Strategic Cost Reduction:
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Strategic Cost Reduction
Eliminating unnecessary costs
The more successful your business, the more it grows in size. The flip side of growth initiatives is that they place a burden on the organization and add significant complexity to manage. If left unchecked, ultimately growth adds considerable cost to the business.
Strategic cost reduction takes a broad and deep approach that gets to the heart of the firm’s cost structure. The fundamental realization is that not every dollar of cost is equal. Some costs drive customer value creation and profits directly; others do not.
The goal is to know which costs, activities, and efforts yield the optimal return to the firm and its stakeholders and which don’t – and take strategic action.
What You Will Learn
- How to form a strategic view of the cost structure
- The steps involved in spotting unnecessary costs hidden from view
- Where to look for substantial cost savings
- The factors involved in identifying the right cost reduction options
- How to choose among competing strategic actions