14Running a Cost TransformationMobilizing, Scaling, and Sustaining

Now that you have learned the strategy behind a Fit for Growth transformation (Part I of our book) and are familiar with the various cost levers a company has at its disposal (Part II), we will next discuss the process needed to transition your organization to be Fit for Growth.

Companies are forever making themselves over in response to performance goals and strategic priorities. The usual way these changes are implemented—by embedding them in business plans, then having managers throughout the company execute them—works well when the goals revolve around a specific function or business unit and involve relatively incremental changes. In these situations, the changes can often be included in an annual planning and budgeting process and executed as part of business as usual.

But when a true transformation is needed—when the company is setting out to dramatically reshape its cost structure and organization—the typical business-as-usual approaches are insufficient. Transformations of this sort include five to 10 simultaneous, large-scale initiatives. They cut across the lines of businesses and functions, and affect the entire organization. They require meticulous planning and execution to achieve their objectives, and take 12 to 24 months to complete. Given their level of complexity, such transformations cannot be executed as part of business as usual—they require something different. They require a programmatic ...

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