Capability Assessment & Sustained Cost Transformation

• With experience from our engagements, our performance improvement consultants understand how to target new sources of profit and design pragmatic, hit improvements. Cost & Capability Assessment is a diagnostic tool that draws on our benchmarking expertise, quick analysis and collaborative approach to identify operations opportunities that can be implemented swiftly to boost the bottom line.
• The Cost & Capability Assessment has the ability to identify and deliver cost reduction and cash improvement opportunities that can be implemented quickly for results within the fiscal year.
• While not intended to replace a full cost evaluation and detailed action plan, our Cost & Capability Assessment can be used as a first step diagnostic tool during early opportunity-identification stages to offer a comparison of company performance against key indicators and best practices. Combined with our expertise and collaborative approach, the assessment offers a means for informing decisions on improvement opportunities.

Our assessment draws on four sources of insight: We benchmark performance in the vast majority of our performance improvement engagements and our approach begins with a clear understanding of what works best when it comes to benchmarking:

• Inputs: Cost and performance indicator benchmarks are understood as one input among several in identifying opportunities.
• Scope: Specific questions to be answered during the benchmarking exercise are defined before kick-off.
• Topical expertise: Topical experts advise teams on the intricacies of the benchmarks and the specific levers for improvement.
• Savings opportunity: The range of the potential ‘size of the prize’ is calculated in concert with functional leaders.
• Implementation: Benchmarks are understood to help functional leaders focus their bottom-up efforts to size the prize and launch initiatives to capture value.

Our benchmarking consultants also use proprietary materials, partnerships and external sources that add context and depth to our process. In some cases, ExpertActions can also act as an unbiased third party to benchmark peer companies in various industries.

• Contact us if you’re interested in learning more about our benchmarking capabilities.
• Our process goes beyond benchmarks and numbers to build a well-founded opinion on performance improvement opportunities.

We work jointly with client teams to assess opportunities across ten levers of performance spanning revenue enhancement, cost improvement, and balance sheet.

The assessment is designed to build agreement as we work together to quickly establish the large areas of opportunity and prioritize those for further analysis or immediate implementation.

Sustained Cost Transformation:

• In the current marketplace, having a low-cost position is a key differentiator between leaders and followers. We help companies in a wide range of industries around the world create disruptive changes in their cost position, be it to help them catch up with the industry’s cost experience curve, protect margins in spite of erosion of average selling prices, or to widen their competitive advantage. These programs use a battery of tools to deliver reduction of a company’s addressable cost base across multiple areas of the value chain.
• Achieving a low-cost position is critical for most businesses both because of the obvious improvement to the bottom line, and for the ability to fund investments and growth initiatives that otherwise would be out of reach. Our clients typically use a portion of the captured savings to invest in marketing, new market entries or simply more competitive pricing.
• While we many times work with companies to help them achieve functional excellence within individual areas of the organization, we unlock the most value by taking a functional approach, and addressing operating problems at the nodes, or the points where business units, functions, geographies, and layers of management intersect and have to make and execute critical decisions. In our experience, this approach creates between three and four times as much value as the traditional approaches to right-sizing and functional excellence

ExpertActions takes a approach to make cost reduction strategies both efficient and effective. The main goal: work with our clients to set up a system to accelerate revenue growth, not hinder it.

• We first help diagnose key opportunities for savings. These typically occur both in functional areas, and in the nodes where different parts of the business intersect. From there, we set the right targets, using external market benchmarks and comprehensive, cross-functional metrics.
• We team with the organization to mobilize it for the upcoming changes, working collaboratively across functions and addressing concerns to get the necessary buy-in. We do it with the organization, not to the organization, simultaneously launching some projects with relatively quick returns to build momentum.
• With management, we design a customized plan for hitting the targets they are setting by applying our world-class toolkit. Cost reductions need to be conducted the organization in order to make them stick and the key is to tailor them to overall strategy; bolstering revenue potential instead of undercutting it.
• The last phase, implementation, is the one with the longest legs. Tracking cost metrics is one piece of it, but hardly the only one. If the employees at the front line don’t begin to think and act differently, the initial cost savings won’t last. To ensure that change becomes deeply embedded in the organization, we often help companies evaluate the degree of disruption each group is likely to experience and set up capabilities to mitigate it.