Preface ix
PART I Introduction and Fit for Growth Overview 1
Chapter 1 Do You Need to Cut to Grow? 3
- Circuit City: The Ostrich Approach 6
- IKEA: Elevating Cost Optimization to an Art Form 9
- The Fit for Growth Index 12
Chapter 2 Becoming Fit for Growth: The Restructuring and Renewal Journey 17
- Focus on Differentiating Capabilities 19
- Align the Cost Structure 21
- Reorganize for Growth 24
- Enable Change and Cultural Evolution 28
- Continuous Cost-Fitness Renewal 29
Chapter 3 The Leader’s Role: Aligning Costs with Strategy 31
- How Do You Know When It’s Time? 32
- The Three Core Questions Leaders Ask 34
- What Makes the Fit for Growth Approach Different 43
PART II How to Cut Costs and Grow Stronger: A Manager’s Guide 45
Chapter 4 Levers of Cost Reduction: What, Where, and How 47
- Setting the Objective 48
- Identifying Differentiating Capabilities 50
- Selecting the Cost-Reduction Levers 52
- “What” Do We Do? Business Portfolio and Capability Choices 52
- “Where” Do We Do It? Organization and Location 53
- “How” and “How Well” Do We Do It? Operational Excellence 55
Chapter 5 Portfolio Rationalization: Decide What Business You Should Be In 57
- What Is Portfolio Rationalization? 58
- When to Use Portfolio Rationalization 62
- How to Rationalize the Portfolio 64
Chapter 6 Zero-Basing: Justify What to Keep, Not What to Kill 70
- What Is Zero-Basing? 70
- A Versatile, Holistic Cost Lever 73
- When Should You Zero-Base Your Capabilities? 76
- How to Zero-Base Your Capabilities 76
Chapter 7 Aligning the Operating Model: Redefine Where Critical Work Gets Done 85
- Operating Model Elements and Archetypes 86
- When to Redesign Your Operating Model 92
- How to Redesign Your Operating Model 93
Chapter 8 Outsourcing: Let External Providers Generate Value for You 103
- What Is Outsourcing? 103
- When to Outsource 107
- The Outsourcing Process: How It Works 108
Chapter 9 Footprint Optimization: Rethink Your Operations and Overhead Locations 119
- What Is Footprint Optimization? 119
- When to Use Footprint Optimization 123
- Footprint Optimization: How It Works 126
Chapter 10 Process Excellence: Simplify Work and Minimize Bureaucracy 133
- What Is Process Excellence? 134
- When to Use Process Excellence 139
- A Guide to Process Excellence 140
- Aligning Process Excellence with Other Cost Levers 146
Chapter 11 Spans and Layers: Flatten and Empower the Organization 149
- What Is a Spans and Layers Restructuring? 149
- When to Restructure Spans and Layers 154
- How to Restructure Spans and Layers: Five Steps to a Leaner Organization 155
Chapter 12 Strategic Supply Management: Extract More Value from Your Purchases 163
- What Is Strategic Supply Management? 163
- When Should a Company Use Strategic Supply Management? 167
- Making It Happen: A Guide to Strategic Supply Management 169
Chapter 13 Digitization: Make Technology a Game Changer 177
- What Is Digitization? 177
- When to Use Digitization 179
- How to Digitize 182
PART III Coping with Cost Restructuring: How to Manage and Sustain the Change 189
Chapter 14 Running a Cost Transformation: Mobilizing, Scaling, and Sustaining 191
- Phase 1: Diagnostic and Case for Change 193
- Phase 2: Detailed Design 198
- Phase 3: Execution 203
Chapter 15 Morale, Emotions, and Expectations: Leading during a Restructuring 208
- Uncertainty and Anxiety 209
- Phase 1: Opportunity, but for Whom? 211
- Phase 2: Anxiety Surfaces 214
- Phase 3: Turmoil, but also Glimmers of Something Better 216
Chapter 16 The Human Element: Getting People Ready, Willing, and Able to Change 224
- Elements of a Culture-Led Change Management Program 226
- Phase 1: Diagnostic and Case for Change 230
- Phase 2: Detailed Design 233
- Phase 3: Execution 242
Chapter 17 Staying Fit for Growth 246
- Strategic Levers: Translating Strategy into Performance 247
- Operational Levers: Executing against the Plan 251
- Organizational Levers: Assign Accountability and Reward Cost Consciousness 253
- Cultural Levers: Unleashing the Individual 255
- Sense and Sustainability: Getting from Here to There 258
Notes 259
Acknowledgments 261
About the Authors 265
Index 267
