Case Studies

Corporate-wide Cost Reduction Should Be Thoughtful and Systematic

After a major divestiture, the Client needed to reduce 25% of costs from its corporate services area (including CFO functions, asset administration, human resources, legal, actuarial and building services) in order to right-size the group, remove unnecessary fragmentation, and maintain a competitive cost structure for the remaining businesses. The newly-formed executive team, rather than force across-the-board cuts, wanted to take a thoughtful approach to reducing costs. Difficult decisions had to be made if they were to re-align the cost structure while maintaining adherence to rigorous regulatory and compliance requirements.

To address this challenge, the Client chose to take a methodical approach to cost savings by evaluating short- and long-term organizational, process, automation, and non-FTE expense efficiencies. They wanted to objectively right-size Corporate Services to remain cost competitive and viable for future growth while eliminating all expenses that no longer drove value. The Client selected North Highland as a consulting partner to lead this important project and provide an independent point of view. As a result, the team eliminated many non-essential functions, consolidated similar jobs, renegotiated internal service levels, and transferred highly-specialized activities to 3rd parties. The team also identified several million dollars' worth of work that should have been charged to external parties and formalized a charge-back process for these services. Altogether, the initiative resulted in over $29M in annual savings – a 9X return on investment in the first year alone.

Access the complete case study to learn more about how North Highland helped deliver this cost savings project to the client.