You shouldn’t wait for performance pressures to start challenging your cost base – be proactive, rather than reactive. It is mission critical for businesses to prioritise cost-cutting measures, whatever scenario they find themselves in.
What we do
Our approach combines rapid diagnostics, rigorous implementation, and effective change management to drive enduring outcomes, through embedding a culture of continuous improvement and efficiency. We look across the value streams of your business, using our proprietary frameworks and approach to deliver industry-leading solutions for you.
We bring the experience of helping clients across the full spectrum of cost scenarios, leveraging a mix of industry, cost, functional and change skills required to successfully deliver cost programmes. Our core team of over 500 cost experts worldwide is supported by dedicated Data and Analytics teams to enable data-driven decision-making and deliver rapid results.
Impact stories
Utility Client
The client is a leading energy infrastructure and solutions provider, with annual revenues exceeding £16m.
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Transport infrastructure client
The client is a leading infrastructure owner and operator, renowned for its expertise in managing and maintaining the UK’s rail network.
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Construction and Engineering client
The client is a leading infrastructure solutions provider, known for its expertise and innovation in the construction, transportation, and energy sectors.
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Media client
The client is a leading media and entertainment company. With a strong focus on digital platforms and emerging technologies, the company has established a significant presence in the global media landscape.
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Utility Client
The client is a leading energy infrastructure and solutions provider, with annual revenues exceeding £16m. KPMG were engaged to reduce operating costs to meet regulatory and shareholder targets. This translated to a £200 million reduction in annual expenses.
KPMG Approach
- We implemented a comprehensive zero-basing program across the organization. This involved challenging all activities and costs from a zero base, rebuilding teams from scratch, developing and owning opportunities in the line organization, and ensuring safety was not compromised.
- We played a crucial role in the success of the program by structuring and facilitating the approach, tailoring it to client needs, training client teams, facilitating and challenging teams, supporting management team decision-making, and setting up the implementation approach and structure
KPMG’s Impact
- The zero-basing program delivered significant results for our client, including £200 million per annum of savings, a fundamental re-set of work processes, elimination of organizational overlaps and duplication, and embedded ownership for opportunities
Transport infrastructure client
The client is a leading infrastructure owner and operator, renowned for its expertise in managing and maintaining the UK’s rail network. It has revenue of £8.5bn, and 40,000 employees. KPMG were engaged to re-design their capital delivery structure with approximately 40% less internal resource.
KPMG Approach
- We developed baselines, internal and external benchmarks to develop initial opportunities
- We worked with the client to build out opportunities including process and organisational impact
- We developed a revised contracting strategy
- Lastly, we developed implementation plans and approach
KPMG’s Impact
50% reduction in resource, driven by:
- Streamlining programme management standards
- Improve operational planning processes to avoid re-planning
- Aligning level of assurance to risk and complexity
- Standardising & automating reporting
- Eliminating duplicated activity with supply chain
Construction and Engineering client
The client is a leading infrastructure solutions provider, known for its expertise and innovation in the construction, transportation, and energy sectors. It has revenues of £1.3bn, and c.3,500 employees. KPMG was engaged to support the executive team in their ambitions to simplify the business model and operating model, to drive the significant efficiency potential, and drive the delivery of their growth strategy.
KPMG’s approach
- We performed a strategic cost and operating model assessment, in which we developed a deep understanding of their current situation, revised strategy and business plan We then undertook a series of structured senior management interviews to gather a range of perspectives on potential opportunities, and undertook baselining and comparator analysis to quantify potential level of opportunities across the value chain
- The assessment was culminated in a series of senior management review meetings to align on the level of ambition, and set the scope for the future phases of design and implementation work
KPMG’s impact
This activity enabled us to deliver benefits across the procurement process, with key outcomes:
- The client has reported an increased operating profit margin of over 5%, through a simpler, more transparent cost and pricing model, and rationalisation of the property portfolio and headcount
- It is projected that c.£30m of benefit will be generated, split across three priority areas:
- Simplifying the organisation (45%)
- Improving procurement (25-30%)
- Improving project delivery efficiency (25-30%)
- Non-financial benefits have included embedding values and behaviours, a culture programme which included specific IDE initiatives, clearer job architecture, innovation and automation tools for efficient, effective, standardised work; clearer understanding of ESG impact.
Media client
The client is a leading media and entertainment company. With a strong focus on digital platforms and emerging technologies, the company has established a significant presence in the global media landscape. It has revenues of £4.2bn, and c. 3,500 employees. KPMG was engaged to conduct an assessment of the current state, and identify key challenges and opportunities related to their business processes, people, technology, and data.
KPMG’s approach
- We performed a rationalisation of geographical presence, identifying opportunities to consolidate or close locations
- We then benchmarked the clients spending against industry averages, and identified areas where costs can be realigned
- (op model adjustment/tech implementation)
- We also reviewed client's organisational structure and identified opportunities to streamline roles and responsibilities
KPMG’s impact
- Improve their business processes and efficiency
- Reduce costs and increase profitability
- Make better use of data to drive decision-making
- Become more agile and responsive to market changes
Making your change successful
Confronted with challenging external conditions, leaders often must take decisive action to keep the business on a sustainable footing.
However, the danger is that short-term cuts hold the business back from longer-term growth. We help take your business on an end-to-end journey, cutting out cost in a considered way which does not inhibit long-term viability.
In our experience, there are five critical factors to successfully deliver and sustain a significant change in your cost base.
How we can help you
No matter where your problem is, we can rapidly identify it and offer solutions tailored for you. Developing our solutions starts with a comprehensive analysis of your key drivers, examining your costs from multiple perspectives, including bottom up, top down or a combination of the two approaches. We do all of this using our Elevate toolkit – helping you unlock value at pace.
We can help you with the following areas across your value chain, including:
Related Insights
Contact us
To discuss how KPMG can help your organisation, please get in touch.
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