Cost Reduction for Managers & Management Consultants

In the second section, I will show you the main frameworks that will help you with cost reduction. We will have a look at the general framework. I will also show you the adjustments for FMCG and retail. Frameworks are great because they help you see the big picture. They also provide you with guidance on what to do to achieve your goals

Here I will show you the general framework for decreasing the costs in retail

Here I will show you the general framework for increasing the margin in retail

Imagine that you are working for a cosmetics producers. And you have to increase his profitability   

In this lecture we will solve the previously introduced case study

In this lecture we will solve the previously introduced case study

Imagine that you are working for a fashion discounter that operates a retail chain in Easter Europe . In this lecture we will find ways to increase the profitability

In this lecture we will solve the previously introduced case study

In this lecture we will solve the previously introduced case study

In this section, I will show you how to identify the so-called quick wins – in other words, big savings that you can easily achieve, implement. We will start with 2 general frameworks (80/20 and low hanging fruits) and I will show you how we can apply it to find the projects that will generate big savings

In this lecture, I will show you how to use in practice the 80/20 rule also known as the Pareto principle.

In this lecture, we will talk briefly about applying the low-hanging fruits in practice. I will show you the principles of using it as well as a practical example.

Let’s look at how the quick win framework looks for savings. We will look at 2 dimensions:

• What are the potential savings we can achieve

• How easy it is to implement it?

We will have thanks to 4 categories of projects that we can consider:

• Cow savings – easy to kill and big

• Elephant – difficult to catch yet big

• Chicken savings – easy to kill yet you need to kill a lot of them not to be hungry

• Bat savings – small and difficult to catch

Remember that the potential reduction in costs depends on 2 elements: potential percentage cost reduction and the cost starting point:

• Potential % cost reduction

• Cost starting point

We will discuss this in this lecture

Imagine that you have to identify quick wins in cost reduction for an international chain of drugstores. We know their cost structure

• A few pieces of information about the firm that we will be analyzing

• They have 4000 stores

• We have their cost structure

• They have sent us a list of projects that will help them reduce costs

• Estimate the potential and group them using the quick wins framework

In this lecture, we will solve the previously introduced case

In this lecture, we will solve the previously introduced case

In this lecture, we will solve the previously introduced case

There are some ways to estimate the potential reduction in costs

• Get benchmarks

• Carry out a 1-day audit

• Measure a sample

• Ask experts

• Ask suppliers of tools / IT solution/machines

• Organize auction/tender

• Do a consulting project with a consulting firm

In the 4th section I show you how to reduce cost of process in practice. For that I will use an example of processes in a store. You will see how you should calculate the cost of the processes and what techniques you should apply to optimize processes and achieve cost reduction, savings.

I show you how to optimize processes in the store. I will use here real case of a company from home improvement / DIY sector. You will get also the model we used to calculate costs

Workshop was very important as I was getting a team that I did not know and that did not trust me. On top of that they did not know how to optimize processes. I will show you in this sections what were the goals of the workshop 

In this section you will see what kind of goals were presented to the project team

The team had no previous experience in process optimization. In this section I will show you the techniques  that we were using to optimize the processes 

Here you will find a short introduction to Lean manufacturing.  

Here you will find a short introduction to theory of constraints 

Here you will find a short introduction to Queuing problem 

Here you will find a short introduction to OEE  OEE stands for Overall Equipment Efficiency and is used to check how much of the time of the machine is used wisely

Here I will show you how in groups for chosen process the team has chosen the KPIs and cost drivers 

In this lecture I will show you an example of 1 process that was optimized with the team. I used this to show them the proper way of defining the KPIs, cost drivers and optimizing the process using this data

In this lecture I will show you an example of 1 process that was optimized with the team. I used this to show them the proper way of defining the KPIs, cost drivers and optimizing the process using this data

Finally, during the workshop I show them the timeline of the project to get confirm that the project is doable within this ambitions timeline 

In this lecture I will show you some information on what we achieved during the process optimization and how the test store looked like

Here I will show you how we optimized the process of changing prices in the store and what savings we managed to generate

