Cost Reduction
Cost Reduction Myths
Many cost reduction programs damage organizations because leaders rely on common myths instead of a disciplined change management framework.
Common Myths That Can Derail Cost Reduction
Theory ZYX helps organizations avoid these pitfalls by treating cost reduction as a full organizational change initiative, not simply an expense-cutting exercise.
Myth
More technology always cuts costs.
Myth
Information Technology is the best department to lead the cost cutting effort.
Myth
The main reason to cut costs is to meet quarterly earnings estimates.
Myth
The CEO or General Manager needs to bring in consultants.
Myth
It is better to cut costs slowly.
Myth
The fair way to downsize is to lay off people based on seniority.
Myth
Hold off reducing costs because business will come back.
Myth
Attempting to motivate employees while cutting costs is futile.
Myth
Short-term cost cutting can be divorced from long-term effects.
Myth
Employees have no reason to cooperate in cost reduction.
Myth
It is impossible to get collaboration between departments.
Myth
Culture has nothing to do with cost reduction.
Myth
Cost cutting does not require change management.
Myth
Cost cutting demotivates employees.
Myth
Cost cutting always adversely affects quality and service.
Avoid The Pitfalls Of Cost Reduction
To avoid common cost reduction pitfalls, apply Theory ZYX. To succeed spectacularly at cost reduction, contact Change Management Center.
Contact UsRelated Cost Reduction Resources
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