A Guide to Strategic Cost Cutting, Restructuring and Renewal

Image result for fit for growth Vinay Couto, John Plansky & Deniz CaglarVery few organizations manage their expenses for sustainable success. And when the time inevitably comes to cut their costs, many companies cut in a way that makes them weaker, not stronger.

The experienced consultants with PwC’s Strategy& team reveal the hidden problems of conventional cost management –– and how your company can do better. Drawing on decades of research, observation and experience helping clients, these experts have developed a unique approach to help CEOs and senior executives cut costs constructively.

The Fit for Growth concept redirects an organization’s resources and investments toward its few differentiating capabilities –– the strengths that set it apart from competitors. When a company manages costs this way, it becomes fit for growth. Its cost structure, organization and culture are aligned with its strategy.

Total business transformation requires total buy-in, and it entails a series of decisions that must not be made lightly. Fit for Growth offers a definitive game plan to cut costs and grow stronger.

IN THIS SUMMARY, YOU WILL LEARN:
• The three essential actions for becoming Fit to Grow.
• Why growth requires cuts and how to achieve both.
• Smart levers to restructure costs.
• Strategies to help leaders, managers and employees embrace large-scale organizational transformation.

Review: The Founder’s Mentality By Chris Zook and James Allen

Image result for The Founder’s Mentality By Chris Zook and James AllenNew companies are notoriously fragile. Yet, as any company grows, moving past its tumultuous beginnings, it runs into three crises, write veteran Bain consultants Chris Zook and James Allen in their book, The Founder’s Mentality. The first crisis is overload: the company fails to scale its business successfully, succumbing instead to internal dysfunction. The second crisis is stall-out: bureaucracy and organizational complexity sap the energy and agility of the company’s younger days. The third predictable crisis is free fall: saddled with an obsolete business model, the company watches its market share dissipate.

According to the authors’ research, the reason for companies inevitably facing (and often being defeated) by these crises can be traced to the loss of what they call “the founder’s mentality.”

The founder’s mentality consists of three defining traits.

The first is, according to the authors, “the insurgent mission” — the belief that the company is not simply selling products but is at “war” with an industry stuck in the past or underserving customers.

The second defining trait of the founder’s mentality is “the front-line obsession,” which is more than an intense focus on customers and the front-line employees who serve them. Founders tend to obsess about every detail in the customer-company interface.

Finally, the third defining trait is “the owner’s mindset.” When people work for a small company fighting for its survival, they see themselves as owners of the company. They are completely invested in its success.

These founder’s mentality traits give a company its edge and its energy. But over time, as the company grows and becomes more hierarchical and more entrenched, as executives are further and further removed from the front lines, and as a dedicated bunch of committed “owners” becomes a large mass of employees, this edge and energy dissipate.

In order to overcome the inevitable crises that companies will face in their history, they must keep or restore the founder’s mentality.

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