The document outlines a methodology for sustainable cost reduction that moves beyond traditional practices by integrating sustainability into cost-saving measures. It emphasizes the importance of cross-functional collaboration among various teams to identify and implement cost-saving strategies, ultimately improving long-term profitability. The approach aims to generate significant savings while ensuring growth, and provides a structured process for companies to achieve measurable results.

1. SCORE: Sustainable Cost Reduction | February 2016 | © 2012-2016 Proprietary and Confidential shared.value.chainPage 1
Delivering triple bottom line savings
SUSTAINABLE COST REDUCTION

2. SCORE: Sustainable Cost Reduction | February 2016 | © 2012-2016 Proprietary and Confidential shared.value.chainPage 2
Subject Situation Target Group Value Success factors
What is it about? Why is it of interest? Who is interested in it? What is the benefit? How does it work?
• Sustainable Cost
Reduction goes beyond
traditional cost reduction-
it is focused on
reducing costs through
sustainable practices
• Companies are often
using cost reduction with
a focus on short-term
gains and therefore miss
out on long-term
possibilities for cost
reduction
• Cost reduction is one of
the most important
ongoing issues in
businesses and ensures
continuous profitability
• At the same time,
sustainability has proven
to enhance a company’s
profits and preparing it for
future possibilities
• The public and
companies’ stakeholders
increasingly demand
sustainability to be taken
into account.
• Our approach is
interesting for all
companies who want to
reduce costs
• It is designed for a cross-
functional team of
purchasing, production,
sales, supply chain,
logistics etc. who will
jointly work on reductions
• As a result top- and
middle managers can
rest assured that cost
reductions are
achievable
Sustainable Cost
Reduction helps you to..
• ...determine all
opportunities for your
cost reduction and what
you can do to implement
them
• ...gain a perspective of
levers for cost reduction
and how to use them
• ... invest in the right
activities which ensure
short- and long-term cost
reduction without
jeopardizing growth
• Proven project structure
with ~10 product-specific
workshops to identify
levers throughout the
entire product portfolio
• Development of ideas for
cost reduction and
translation into concrete
project ideas with
responsibilities
• Proven and hands-on
implementation
philosophy with a project
management office
Exemplary project approach Illustration of deliverables and benefits Your chance
Next steps
• Take advantage of our
expertise and methods
• Secure a competitive
advantage through a
structured process
• Contact us today:
info@sharedvaluechain.com
• +49 89 461 331 686
Sustainable Cost Reduction can help to deliver triple
bottom line benefits

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We use our proven sustainable cost reduction methodology
(SCORE) to deliver results
Market
induced
change
1
Top Management
Cross-functional teams
Opportunity
Workshop
2
Cost
Reduction
PMO
3
• Identify market need /
competitor action
• Identify product groups
that have to improve
its cost position
Business Units and Functions
• Cross-functional workshops
to identify and develop cost
reduction opportunities
• Detail high potential
opportunities in measure
sheets
• Agree on an action plan
• Implementation of
agreed and consigned
measures
• Resource allocation
and prioritization
Benefits of using SCORE
for companies
• A proven method to identify,
develop and implement
additional cost reductions
• High rate of implemented
measures due to commitment
of cross-functional teams
• New perspectives and levers
to reduce cost along the
product lifecycle and along
the value chain
• The approach creates an
internal community of
engaged cross-functional
teams
• A project management office
supports follow-up,
measurement and
implementation support
• Measurement of progress and
results according to standard
metrics and best practices
The ROI of our SCORE
between 1:10 and 1:100
The ROI of our SCORE
method is typically
between 1:10 and 1:100
• Track follow-up
• Support teams during
implementation
• Resolve conflicts of
interest between
management and
business units
SCORE = Sustainable Cost Reduction Methodology
• Reconciliation with Controlling
and savings measurement

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Product Cost Optimization Workshops – Identify savings
potential of 12-16% of COS
RESULTS
• Savings potential as 12-
16% of COS identified
• Several hundred ideas
were identified and
around 15% of these
formulated in detail
1
2
3
4 Client Situation
Challenge
Approach and Solution
“Take Aways”
• Client is a € 700 Mio. German Electronics company, delivering
products, solutions and services in the industrial environment of
power, signal and data.
• Though still in a beneficial economic situation, the company has
set itself the goal of increasing its growth profit margin (GPM) to
50%.
• In order to reach its Gross Marging
targets, the company had to
drastically reduce its cost of sales
• At the same time, the client aimed
to raise its turnover by 40% over
the next 5 years.
• The company had already
undertaken certain measures to
reduce costs, mainly within its
production set up (lean etc.), and
wanted to identify further savings
• The objective was to identify
significant savings potential to be
realised in the next 1-2 years
without jeopardizing growth.
• shared.value.chain supported the client in conducting workshops
to generate ideas and measures to improve costs, esp. COS.
• The workshops were conducted within multi-functional teams
(product development, quality, purchasing, SCM, controlling,
product management) for different products/ product groups.
• Technical support and moderation enabled multi-functional
teams to identify a broad range of new and unique saving ideas.
• Start early to optimize your
cost saving approach – don’t
wait until the market forces
you to do it!
• Introduce a project
management office to
manage/track the agreed
savings and project
approaches.
• Use the power of cross-
functional teams and align
constantly with project owners.
• Take a ‘we’ instead of an ‘I’
approach to unlock the
potential within the company.
Case Study

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Your Contact
Adams-Lehmann-Straße 56
80797 München
Tel. +49 89 461 331 868
Mobil +49 170 768 58 61
mdheur@sharedvaluechain.com
http://bit.ly/1G1vpcm
We help companies to achieve sustainably better performance
Diplom-Kaufmann
Michael D‘heur
Founder & Managing Director
Springer Gabler;
Deutsch; Published Oktober
2013.
More Information:
http://bit.ly/1fTcrWg
Springer International;
Englisch; Published April
2015.
More Information:
http://bit.ly/1fTcrWg
http://linkd.in/1NtS3ch
http://on.fb.me/1xsHxzO
http://bit.ly/1HePpFy
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