PA financial services expert, Amdi Hansen, has been quoted in an article in Børsen discussing PA’s Cost-Out Maturity research, and how a long-term cost out strategy can help companies reduce costs. PA’s analysis reveals companies in the financial services industry can reduce their costs by up to 30 per cent by implementing new IT systems and by having a constant focus on costs.
Amdi says: “Not having a constant focus on cost effectiveness may result in layoffs. At the end of the day, it will affect either the employees as they are made redundant or the client as prices will increase.”
According to Amdi, banks have been focused on reducing costs during recession and when inflation returns, they increase their sales and service activities, thus increasing costs. Once costs need to be reduced again, it often results in one-off solutions and layoffs. Instead, organisations should ensure costs don’t get out of control in times of growth.
“In a growth period, companies need to prepare for more difficult times. The span between recessions tend to become shorter. If banks, for instance, have a two-sided focus, they will be able to prolong the growth period,” says Amdi.