Is your cost structure still fully aligned with your vision?
The global lockdowns are having a significant – if not devastating – effect on most businesses. Many companies will survive the crisis, but they’ll emerge a lot smaller and in a changed environment. Reviewing your vision has now become a necessity. Your current cost structure is most certainly no longer optimal. Now is the time to ensure that every euro spent contributes 100 per cent towards achieving your ambition.
Aligning your vision and cost structure – 4 questions
There are two basic ways to approach cost cutting: targeted and zero-based. As most companies are facing a major, and quite disruptive, change, a comprehensive approach is needed. In our experience, Zero-based Alignment provides the better way to radically redesign the cost structure of a business.
The first step is to work out an appealing vision for your business in the “new normal” and set a challenging cost target. Next, current activities and cost structures need to be mapped and understood in detail. To understand how best to address this, we work with four main questions (see figure below).
The answers to these questions become the input for an iterative process that starts with a redesign of end-to-end business processes. Next, the organisation structure is designed to fit these new processes. The design always starts with a blank sheet of paper. By comparing the existing state with the ideal state, many opportunities are identified for both savings and new growth opportunities.
The Zero-based Alignment workflow
The overall process that Zero-based Alignment follows is shown below.
A new and stimulating future
Zero-based Alignment generates powerful effects: a fresh and energising vision that reflects changed market conditions, significant cost reductions, improved yield on every euro invested, new growth opportunities, and a new and stimulating future for your business. And that’s exactly what every company needs right now?