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    Cost Optimization Offering

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    deepakkkeni
    1) The document discusses achieving cost efficiency through an outcome based spending approach which can reduce total cost of ownership by 10-15%. It outlines challenges with existing costing practices and the impacts of a disintegrated view of spending. 2) The approach categorizes spending optimization opportunities into clear wins through immediate savings, waste elimination through process improvements, cost variability through outsourcing and variable models, value added investments, and sweating existing assets. 3) Case studies demonstrate potential 10-20% savings on total spend and examples of engagements include redefining metrics and customer experience for various organizations.

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    Cost Optimization Offering

    Uploaded by

    deepakkkeni
    107 views6 pages
    1) The document discusses achieving cost efficiency through an outcome based spending approach which can reduce total cost of ownership by 10-15%. It outlines challenges with existing costing practices and the impacts of a disintegrated view of spending. 2) The approach categorizes spending optimization opportunities into clear wins through immediate savings, waste elimination through process improvements, cost variability through outsourcing and variable models, value added investments, and sweating existing assets. 3) Case studies demonstrate potential 10-20% savings on total spend and examples of engagements include redefining metrics and customer experience for various organizations.

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    1) The document discusses achieving cost efficiency through an outcome based spending approach which can reduce total cost of ownership by 10-15%. It outlines challenges with existing costing practices and the impacts of a disintegrated view of spending. 2) The approach categorizes spending optimization opportunities into clear wins through immediate savings, waste elimination through process improvements, cost variability through outsourcing and variable models, value added investments, and sweating existing assets. 3) Case studies demonstrate potential 10-20% savings on total spend and examples of engagements include redefining metrics and customer experience for various organizations.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    107 views6 pages

    Cost Optimization Offering

    Uploaded by

    deepakkkeni
    1) The document discusses achieving cost efficiency through an outcome based spending approach which can reduce total cost of ownership by 10-15%. It outlines challenges with existing costing practices and the impacts of a disintegrated view of spending. 2) The approach categorizes spending optimization opportunities into clear wins through immediate savings, waste elimination through process improvements, cost variability through outsourcing and variable models, value added investments, and sweating existing assets. 3) Case studies demonstrate potential 10-20% savings on total spend and examples of engagements include redefining metrics and customer experience for various organizations.

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    Aegis Advisory and Consulting

    Outcome based Spending - An integrated approach to cost optimization


    - Reducing TCO by 10-15%

    Private & Confidential


    1

    Achieving cost efficiency has become an imperative now in the face of competition & reducing profits.
    Challenges of Existing Cost incurring trends in organizations
    Higher proportion of Fixed costs and low variable spends Processed looked at in isolation with 1 process having multiple owners at each hand-off but no overall process owner Legacy costing practices / Absence of right costing methodology Hidden costs are unknown Ineffective policy adherence to control spend Non-existence of right tracking mechanism Roll-back of already incurred investments difficult Increasing costs due to frequent expediting / expansion/ overrun High cost of poor quality Investments incurred/ decision taken not linked to the business outcome Maverick Spends
    Aegis Limited - Private & Confidential 2

    Impact

    Disintegrated view of spends

    Distorted cost culture

    Margin pressures

    Higher pricing to customers

    Benefit realization chart


    Companies can realize upto 10-20% savings on total spend
    Figures are only potential indicators and will vary for organizations depending upon their spending pattern and cost management structure

    Aegis Limited - Private & Confidential

    We dont call it Cost reduction.. We refer to it as Outcome Based Spending


    Clear Wins: Immediate profit and Loss impact spend categories Optimization on Administration spends like Travel, Printing and Stationary, Postage and Courier, Electricity, etc Negotiations with vendors Strategic Sourcing Waste Elimination: Business process re-engineering, Operations blueprint Redundant business models / sub SBUs Effective Inventory tracking Productivity enhancement of Sales and Operations teams Optimizing transaction cost and usage of pro-active/ reactive communications

    Waste Elimination Cost Variability

    Spend to revenue linkage: Commission/ Salary structure/ Revenue per user Marketing and advertising spends to business Training and other sales facilitation programs measurement Office infrastructure and manpower linked to branch P/L

    Clear Wins

    Spend to revenue linkage

    Outcome Based Spending (OBS)


    Value Added Investment

    Sweating of Assets

    Cost Variability: Outsourcing/ off-shoring/ Shared Services Building variable cost model for fixed costs Manpower Modeling / Transaction based costing Budget tracking based on relation to revenue Estimation of Cost incurred to serve customers

    Value added investments: Hot-desking to reduce capital cost and other incidental costs Virtualization and Cloud computing Optimized Self Service capability enhancement
    Aegis Limited - Private & Confidential

    Sweating of Assets: Building integrated systems for all asset utilization tracking Deriving full value of the assets available Assess buffer capacity and optimizing opportunities

    We see resonance !
    Because we have developed insights and are outcome partners
    Type Period Engagements 4.5 months

    Large HC Provider USA


    Expanding customer base
    Re-defining CX Re-defining metrics, providing visibility Align organization for accreditation

    Leading Mfg. Co.


    Cost Containment & Ops Excellence Performance Management & Shared Services for SM Cascade of metrics and Exception reporting

    CX Strategy
    Cost Optimization Revenue Enhancement Tech Transformation GTM Strategy Social/ Digital Media Brand Management KPI Management Others Grand Total
    CX Continuum Enriching CX- Consulting Enhancing CX- Analytics Enabling CX - PPT Extending CX- Shared Serv Managing CX - BPO

    12
    7 5 4 3 2 2 2 3 40

    Large Mobile Retailer


    Enable Revenue Growth Driving Higher Conversions for existing footfalls delivering superior Customer Experience Redefining CX Strategy

    Large Truck Mfg. Co.


    Sustain Growth Trajectory Re-defining KPIs for all revenue streams Creating Line of Sight across levels, processes & functions

    Large Bank in UK selling insurance


    Optimizing mis-selling refund Define the strategy for managing PPI complaints and ensuring closures in reduced TAT

    Large Private Bank


    Increase Relationship Value Outside-In assessment of CX across various channels Define context, cross channel transition patterns & CX effectiveness
    5

    Thank You!

    Aegis Limited - Private & Confidential


    6

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