This PPT slide, part of the 97-slide Strategic Cost Reduction Training PowerPoint presentation, presents a comparative analysis of 2 distinct approaches to cost management: Incremental and Transformational. It begins with a shared underlying philosophy centered on responding to cost pressures,, but diverges significantly in strategy and execution.
The Incremental Approach is characterized by a limited scope, often confined to specific functions or processes. This can lead to reinforcing organizational silos, where departments operate independently, potentially missing broader opportunities for efficiency. Executive leadership is not a prerequisite, allowing initiatives to be driven at the business unit level. However, this can result in a lack of alignment with overarching corporate goals. The design and execution of projects under this approach tend to focus on project-based metrics, which may hinder effective coordination across initiatives. Change leadership faces challenges, as cultural shifts are often stymied by insufficient mandates, leading to limited change and savings typically under 10%.
In contrast, the Transformational Approach advocates for a comprehensive, organization-wide strategy. It requires active engagement from corporate executives, ensuring that cost management objectives are clearly communicated and integrated into the company's philosophy. This approach employs a program or portfolio methodology for project definition and tracking, fostering better alignment and accountability. The intensity of this method supports a culture of continuous improvement, aiming for significant savings ranging from 20% to 30%.
The insights from this slide suggest that organizations seeking substantial cost reductions should consider a transformational strategy, as it not only addresses immediate pressures, but also builds a sustainable capability for long-term financial health.
This slide is part of the Strategic Cost Reduction Training PowerPoint presentation.
EXPLORE MORE SLIDES FROM THIS PRESENTATION
EXPLORE MORE PRESENTATIONS ON
Cost Reduction Assessment Continuous Improvement Cost Management Cost Reduction Organizational Silos Leadership
Flevy is the world's largest knowledge base of best practices.
Leverage the Experience of Experts.
Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.
Download Immediately and Use.
Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.
Save Time, Effort, and Money.
Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.
