What Innovative Cost-Saving Measures Can Significantly Impact a Company's Bottom Line?
CFO Drive
What Innovative Cost-Saving Measures Can Significantly Impact a Company's Bottom Line?
In the quest to enhance profitability, we've gathered insights from top financial executives on innovative cost-saving strategies. From adopting Zero-Based Budgeting to utilizing AI in recruitment to cut costs, here are five transformative measures that CFOs and CEOs have successfully implemented to boost their company's bottom line.
- Adopt Zero-Based Budgeting
- Balance Headcount with Expected ROI
- Implement Telehealth to Reduce Overhead
- Leverage AI for Efficiency and Marketing
- Utilize AI in Recruitment to Cut Costs
Adopt Zero-Based Budgeting
Every item of cost must be questioned. Proactive budgeting, zero-based budgeting, and planned strategic negotiation will help to bring down the costs. For repetitive and large procurements, enter into well-negotiated contracts. One can consider quantity discounts or early payment discounts, also subject to the availability of cash.
Balance Headcount with Expected ROI
What is the largest expense for most businesses, regardless of industry? Headcount. However, when was the last time you went department by department to attribute each role, full- and part-time, to the expected ROI?
Businesses can be equated to an ecosystem found in nature—they operate most effectively when in balance. With all this in mind, the most direct way to improve your bottom line is to ask yourself and your functional leads, for every $1 of growth, how many people of X function do you need?
Sales and Marketing are the easiest attributions. Salespeople have target expectations; they need some number of sales engineering or solutions architecture support to qualify sales prospects, sales development representatives to source prospects, and marketing support to build awareness and generate inbound lead flow. Account management and customer success and support are next. These teams generally think about account load in terms of active customer count or revenue under management.
Next up, research and development. This is where you need to look forward a year or two, depending on how long it takes to build new products and features. Your R&D needs today should be based on your growth targets tomorrow. Finally, G&A tends to have a step-function, but linear relationship with the business.
Implement Telehealth to Reduce Overhead
One innovative cost-saving measure we introduced was implementing a telehealth platform at SOBA New Jersey. This allowed us to provide remote consultations and follow-ups, reducing the need for in-person visits and associated overhead costs. The telehealth service also expanded our reach to patients who might not have access to our physical locations, increasing our client base without significant additional expense. This initiative significantly lowered operational costs and contributed to a 20% increase in revenue within the first year, demonstrating its substantial impact on our bottom line.
Leverage AI for Efficiency and Marketing
Innovative ways to reduce costs in a company require planning and good implementation. My most significant cost-saving measure has been the use of AI.
AI has helped me greatly to speed up the amount of work I do. As a finance person, words are not my forte. I can save time and money by using AI from the different apps I use for work. For example, AI helps a lot with marketing; in the past, I'd have to hire writers or coaches to help with these tasks. With AI being integrated into most marketing platforms, creating emails and forms, and following up with my audience have increased my revenue. Clients appreciate how fast their inquiries and problems are addressed, and new ones are delighted to join our firm.
I advise other business owners to implement AI in at least one business area, especially where they have the most difficulty.
Utilize AI in Recruitment to Cut Costs
Using AI in the hiring process has saved millions of dollars. At Kerplunk, we're finding that AI can handle many of the functions of a traditional recruiter. Fortune 500 companies spend millions of dollars every year on recruiter fees—they shouldn't. They already have the inbound generation; they just need a more effective way to screen, which is what Kerplunk offers through AI-powered one-way interviews.
