Cost Cutting is a Mentality Not a Strategy

"Whenever I read about some company undertaking a cost cutting program, I know it's not a company that really knows what costs are about. The really good manager does not wake up in the morning and say 'This is the day I'm going to cut costs,' any more than he wakes up and decides to practice breathing."

- Warren Buffett

In my line of work, we are constantly coming across firms whose top priority is cutting costs. Obviously to a tech company providing web application development, and trying to push the limits of what is possible on the web, this isn't exactly music to our ears - but it should be.

A member of management once asked me, "Ben, how can we cut costs?" He brought up great ideas like double checking with two or three vendors before a print project, or challenging our assumptions on expenses of signage, banners, conference materials, etc. Even the concept of shutting down computers and turning off the lights came up.

These were all valid ideas, and I was initially surpised (and a little dissapointed) in myself for not being able to rattle a list of ten cost saving ideas off the top of my head. But the more I thought about what things would really make a difference, the more I realized that, unlike good design or other great inventions, saving money doesn't come out of a flurry of short-term necessity. It comes from people who practice it way before management tells them to.

It was then that I realized I had been cutting costs, for about the last ten years. As far as marketing budget, I have made a reputation for being a practicing meiser with my company's money (which isn't always a good thing). For example, out of 100 or so people in our firm, it turns out my laptop is the oldest one currently in use. That's not even among the power users, that's all employees. My other laptop (the Macbook Pro) is three years old. I've rebuilt it myself four or five times, including Windows XP and Vista virtual machines each time. I'm not going to say I'm the companies biggest time-saver, because it consumes hours to be your own tech support, but as far as costs... And what about software? Probably half the software I use is free, open source problem-solving shareware (fine, the other half is the entire Adobe Design suite, and Microsoft's entire MSDN library of software - but we still get a great deal on those licenses!). Yeah, overall, I'd say I've been practicing what you are now preaching.

A case in point - IT asked everyone to turn off all devices at night, not just computers. This means monitors, printers, etc. I went a step further and offered, "Employees should use power strips, since we all know that even if your monitor (for example) is turned off, it still draws juice from a standard outlet. Multiply that by all employees (two monitors for many) and over a year, I'll bet that would make a measurable impact." Of course that's a non-issue in my case. I bought mine myself. Well, obviously that idea got laughed at as "a little over the top." I guess I thought that kind of thinking was what really affected the bottom line, but it would seem that me and my friend Warren are in the minority here (I think the above quote is worth repeating):

"Whenever I read about some company undertaking a cost cutting program, I know it's not a company that really knows what costs are about. The really good manager does not wake up in the morning and say 'This is the day I'm going to cut costs,' any more than he wakes up and decides to practice breathing."

- Warren Buffett

OK, my own self pandering asside, there are still plenty of things I can do. For an example that I think will really blow your mind, see my post about the Industrial Revolution of Data about how Google will bring us analytics about our own energy usage through their smart PowerMeter application.

But, for the time being, I should focus on my job, which, if you remember the beginning of this article, is helping business owners learn how to approach their design projects with a cost cutting mentality. That way, when they find that management finally catches up, they know the fad will pass, but good practices will drive the company forward.