We conducted independent, anonymous opinion research among 525 senior financial decision makers from across Europe’s largest companies. In addition, we surveyed 1,200 individuals across Europe using our Commercial Engagement Index (CEI) tool to assess the degree of ‘cost consciousness’. Respondents were split between Senior Managers, Middle Managers and Frontline workers (400 of each) for comparison purposes.
The findings from this research form a new report, The Cost Boomerang – which shows that the majority of cost savings made during recession are set to return.
What we found was a massive opportunity for those organisations that are able to significantly raise the cost efficiency bar by examining more strategic options for cost-cutting, fundamentally changing their business and organisational models, and instilling a cost-conscious culture throughout their workforce:
- The vast majority of cost reductions made during the recession (93% on average) are not believed to be sustainable;
- Costs are quickly creeping back into the business as many companies turn their back on cost-cutting measures to refocus their attention on growth;
- Most executives believe that costs will return across the board, with significant increases expected in the cost of finance, salary inflation and rebuilding headcount; and
- Around 45% of respondents suggested that their organisation did not have a clear enough view into their component cost base to make sustainable cost-cutting decisions.