-: Cost management is especially important
for CEOs in the current environment.
Our survey of more than 700 C-suite executives confirms
that cost-consciousness is top of mind.
We're facing historic levels of change
across all industries and an uncertain macro economy,
featuring many challenges from inflation,
high interest rates, a changing work environment
through an emerging cost of living crisis,
and the emergence of AI in every aspect of our lives.
We can't pass cost on to consumers,
we have to look at our P&L.
Our research shows
that leaders can create competitive advantage
and fuel long-term success, even during downturns
by reinvesting resources freed up from cost savings
into growth actions such as innovation, AI,
upskilling your workforce,
or deploying and developing new products.
But all of those require investment.
To find that funding, CEOs need to take a hard look
at where they invest scarce resources.
Many companies have not closely reviewed
their cost base holistically in many years.
It's not simply cost out,
but instead, investing in efficiency and effectiveness.
And we know it's not a one-size-fits-all approach.
Some companies will need to trim old products
and services while others will require a more nuanced look
at organizational effectiveness.
For example, we helped a US-based airline achieve
an unexpected cost reduction of 15 to 20%
by redesigning their organization.
And at the same time, we improved accountability,
customer service, and the overall talent level.
That solution probably wouldn't work if you were a retailer,
which is why it is important to look
at each company holistically when evaluating next steps
in this economy.
Ultimately, in order to ensure the health and growth
of their companies, leaders need
to thoughtfully manage costs now
to sustain future growth and investments.