INDUSTRYVOICES
H
ow can
companies
balance short-term
cost cutting with
the need to be
ready when the
economy recovers?
The first reaction most companies have made in the face of crisis is to bring out the knife to cut travel, cut
employees, cut training, cut marketing and any other non-essential costs. To get an assessment of the efficacy
of such measures, we asked industry professionals on our Linked-In community group their opinion on short term
cost cutting.
Jason Lo Joe Zhou Sharon Elshaug Saikrishna Bendapudi
Strategy & Marketing General Manager Creative Business and IT Vice President, Operations
Director, North Asia HomeFront International Solution Architect,
Honeywell Building Solutions Insightful Solutions
Why not think about What we have seen in Don’t forget to examine I believe cost cutting
this more positively? -- China is not an issue the process from your has more to do with in-
cutting costs will only of burning more or less customer’s viewpoint efficiencies with the sys-
enable you to preserve cash to stay afloat, but - eliminate any non- tem and is a continuous
capital for investment a complete shutdown to value added steps or excercise, neither short
for the future. If you’ve preserve funds and wait processes, and check term nor long term.
got a sound strategy to for a rebound. This is your assumptions at Cost reductions arising
begin with, and the busi- especially true of small the door. For those out of a different busi-
ness economics are and medium suppliers. processes not consid- ness climate should not
likely to recover, then The key is to make ered strategic in nature, be called ‘cost cutting,’
you will need to invest the surviving suppliers consolidate, eliminate It is more appropriate to
in your core business leaner and stronger, and/or streamline those refer to them as a new
sooner or later. securing their competi- processes to maximize cost structure to run a
tive advantage for the savings. new business.
future.
16 MAY/JUNE 2009
www.chainaonline.com
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