Here I will show you how we optimized the process of changing prices in the store and what savings we managed to generate

Here I will show you how we optimized the process of shelf replenishment in the store and what savings we managed to generate

Here I will show you how we optimized the process of shelf replenishment in the store and what savings we managed to generate

Here I will show you how we optimized the process of advising customers in the store and what savings we managed to generate

Here I will show you how we optimized the process of advising customers in the store and what savings we managed to generate

Here I will show you how we optimized the process of advising customers in the store and what savings we managed to generate

Here I will show you how we optimized the process of advising customers in the store and what savings we managed to generate

Here I will show you how we optimized the process at cash till and info point in the store and what savings we managed to generate

Here I will show you what other potential improvements we suggested in order to sell new projects

In this lecture I will show the estimation of cost

In this lecture I will show the estimation of costs and savings achieved during the project

• In the 5th section we will discuss Make-or-buy analysis. You will be carrying them out after you have implemented the quick wins. They will help you find ways to further reduce costs. Make-or-buy analysis is extremely important tool that will help you decide in a rational way what you should do in-house and what to buy

Here we will discuss a very useful concept that is used in business and should be also used when making serious long-term decisions the so called the total cost of ownership

Let’s imagine that you were to decided whether it makes more sense to buy a car or to use Uber

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Imagine that you have to analyze for a consulting firm whether it makes sense or not to produce online course devoted to Data Science. In this lecture I will show you a few information about the firm that we will use to pick the optimal solution

In this lecture we will solve previously introduce case study. We will have a look at the make option

In this lecture we will solve previously introduce case study. We will have a look at the buy option and we will compare make and buy options.

In this lecture we will solve previously introduce case study. We will have a look at the buy option and we will compare make and buy options.

In this lecture we will solve previously introduce case study. We will have a look at the buy option and we will compare make and buy options.

We are back to Maria. Using previous case study we will try to decide which activities she should delegate using the make-or-buy analysis.

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

A lot of money can be saved by proper investment policy. In this section I will show you how to analyze in practice investments aiming at reducing costs

In the next lectures we will see how to calculate whether an investment that will help us save costs makes sense or not. This time around we will do it for a retailer and we will see whether investment in LED bulbs makes economic sense

In this lecture we will solve previously introduced case study

In this lecture we will solve previously introduced case study

In this lecture we will solve previously introduced case study

In this lecture we will solve previously introduced case study

In the next lectures we will see how to calculate whether an investment that will help us save costs makes sense or not. This time around we will do it for a ceramic tiles producer. We will see whether an invesment in robots makes sense

In this lecture we will solve previously introduced case study

In this lecture we will solve previously introduced case study

In this lecture we will solve previously introduced case study

In this lecture we will solve previously introduced case study

Here I show you how to analyze the profitability of sales channels in Consulting

Here we show to analyze the profitability of sales channels

Here we analyze the situation for cases when you are selling smaller services i.e.per hour consultation on SEO tactics

Let’s imagine that you have to decide which method to support sales reps that work for retailers will be the best one. Help you customer analyze which method is better. We will discuss what other methods are used by your competitors and what you should pay attention to in order to decide which methods is better

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Last way to boost your profits without scaling is to get rid of non-core assets. In this lecture we will discuss the general rules for identifying which assets should be sold

In the next 3 lectures I will show you how to sell non-core assets. We will use the case of cosmetics producer

Here I will show you the solution to the previously introduced case

Here I will show you the solution to the previously introduced case

In this section, I will show you how you can cut costs by reducing the usage of certain things that your firm is using

Imagine that you are analyzing a newly bought company that is providing Data Science services. Your boss wants you to look at usage and decide what to reduce

A few information about the firm that we will be analyzing

• The company has 500 Data Scientists

• You got data on what Software and tools they use

• Eliminate things they don’t use

In this lecture, I will show you the available for the case study data

In this lecture we will show you the solution to previously introduced case study

Now we will have a look at a cosmetics producer and we will try to measure how much they can save by using less. We will look at 3 areas of their activities

