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cost centers general expenses

Office Supplies

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Printing Costs

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Photocopiers

Cleaning Services

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Office
Fleet Management

Travel expenses

Waste Management

Building Costs Management

Spend Management - Purchasing

finance costs

Finance Costs

Capital and Operating Expenditure

Tax costs

Accounting & Cash Management

Start-up costs

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IT asset management

IT Capex and Opex

Document automation

IT Governance spending

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PABX

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Storage - San costs

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VoiP

VPN costs

Mobile Wifi 2G 3G communications

Operational Capex / Opex

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Call-center expenses

Logistics & Supply Chain expenses

Maketing spending

Production operations expenditures

Packaging expenses
Freight costs
.

Looking for the unexpected benefit

To protect the confidentiality of our client and their customer, we have not detailed names

Profile
Sometimes a solution will have an effect on the deployment of staff inside the customer's business. However, this is often difficult to realise for various reasons not least of which the staff affected may be in your sponsor's department! Being creative in identifying the business benefits can allow a sponsor to justify the solution without impacting headcount.

Even if you are dealing with the CIO the benefits may come from general business improvements.

Background
The CIO is often charged with making the technical systems suitable for business to flourish and his only reward is criticism if there is downtime. Also technical experts are rare so justifying a solution on headcount saving is a non-starter. In this case the CIO required a $430k Intrusion Detection System (IDS) which he knew would reduce downtime based on the number of intrusions suffered in the last 12 months but he was finding it very difficult to justify to his CIO colleagues. The other company offices were sure that downtime was expensive but couldn't come up with an acceptable measure.

The company was in the process of implementing a company wide ERP system that would depend on a robust network that has a higher level of availability than was currently experienced. The CIO was able to identify with the help of the IDS salesman that one of the main benefits would be an improvement in debtor days as a result of improved network availability for critical tasks such as invoice production. He agreed to sponsor a one day reduction in debtor days at board level and this would justify the technical solution.

The business case produced by the IDS salesperson was a pessimistic view of likely benefits and ignored the other benefits that were considered but were not valued owing to lack of substantial information were:


Direct savings due to reduced downtime
24 hour cover
Reduction in costs for managing fewer suppliers
Better utilisation of existing network equipment
Reduction in engineering resource
Centralised management of internet gateways (reduced vulnerability of network to attack and / or loss of vital business data)

Result
What appeared to be a difficult justification became very easy once the benefits were closely aligned to the customer drivers i.e. successful implementation of the ERP system. A saving of one day from their current debtor days of 61 was sufficient to warrant the capital investment of $430k

 
DEAL DYNAMICS Initial Cost
Benefits total
$430k
$22k per month
BENEFIT Reduction in debtor days by 1day $22k
ROI MEASURES Payback
IRR
NPV
20 months
56%
+ $284k

 

source : Shark Finesse

 

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Cost Cutting Actions - Cost Savings Measures

● Office supplies cost saving measures
● Courier expenses & Overnight deliveries Costs saving measures
● Printing Cost Saving solutions & tips
● How to cut the costs of your fax system
● Printers & Photocopiers cost saving Solutions
● Cleaning cost savings suggestions
● How to cut energy costs - Energy Cost Savings Initiatives
● How to cut office Costs
● Fleet Management cost saving opportunities
● Environmental Management - Waste Reduction Measures
● Building management and control systems costs saving examples
● Purchasing & Spend management Cost cutting & cost savings solutions
● How to track costs and optimize accounting costs
● Defending budgets with Activity-based Costing and Management ABC/ABM
● Capital and Operating Expenditure (Capex / Opex)
● How to optimize the Return on Investment ?
● Finance and Cash Management cost savings Measures
● Operational Costs Cost cutting Initiatives
● How to reduce the labour costs ?
● How to Dramatically increase employee productivity?
● Internet cost savings solutions
● IT operation and maintenance cost savings measures
● IT Software Developement Cost cutting measures
● IT Asset Management - Upgrades and Migration, Data Sharing and Integration Cost Cutting measures
● IT ROI - Return On Investment on Information Technology Opex / Capex
● Document Automation cost cutting solutions
● IT Outsourcing & IT Offshore initiatives
● Open Source cost Saving solutions
● ERP - Database - Data Warehouse - Cost Cutting
● Cost Saving Solutions
● CRM (Customer Relationship Management) Cost savings measures
● IT Outsourcing & IT offshore initiatives
● Security cost saving techniques
● STORAGE - SAN - NAS cost saving suggestions


● Bringing the costs and pricing of telecommunication down
● VoIP - Voice over IP Cost Cutting solutions
● VPN - Virtual Private Network cost savings measures
● Mobile - GSM - UMTS - WiFi - RFID - Satellite cost cutting solutions
● Enterprise Management cost cutting applications
● E-procurement cost saving solutions
● How to cut the Sourcing costs costs - Sourcing cost saving measures
● Call Center & Contact Center cost saving solutions
● Supply Chain Management cost cutting opportunities
Marketing cost saving measures
● Production Cost Savings measures
● How to reduce the Packaging Costs
● How to reduce the Freight costs
● How to reduce travel costs ?
● Cost cutting techniques for manufacturing companies
● Fleet Cost Reduction
● Office cost cutting tips
● How to reduce the labour costs
● How to Cut HR Costs
● Cutting cost hospital initiatives
● Cutting The Logistic Costs
● Cheap airfare Cheap ticket low cost flight
Cost saving purchasing to management
● Truck fleet money saving ideas
● Cost saving suggestions for safety
● Cutting ink costs
● Call Centers Cost Cutting suggestions
● Airline ticket saving ideas
● how to cut telecom costs with VoIP

● Cheap flights, low cost airline and low air fares tips

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