Most organisations accept without question the principle that costs should be kept as low as possible provided they don't put key corporate objectives at risk. In practice, organisations often face strong pressure to increase resources to meet objectives such as better customer service and product quality. Reducing costs is often problematic because it not clear exactly what is being done, and the value of this work to the organisation, in the areas you seek savings. This course examines six ways of overcoming these problems: improving the ability of spending areas to contribute to key corporate objectives and customer needs, while reducing their costs significantly.
On completion of this course, participants will have a greater understanding of:
- Six techniques for reducing costs in an organisation
- Assessing the applicability of each technique to their circumstances
- Some resources that are important in terms of achieving strategic goals, and should be carefully preserved and enhanced, and some are less important and might therefore be better candidates for cost reduction
- Reassessing the management structure of the organisation in a way that provides for the right number and level of management posts to give effective management at lowest management cost
- How activity analysis can be used to: bring clarity about what people do in the organisation; identify cost reduction opportunities that would otherwise remain hidden; stimulate cost reduction ideas that would otherwise be missed
- The importance of purchasing effectively as a potential cost reduction opportunity, and of benchmarking as a means of identifying world class performers who can be emulated
- The role that reducing both fixed assets and working capital can play in reducing the costs of the organisation.
Authored by: David Baines
David is a director of Freeman Baines Consulting. He holds an MBA from the London Business School and has been a management consultant for 23 years, working extensively in both the public and private sectors. His experience includes forecasting and budgeting, overhead cost reduction, activity-based costing, organisational restructuring, performance measurement and business process re-engineering.
CPD Points: 1.5
CPD Duration (hours): 1.5
Access: 12 months from purchase date