The entire world is facing the same crisis right now. As of the morning of April 2nd, there are close to 1MM Coronavirus cases worldwide, of which 75% are active cases. For almost all countries, the case growth is still growing exponentially on a day-to-day basis.
With entire nations under lock-down, many industries and businesses have been grinded to a halt. Most businesses are finding it difficult to stay afloat in these never-before-seen times of extreme difficulty.
Those organizations that will survive are ones that can effectively manage their costs, capital, and cash flow. Below, we have highlighted several best practices from the Flevy Marketplace that discuss these areas:
- Cost Reduction Opportunities
Cost Reduction will be at the top of the agenda for every organization. So, when it comes to Cost Reduction, where are the areas with we this greatest potential in savings, while minimizing negative impact to our operations and our employees? This framework identifies up to 45 Cost Reduction opportunities across the Porter Value Chain, categorized into the areas of Enterprise-wide Opportunities, Asset Management Opportunities, and Function Specific Opportunities. For each Cost Reduction initiative, specific examples are provided, along with projected potential savings.
- Strategic Cost Reduction
Want to understand the entire Cost Reduction process? This presentation is a training document about Strategic Cost Reduction (SCR) used by a major consulting firm in a Cost Reduction engagement. This client-facing presentation introduces a 4-phase approach to SCR, from planning to implementation.
- Cash Flow Management
Truer words have never been spoken, cash is king. Cash flow is the flow of money in and out of the business. Managing your cash flow is vital for business survival and growth, even if you have existing cost savings programs in your organization. The impact of disasters such as COVID-19 has driven the global economy into a recession and many businesses are only just trying to survive. Before taking drastic actions such as cutting salaries and staff, now may be a good time to review your current cash flow performance to stem unnecessary cash outflow and eliminate the cost of waste in your processes.
- Financial Resilience
This framework on Financial Resilience provides the steps that organizations can take to optimize Cash Flow Management during a crisis and integrate the process for managing financial resilience into the organization’s overall strategy. It also presents an operational review current state assessment in order to fully gauge where cash is being utilized and a monthly cash flow template to ensure effective Cash Flow Management during a crisis.
- Capital Optimization Operating Playbook
Amid this crisis, there is mounting pressure to reduce costs, including stay-in-business (SIB) capital spend. This presentation provides a framework for developing a Capital Scrubbing and Optimization Strategy. This framework, developed in accordance with the methodology of a top tier consulting firm in the SIB execution environment, will assist in assessing to determine if Capital Optimization potential exists.
- Activity-Based Cost Management (ABC/M)
Do we know our true costs? ABC is a framework that brings truly accurate fact-based measures and visibility to costs. The resulting cost visibility informs manager about what things costs and more importantly why things have costs. ABC also helps reduce costs and improve productivity by reporting per-unit costs that can be used as benchmarks and to monitors cost trends. ABC can also associate costs with value, quality, and waste, with their strategic importance, with their level of performance, and other “attributes” of work. All of this cost and trait data are further translated into which products, channels, customers or internal company-sustaining workforce staff cause and consume all of the resources… and in exactly what proportions.
For additional frameworks and templates relevant to the COVID–19 crisis, take a look here: Coronavirus Business Resources.
Do You Need Coronavirus Trend Data?
Have a look at our free online tool, Coronavirus Dashboard. This dashboard presents case trend data and news for the Coronavirus (COVID-19) spread at the regional, country, and territory levels. We track numerous metrics that other websites do not. All data can be easily downloaded for you to perform your own scenario analyses.