Sometimes downward pressure on business revenues can bring cost reduction to the forefront as a key issue. Other times cost reduction can be a practise taken to enhance a company growth. reducing cost in certain areas allows for additional spend in others, such as innovation or diversification.
What separates the A and B teams of businesses is how to reduce cost whilst keeping the business moving forward and executing your strategy. Strategy also plays a very key role in helping you identify what activities to keep funding and which to cut as they are not strategically important.
We asked companies what are their current plans around cost reduction.
How do you compare to the above levels of cost reduction activity? Have you started planning but not implemented anything? Are you in the middle of it?
Ultimately, cash remains king. At times of economic turbulence, cash management & cash at bank remains a critical issue. For that reason, we also asked companies how long they had in their runway.
Cost reduction can be stressful. It’s emotive, it can feel like taking a step backwards, and it’s sometimes with the backdrop of survival. Although hard, it’s possible to have a positive outlook on it. It can be a process to stimulate growth, to focus on what is working for the company, and to evolve to a better state.
If you’d like to read up more on strategic cost reduction you can check out the following resources: