Reimagine your operating model
Post-crisis reality will challenge today’s operating model across a number of dimensions. Use technology accelerators to better organize and collaborate, strengthening resilience.
Accelerate your cultural evolution
Actively engage the organization to define the required behaviors to build on cultural strengths and own the actions to shape the future.
“81% of CFOs are currently planning cost-containment measures.”
An accelerated approach to start on the path to fitness in six weeks
The Fit for Growth approach leverages a suite of digital assets, deployed virtually, to enable rapid analysis and actionable insights. It generates first results within six weeks while shaping the future path to emerge stronger.
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