Third Generation Cost Cutting

In today’s world, we consider traditional cutbacks, as well as restructuring to achieve such cutbacks to be part of “business as usual”. This means that when corporate management cannot handle this type of work on its own, it should be replaced rather than bring in consultants.

However, often a company discovers that even after cutting back as much as it could, it still faces the following situation:

  • The spending cuts did not go far enough.
  • A mounting fear of having “thrown the baby out with the bathwater”.

Under such circumstances, it can be a good idea to bring in outside forces to, on the one hand, see if there is more that can be cut back and on the other, to determine if the cutbacks have been too severe in other areas.

We call this process “Third Generation Cost Cutting” (3GCC). It is more creative and imaginative work, in which we draw on the experiences of other industries as well.
In some major projects, this process helped us find additional, and often, substantial potential and cost savings; however, we also reinstated some cutbacks that we judged to be wrong, as they could have a negative effect on the organisation’s overall efficiency.

If you would like a more detailed description of what “Third Generation Cost Cutting” could mean for you, click here.