Posted under Sales
from 55 days ago

When some people talk about cost savings, they are really talking about price reductions. To them, the easiest and fastest way to see an improvement on their Profit & Loss statement is to reduce the actual spending in a category by extracting a price concession. That is, in fact, one way to reduce costs. It is also the most direct way to reduce costs.

The direct way to reduce costs is not very often the best choice when what you cut costs of things that are strategic, and where reducing costs actually takes money out of the outcomes you are trying to improve.

Maybe people are using too many Post-it Notes. Maybe they waste paper. Maybe they are wasting money on things that are unnecessary to the results you are trying to produce. By all means, cut away. But what about spending on things that are strategic, that produce real value ...


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