Trimming unnecessary costs is a time-proven strategy for elevating business agility — and a good idea under any conditions — but not all cost-cutting is created equal.
Businesses that adapt well to change practice ongoing strategic cost management, focusing their efforts on areas that have little or no effect on the company’s strategic position. Preserving — or even increasing — budgets that support key strategic drivers can position an organization to maintain its competitive edge and outpace competitors who will need to play catch-up. In making strategic decisions on which costs to cut as part of an agility-building process, a good place to start is with value stream mapping.
Logic20/20 creates value stream maps to help our clients visualize and evaluate the series of events that result in a specific product or service. Taking a long-range view of activities within your core business creates measurable, defined stages of opportunity that build upon one another to enhance the impact at each step.
Our approach to value stream mapping utilizes both a top-down and a bottom-up approach to distinguish value-add from non-value-add activities, offering a clear picture of the optimal areas for strategic cost cutting. By defining concurrent work streams and identifying crossovers in resource allocation and data utilization, we uncover opportunities for optimizing the return on every dollar spent. When the process is complete, you have a strategic plan for setting budgeting priorities across departments.
Below is an example of how used value stream mapping to help a healthcare client streamline its patient services:
Value stream mapping enables you to