How I Accidentally Bankrupted my Company: A Cautionary Tale of Cutting Costs

02/07/2012

By Jane Grafton, Lieberman Software

Like every good story ours has a beginning, a middle and an end. While our tale is completely fictitious, the situation that our character finds himself in isn’t. It is based on real events happening in organisations across the globe. Perhaps, by reading it, you can avoid following the same path as our ill-fated CEO and change your destiny.

Pegasus was arguably the premier automobile manufacturer. It didn’t just ‘make’ cars, it created them. The drivers lucky enough to find themselves behind the wheel of a Pegasus didn’t just park it, they positioned it. If you didn’t already...

...own a Pegasus car then you aspired to own one. Pegasus stood for ‘living the dream’.

As you’d expect, to sit in the CEO’s seat of this established and well-respected organisation was coveted by many powerful men and women. For Charles Trumble, it had just become reality. Charles believed he was unstoppable.

Running a tight ship

With the country entering recession for the second time in just a few short years, and the manufacturing industry severely depressed, Charles knew it was going to be tough. Shareholders were restless, demanding faster returns on their investments, and he had to make a quick impression or risk the dream being over before it had really begun.

First step, go through the books with a fine-tooth comb and identify savings.

Of course, reducing the IT expenditure was a no brainer. The IT auditors, what did they really do and how could they justify the fee? And all those expensive ‘geeks’ in the IT department could go. No one understood a word they said so outsourcing the whole lot to Romania wouldn’t make a difference. All future IT spend could be frozen as they’d just upgraded the PCs, servers and operating system.

Never one to wait for someone else... continued on page two >

 

 

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