Profit is a business owners reward. All key stakeholders have a vested interest in ROI
- Owners through increased cashflow, profit & resale value
- Clients through perception of ‘value’ & positive customer experience
- Staff through skills, learning, experience & references
- Suppliers through greater confidence in future demand & payment
Highest ROI comes from a Cost Management Specialists investment when:
- customers question price/service/quality/customer experience
- constraints to throughput leaves customers waiting
- staff confidence in change management is framed by past failures
- pricing & costing needs review against competitive benchmarks
- products/services need to be understood by volume & margin
- customer profitability is unclear & needs analysis
- digital opportunity is not understood & risks are not managed
- IT focus is continuity not strategic or cross functional
- total expenditure is $15m+/annum
- staff expenditure is a 60%+ of total expenditure
As a learning organisation, Cost Management Specialists transitioned from ‘manufacturers of profit’ to focus on Value, ROI & Profit pathways by learning:
- Cost management is strategic. Any fool can reduce cost creating a ‘solution’ worse than the initial presenting problem.
- Staff engagement is vital to sustainable cost management and profit improvement in an increasingly competitive economy.
- Price/unit is only part of the cost management equation. Demand, quantity, cashflow, inventory, waste/error/variance, market testing & logistics are equally significant considerations.
- Workforce Planning & Labour Management must be under ongoing review (Insource/Outsource/OffShore/Casualisation) with automation, robotics & artificial intelligence options.
- Labour as a % of total expenditure is forecast to be less in a digital business model than in a historical business model.
- Business intelligence can guide productivity improvements.
- Internationally proven business improvement techniques take a value stream approach e.g. systems thinking, constraints, lean/six sigma, process excellence, digital transformation
- Digital transformation can deliver a better experience to a broader market anytime, anywhere often at greater margin using automated business intelligence facilitating consumers choice.
- The Internet of Things drives increased competition from international suppliers in local markets using economies of scale by removing physical & non physical constraints
Our Leveraging ROI projects facilitate stakeholder engagement & cross-functional collaboration, embrace diverse views & identify sustainable cost management solutions.
Leveraging ROI projects make ‘the whole’ greater than ‘the sum of the parts’ whether ‘whole of enterprise’ or a value stream process.
Leveraging ROI Projects Teams make strategy operational through pursuit of specific, measurable & timely outcomes. Team members ‘buy in’ to a performance improvement culture by developing their continuous improvement mindset & capability.
Click on the process map to clarify the ongoing benefits of a Leveraging ROI Project – Value, ROI, Profit & Sustainability.
Contact Cost Management Specialist on +61 411 522 521 or firstname.lastname@example.org.