Below some information about the firm we will be analyzing

• They want to minimize number of bottles they use

• The are considering visiting less frequently customers

• They want to move 2 offices into 1 bigger office

• Check how much they can save

In this lecture I will show you the available for the case study data

In this lecture we will show you the solution to previously introduced case study

You were asked to help the drugstore chain find potential savings by introducing cheaper substitutes. You have picked 4 potential topics

A few information about the firm that we will be analyzing

• They have 4 000 stores

• They want you to analyze Head Office costs

• In Head Office you have picked 3 topics: water, tea & coffee, paper

• You have also decide to have a look at boxes they use for the e-commerce

In this lecture I will show you the available for the case study data

In this lecture we will show you the solution to previously introduced case study

In this lecture we will show you the solution to previously introduced case study

Before you start analyzing the waste you have to somehow group it by stages of occurrence and type of waste

For finding the potential improvements in waste I propose the following approach:

• Measure and allocate waste by stages and type of waste

• Pick specific type of waste and the stage you want to tackle

• Find the root cause

• Find the improvement

• Calculate whether it makes economic sense or not

Imagine that you work for a plywood firm with 3 factories and you have to decrease waste. A few information about he firm:

They have 3 plants

• They have different waste level

• You can find waste: in too big level of wood usage or plywood quality

• Estimate the potential impact on profit and cash

In this lecture we will be solving the previously introduced case study

In this lecture we will be solving the previously introduced case study

We are done with the main methods in which you can lower the costs. I hope you have enjoyed our framework as well as the case studies. We will be adding case studies to this course, but if you want us to cover specific problem you are currently facing, please let me know.

To make certain things more understandable when it comes to Cost Reduction we have decided to add to this course also a part of our course on Personal Finance. In this section I will show you how to cut costs, spend less in private life. This last section is not compulsory but I believe will help you understand certain things that may have seemed a bit abstract. The additional benefit is that you may be able to save some money. We have applied here similar framework that we have used for the firms, so most of the things we show here can be used also in firms as well.

Before you move to explore this section if you have any questions, request regarding Cost Reduction projects please let me know. I am always happy to help with whatever I can. We have done numerous project around that in the last 14 years so I believe we will be able to answer most of your questions.

So, enjoy the rest of the course devoted to Spending Less!

In the last section I will show you how to reduce your own private spending, expenditures. These examples will help you understand and implement the general approach to cost cutting. It will also help you reduce your own personal wealth

Here I will show you the general framework for building wealth that we will use in the whole course. In this lecture we wil go in detail when it comes to ways in which you can spend less and save more

There are plenty of reasons why you have to first see on what you spend currently your money. We will discuss them in this lecture

Let’s start with the goal. You want to see on what categories you spend money and how much they make in your monthly spending. There are 4 approaches to gather data on how much you spend and on what. We will discuss them in this lecture

Imagine that you have to help your friend Giuseppe analyze his spending. He has gathered data for the last 2 months

Here we will discuss the data that we need for the case study. We will have a look at expenses of Giuseppe.

In this lecture we will solve previously introduced cases study.

In this lecture we will solve previously introduced cases study.

In this lecture we will solve previously introduced cases study.

In this lecture we will solve previously introduced cases study.

Just as reminder reducing usage is one of the ways in which we can spend less. Now we will talk about this in details

We are back to Giuseppe. Since we know that he is spending too much let’s try to see how much he can save by reducing frequency of certain activities

In this lecture we will solve previously introduced cases study.

In this lecture we will solve previously introduced cases study.

Let’s imagine that you were to help Maria reduce her one-offs expenses by reducing the frequency of purchase. There are a few things that we know about Maria. Use them to decide how often she should replace: domestic aplliances, clothes, smarthpones, laptos and others

Here we will have a look at data that we will use for the case study

In this lecture we will solve previously introduced cases study.

In this lecture we will solve previously introduced cases study.

