Direct and Cost-Avoidance Savings Solution
Over the past few years, one of Allegis Global
Solutions’ (AGS) clients, a leader in the construction
machinery and equipment industry, tasked us with
helping them realize aggressive cost savings goals.
Starting with a $6 million goal in 2012, their target
goals climbed substantially to $10.8 million and $10.7
million in 2013 and 2014 given global economic
conditions were directly impacting their inventory.
As such, AGS needed a way to calculate cost
savings, beginning from when the managed services
program (MSP) went live to its current state, in order
to determine how to sustain cost savings throughout
the life of the program.
By working closely with our client, AGS was able to
develop five methods for controlling costs. From
there, each savings methodology was classified as
either a direct savings initiative or a cost avoidance one.
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