Community Forum – How do you build and prove the value case for cost savings without compromising quality or sustainability?

A: How do you build and prove the value case for cost savings without compromising quality or sustainability?

Please find below the responses to this week’s IRI Community Forum Survey. Thank you to those who took the time to add their input! 

We are looking to improve our approach to cost savings initiatives — from building strong value cases to proving impact and overcoming barriers. Your insights will help us all benchmark and improve how we drive meaningful results.

Responses are below.

Community Responses

Other:

• Net Margin Increase!

Other:

• Financial modeling with verification of results via lookbacks

Other:

• Net present value added and per dollar of investment

It depends – explain:

• Never characterize as cost savings, use value via increased revenue, margin, cost, etc!  Cost savings is myopic and too easy, you are in business to create more value which requires many more dimensions than cost savings. 
• Typical cost savings initiatives around a product are 18 months, capital expenses leading to longer-term savings are given more time to complete (2-3 years in some cases)
• Our projects often take many years, it’s not too long if it meets product launch need dates

Other:

• Total clarity across the organization as to the goal (value increase)
• People want to realize the cost savings quickly, which compresses timelines.