I will show you how ot use the low hanging fruit framework to decide which expesnes you should reduce

Just as reminder eliminating some expenses is one of the ways in which we can spend less. Now we will talk about this in details

We will start by discussing how to identify which expenses are worth eliminating. Later on as always we will move on to case studies. There are 3 main reasons why you should eliminate certain expenses

• Eliminate things you don’t use

• Eliminate things you don’t enjoy

• Eliminate things that are harmful

We will discuss it in this lecture

Help Peter decide which things he should altogether eliminate from his expenses. He has gathered data on his annual expenses to be data driven

Here we will have a look at the data for the case study

In this lecture we will solve previously introduced cases study.

Another great thing that you can use to spend is less is simply to look at the prices you pay and change them

We will start by discussing the general approach to renegotiating the prices

We are back to Peter for a second round. This time around you will be asked to estimate how much he can save by renegotiating prices.

Here we will have a look at tha data that we need to solve the case study introduced in the previous case study

In this lecture we will solve previously introduced cases study.

Total Cost of Onwership is an important concept that allows us to make the proper decisions. In the next few lectures we will discuss this concet in details and I will show you how to use it in practice

Here we will discuss a very useful concept that is used in business and should be also used when making serious long-term decisions the so called the total cost of ownership

Let’s imagine that Peter is considering 2 choice: buying an apartment or renting it. Let’s use the total cost of ownership to see what makes sense.

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Here I will show you when it makes sense to use the Total Cost of Ownership concept

Staying in shape can help you drastically reduce your expenses. Here we have both direct as well as indirect impact. We will discuss the benefits of staying in shape & healthy and why it makes impact on how much you spend

Lukas is a bit overweight and not that fit. You want to prove to him that this is very costly for him and that he can save a lot by exercising and eating less

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture we will talk briefly about applying the low hanging fruits in practice. I will show you the principles of using it as well as a practical example

Goals are good as long as they are SMART. In this lecture we will talk briefly about applying this useful concept in practice. I will show you the principles of using it as well as a practical example: some of them general and one specific for consulting

Whether you clean, cook, wait in the line you are effectively using your precious resource that is also limited – the time. Time like money is limited and you can exchange between each other. Calculating the value of your time is a next step that will help you save money.  We will dsicuss it in this lecture

Let’s imagine that you want to help Maria use her time wisely. Therefore, you want to show how much she invest in daily things expressed in money

In this lecture I will show you the solution to previously introduced case study

You can use the value of time for 3 things

1. Make-or-buy analysis

2. Spend less

3. Earn more

We will discuss it in this lecture

As we have suggested you should use the value of your time to decide whether you should do something personally or you should buy it /delegate it

We are back to Maria. Using previous case study we will try to decide which activities she should delegate using the make-or-buy analysis.

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Let’s imagine that you were to decided whether it makes more sense to buy a car or to use Uber

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Now we will move to spending efficiency. This time the efficiency we will measure in happiness level per 100 USD spent. Let’s have a look at a short example that will exemplify what we have in mind

Let’s imagine that you friend Oliver wants to optimize the money he spends on his relations with his girlfriend. Help him find the optimal solution

We will have a look at data that we need to solve the case study. In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Many people are stacked with expensive debts. You have to deal with them to reduce your overall expenses. There are some golden rules that you should follow when it comes to debt reduction. We will discuss them in this lecture

Let's have a look a nice approach that is the most useful when it comes to reducing debts

Let’s imagine that you have to help Adam and Eva deal with their debts. They want to lower the amount they spend on interest paid. Have a look at their debts

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

Another step you can take is to repurpose assets that don’t generate income. We will discuss it in detail in this lecture

In this lecture we will have a look at an  approach we propose to handling the assets

Tomasz & Monika married 5 years ago and they have decided with his wife to go through their assets and put them to use. Help them with this task

Just as a reminder you were supposed to help Tomasz and his wife to go through their assets and put them to use. First you had to divide into 4 groups

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

The last thing worth considering that will help you spend less is to check the end outcome before investing. We will discuss this subject in this lecture

Let’s imagine that you were to help George decide whether it makes sense to go to USA for MBA

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study

In this lecture I will show you the solution to previously introduced case study