Cost Reduction Review
Ranks by cost removed per unit of risk introduced, since the cheapest cuts are frequently the most expensive later.
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Running it, start to finish
- Sort every cost into the four categories.
- Take the waste before anything else.
- Say plainly if the target requires load-bearing cuts.
What you get back
The output this produces, every time.
- Separates waste from discretionary, investment and load-bearing costs.
- Names the deferred-consequence cuts explicitly, so they are decisions rather than oversights.
- States plainly when the target cannot be met without structural damage.
Getting better results
Where this usually goes wrong, and how to avoid it.
- Do the unglamorous waste hunt first. Unused subscriptions and reports nobody reads are free money, and they are skipped because finding them is dull work.
- Weight reversibility heavily. Losing experienced people costs multiples of the saving to rebuild, and it is the least reversible cut available.
- Check the cut removes cost rather than moving it. Work displaced to another team looks like a saving in one budget and is not one for the business.
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Written for The AI University. Every prompt in this library is original work — authored, tested and revised here, not collected from elsewhere. 365 of them, free with an account.