Cost Leadership: Efficiency, Processes and Profit [EN]

This course contains the use of artificial intelligence.

Cost leadership gets confused with saving money. Saving money is what happens in a bad quarter: budgets get cut, and six months later the costs are back and some good people are not.

Cost leadership is a property of how the company is built

It means being structurally cheaper than your competitors — profitable at a price where they break even. That is a very different thing from a decision to spend less, and the difference is where the advantage lives. A decision lives in a spreadsheet and can be reversed by the next person in the chair. A structure lives in processes, in the operating model, in how work moves through the company, and a competitor cannot copy it in a quarter because it took you longer than that to build. Which is why this course spends more time on process chains than on budget lines.

What this course covers

Forty-two lessons from the model down to a single cost line. The operating model first: what an efficiency-driven business is and which financial measures show it, turning strategy into financial goals, how models evolve from start-up to corporation, mission embedded into planned indicators, process chains and the black holes inside them, goal-setting people believe, the strategy pyramid, budgeting that produces decisions rather than documents, indicators across customers, people, processes and finance without killing motivation, Lean Six Sigma applied to financial processes, scaling without rebuilding, and what comes after efficiency. Then running the operation: the efficiency checklist, the strategy session and seven levels of strategy, culture as a delivery instrument with ten ways to embed it, the goal system and its launch, process building and automation, organisational structure with its five drivers and a diagnostic, project delivery templates, cash flow and monthly reporting, infrastructure including procurement and risk, and people management with the accountability table. Then describing processes: what a description consists of, which to describe first, methodology and a simple BPMN diagram, tools and templates, implementation and evaluation, five processes taken apart, and running the description project including defending it to management. Then improving them: waste, standardisation and maturity, five kinds of process map including the value stream, the improvement framework and its link to strategy, process architecture, the problem-solving toolkit from 5S and five whys to 8D and cause-and-effect diagrams, the advanced set including SIPOC, DRIVE and ICOR, and the culture that keeps improvement alive. Finally one cost line taken to the bottom: reading a large recurring bill, allocation and internal chargeback, rightsizing and commitments, unit economics per user and per transaction, and a ninety-day rollout.

Two blocks carry examples from a support function

The process description block uses one lesson of six to take apart five specific processes — hiring, settling in, training, review and exit — because they are simple enough to show end to end and everybody recognises them. The methodology in the other five lessons has no industry attached. The cost management block was recorded around technology spending, which is a particular category rather than a universal one: the allocation, chargeback and unit economics machinery transfers to any large recurring cost, the examples do not. Everything else — the operating model, the operations role and the optimisation toolkit — is about a company rather than a department.

Who is teaching this

I am Mike Pritula. I built the people system at Preply as it became a unicorn, and I have worked at Wargaming, iDeals and Alfa-Bank. More than 1.6 million students have enrolled in my courses across 185 countries, and over 150,000 specialists have gone through my programmes. I hold PHRi and SHRM-CP certifications and represent HRCI in more than ten countries.

What is included

• Lifetime access to all 42 lessons

• Active instructor support in the Q&A section

• A Udemy Certificate of Completion

• Working material: the operational efficiency checklist, the one-page strategic plan, the structure diagnostic, the accountability table, five types of process map, the problem-solving toolkit, the allocation models and the unit economics structure

• The operating model and the cost line in one course, rather than one or the other

Where to start

Take the last cost you cut and check whether it is still cut. If it came back, the problem was never the number — it was the process that generates it. Enrol now and start today.