Video transcript: Optimising the cost base

Transcript

Alistair Kett: When we talk about optimising the cost base, it’s not just about saving money. It's about unlocking a new way of working.

Nancy Park: Clients really appreciate us working with them to help them identify where they could make improvements.

Matt Curry: If cost savings can be identified within the business to fund broader transformation programmes, that is hugely powerful.

What cost optimisation really means is helping clients understand what is the good cost in their business, that is really driving value, driving growth, and what is the bad cost that is actually holding them back?

Nancy: Common challenges at the moment are rising workforce costs, rising energy costs, rising technology costs, or the need to transform their business into something that is fit for the future.

Alistair: I think reframing cost optimisation is something that you see through good leadership. When they start talking about their strategy, their vision, their ambitions.

Matt: We work with lots of clients to create funding through cost savings for much broader, enterprise-wide transformation.

Nancy: There's often a perception that cost optimisation is short term. It's just about simple cost reduction, but actually it needs to be sustainable.

Alistair: There's a huge range of categories that we can help organisations find money through. At the one end, there's a straightforward analysis of where are you spending your money with suppliers, and we can help renegotiate that. And then at the other end, you have productivity gains that come from looking at how people are organised and how they work.

Matt: A typical programme would yield 10 to 20% savings in the addressable cost base, and we help clients from identification all the way through to implementation.

Nancy: One example of a client I've worked with is a 1.7 billion turnover organisation. They came to us, needing to reduce their costs by a challenging £80 million. The client asked for help to identify where those cost savings opportunities could be found, but also the bigger challenge to implement these savings within that same financial year.

Matt: A piece of work I'm really proud of is working with a UK based hotel chain who faced a barrage of cost pressures, and we helped them end-to-end, identify the good and the bad costs in their business. And ultimately, the overall profitability of that business has improved by 10 to 12%, off the back of our work.

Alistair: You need people that understand the spend cycle, and the contract cycle. You need people that understand the industry and what should be spent and what could be spent.

Matt: We have deep, deep cost out practitioners married up with situational sector expertise.

Alistair: And above all of that, you need embedded technology awareness.

Nancy: We use a number of technology tools and data tools to help us rapidly analyse huge amounts of data.

Matt: We're in this with our clients. We're helping them realise cost savings and the remuneration of us as a firm is directly attributed to the value that's delivered to the business.

Alistair: One thing that you can really look back on when you deliver a cost engagement of this nature, is that you have delivered a very tangible change to a client. It's unambiguous.