Drive business performance with strategic cost optimization

Identify which costs to reduce and protect to drive growth and efficiency, even during inflation

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    Discover 3 keys to managing your organization’s costs

    Your guide to optimizing costs strategically, not tactically.

    Strategic cost optimization rarely succeeds without three things:

    1. Standardized cost management framework
    2. Shared understanding of cost-to-value relationships
    3. Consistent definition of success beyond cost savings

    Download this guide to increase the success of your strategic cost optimization initiatives.

     

    Strategic cost optimization delivers on costs and growth simultaneously

    Organizations have been reintroducing costs while pursuing postpandemic growth opportunities, but now must optimize costs to navigate new economic headwinds, including input shortages and inflation

    In these conditions, it’s even more important to optimize costs without compromising growth. Watch this video for a quick primer on strategic cost optimization. (Also see the FAQ, “Is cost optimization my responsibility?”)

     

    A cost management framework to prioritize investments

    The Gartner Cost Optimization Decision Framework helps you and your fellow executives prioritize cost optimization opportunities by value, not just the potential to reduce spending.

    Use this framework to:

    • Create a prioritized list of your most promising cost optimization opportunities based on a shared framework
    • Assess the level of impact of your cost plans across key decision factors/criteria
    • Evaluate the trade-offs between the benefits, costs, risks, and viability of different cost control initiatives
    • Map cost reductions on a simple grid to show the trade-offs and help build buy-in for your cost reduction strategy

    Download the cost optimization framework for your function

    Additional cost optimization questions Gartner can help answer

    Cost optimization is a business-focused, continuous discipline to drive spending and cost reduction, while maximizing business value.

    By taking a strategic cost optimization approach, business leaders can make more informed budgeting and spending decisions while investing for growth and digitalization.

    Strategic cost optimization is a cross-functional collaborative effort across functions and businesses — and their leaders. It is not the job only of the CFO or finance team.

    Given the inflationary environment, for example, margin management (e.g., pricing changes) can provide some respite against rising costs, but executive leaders must manage the pressure on profitability together. Three actions are needed to optimize costs without compromising growth:

    • Align costs disproportionately to enhancing points of differentiation (e.g., digital capabilities that competitors cannot easily replicate).
    • Embrace positive aspects of zero basing (i.e., a focus on value) beyond budgeting season to how ongoing spending decisions are made.
    • Digitalize at scale to unlock productivity gains that can offset inflation.

    Gartner is a trusted advisor and an objective resource for more than 14,000 enterprises in 100+ countries.

    Learn more about how we can help you achieve your mission-critical priorities.