What is Strategic Cost Management?
Strategic Cost Management is a method of creating strategies and plans for managing costs efficiently. It involves focusing on optimizing processes, reducing overhead, and increasing revenue through cost-effective strategies. This process helps to improve the overall financial performance of a business.
What's included in this Strategic Cost Management template?
- 3 focus areas
- 6 objectives
- 6 projects
- 6 KPIs
Each focus area has its own objectives, projects, and KPIs to ensure that the strategy is comprehensive and effective.
Who is the Strategic Cost Management template for?
This template is designed to help anyone who needs to create a strategic plan to manage costs. It is an easy-to-follow guide that walks you through defining focus areas, creating objectives, setting measurable targets (KPIs), and implementing related projects for faster results.
1. Define clear examples of your focus areas
Focus areas are the broad topics or areas of your business that you’d like to focus on when creating your cost management strategy. These focus areas should be well-defined and should relate directly to your overall business objectives. Examples of focus areas include optimizing operational efficiency, improving financial performance, and enhancing customer service.
2. Think about the objectives that could fall under that focus area
Objectives are the goals that you’d like to achieve within each focus area. They should be specific and measurable. For instance, if your focus area is optimizing operational efficiency, your objectives might include reducing shipping wait time and increasing delivery accuracy.
3. Set measurable targets (KPIs) to tackle the objective
KPIs (key performance indicators) are the measurable targets that you’ll use to track your progress on each objective. KPIs should be specific and should have a numerical value associated with them. An example of a KPI for the focus area of Optimize Operational Efficiency could be: Decrease Average Shipping Wait Time from 120min to 45min.
4. Implement related projects to achieve the KPIs
Projects (or actions) are the steps you’ll take to achieve the KPIs you’ve set for each objective. For instance, if your objective is to reduce shipping wait time, one of your projects might be to streamline warehouse processes. This will help to reduce the average shipping wait time and achieve your KPI.
5. Utilize Cascade Strategy Execution Platform to see faster results from your strategy
Cascade Strategy Execution Platform is an online tool that helps teams to quickly and easily create and manage strategic plans. With Cascade, you can easily break down your objectives into actionable initiatives, assign responsibilities to team members, and track progress toward your goals. With Cascade, you can see faster results from your strategic cost management strategy.