The go-to handbook on cost reduction

Our new book

Fit for Growth

A practical approach to business transformation

Fit for Growth is a guide for senior executives and middle managers on how to align their company's costs and organization with their strategy so they can grow, create value, and sustainably outperform competitors.

Buy the book  Read chapter 1

The big idea

Very few organizations manage their costs for sustainable success. They spend their money on the wrong things or they cut the wrong things for the wrong reasons, ultimately leaving them weaker and unfit to compete. Instead, organizations need to think about their costs strategically, as investments that will fuel their growth, so they put their money where their strategy is. They need to continuously cut bad costs and redirect resources towards good costs that build or strengthen differentiating capabilities.

We developed the Fit for Growth* framework based on research into hundreds of companies across various sectors. What we found: Those who best follow the Fit for Growth principles achieve higher total shareholder returns than those that do not. Their secret? They tightly link their growth and cost agendas to fuel growth.

The situation

Whether you’re trying to jumpstart flattening revenues or racing imminent bankruptcy, companies are realizing that the only way to unleash profitable growth is to cut costs, often dramatically.

In the globally interconnected, digitally disintermediated market full of activist investors in which enterprises operate today, there is no safe harbor when it comes to the bottom line. Companies need to focus on managing costs as rigorously as they concentrate on increasing revenues. As with any living organism, there is no profitable growth without equally robust pruning.

The solution

We’ve devoted 70 years of collective experience to helping dozens of companies answer affirmatively: Are you fit for growth? Companies that are fit for growth do three things consistently and continuously:

  1. Focus on a few differentiating capabilities
  2. Align their cost structure to these capabilities
  3. Organize for growth

About the book

Fit for growth companies enjoy higher shareholder returns and sustained growth. Why? Because they put their money where their strategy is. Through constructive cutting, fit for growth companies connect their costs with their strategy so they can invest resources in what truly differentiates them from the competition. They cut costs at the right time, from the right spots, in the right way to stay lean, fit, and ready to pursue growth.

Fit for Growth lays out the framework managing costs in a strategic way using detailed, real-world examples so that leaders across all industries can get their companies into shape — the right way.

Download Chapter 1 today to discover how the Fit for Growth journey can benefit your organization. Here’s what’s inside each section of the book:

  • Introduction and Fit for Growth overview
  • How to cut costs and grow stronger: A manager’s guide
  • Sustain the change

Introduction and Fit for Growth overview

Cost cutting seems like a basic business concept. Yet it is one of the most misused — if not abused — areas of management. Too often, companies disconnect strategy and cost management. The result: Those capabilities that make a company truly competitive are starved, while cost centers that add little value grow unchecked. Companies that manage their costs right do it from a position of strength so they are ready to grow; they maintain the roof while the sun is shining.

In this section, we explore:

  • How to determine if your company is fit for growth
  • Why you need to change your mindset from cutting to optimizing costs
  • Best practices for structuring and leading transformational change

Download chapter 1

How to cut costs and grow stronger: A manager’s guide

Whether a company wants to survive or thrive, executives need to know where, how, and why to cut constructively to set up future success. Companies that focus too much on shrinking their costs lose sight of the need to invest in their differentiating capabilities. In short, they use an axe when what is really needed is a strategic pruning of unhealthy growth. The Fit for Growth approach takes the guesswork out of applying the right way to manage costs.

In this section, we explore:

  • How to set the framework for a Fit for Growth transformation
  • How to use the nine levers, or tools, to make constructive cuts
  • Best practices and pitfalls to avoid when using each lever

Sustain the change

There’s a reason most transformation efforts fail: It’s easy to revert to past behaviors. Becoming fit for growth is about building a cost-conscious mindset by aligning costs with strategy. But to make it sustainable, you must embed new behaviors and spending habits into your organization. That’s why the Fit for Growth framework is predicated on a foundation of cultural change. By changing how their companies look at, think about, and manage cost, executives can break the repeated cycle of bad cuts and focus instead on sustainable cost management strategies.

In this section, we explore:

  • How to mobilize, scale, and run a successful Fit for Growth transformation
  • How to enlist culture to enable change
  • Tools and techniques for making constructive cutting an ingrained habit — even a prized value — in your organization

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A practical approach to business transformation

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A practical approach to business transformation.

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Get to know the authors

The authors bring more than 70 years of combined strategy and business transformation consulting experience and the unrivaled industry and functional capabilities of the PwC network to solve companies’ toughest problems and help them capture their greatest opportunities.