Programmed for Savings

Meeting Missions: Powering Cost-Avoidance Levers

A US-based technology enterprise faced rising labor spend and needed guidance on lowering costs while maintaining performance and productivity. The company explored workforce reduction but recognized it needed a more sustainable solution that posed less risk to delivery, service levels and business continuity.

After conducting an in-depth analysis, Allegis Global Solutions (AGS) revealed that a disproportionate share of the company’s labor spend was tied to its high-cost headquarters location. The next step was to examine which roles truly needed to be based at headquarters versus those that could be filled in lower-cost hubs or remote settings.

To rapidly identify cost-avoidance levers that could be implemented without disrupting operations, a cross-functional team of market analysts, business analysts and program office leaders came together to identify three objectives:

• Reduce cost per hire through location strategy
• Maintain performance and delivery outcomes
• Create governance that would sustain long-term cost avoidance

Taking Action: Innovative Solutions Inspire Greater Adoption

Confirming that a significant number of roles could feasibly be filled through lower-cost domestic hub locations or fully remote arrangements, the team shared market benchmarks that quantified headquarters-to-hub differentials and supported shifting those roles to new locations. This strategy helped protect delivery and avoid workforce reductions.

To drive adoption, the client implemented a clear but flexible model that encouraged hiring managers to examine the best location for hiring talent. This model balanced flexibility with financial accountability and drove strong hiring-manager compliance.

Suppliers were also supportive of the initiative. With market benchmarks validating the change in hiring tactics, suppliers recognized that rates would align to the new locations, increasing access to a wider range of talent not confined to one location.

Delivering Impact: Hiring System that Supported Success

After a full year of clear governance, accountability for new location hiring mandates and alignment of supplier rate management, the initiative achieved $31.8 million in cost avoidance, prevented layoffs and maintained delivery and service levels. In addition, expanding hiring into lower-cost hubs and remote markets proved repeatable while reducing cost per hire.

Benefits to this model extended beyond cost per hire. The client gained increased transparency and discipline in hiring decisions, increased US starts by 12% while reducing max rate variance by 9% – supported by a 93% compliance threshold policy – and continued shifting the location mix to lower-cost markets, enabling more flexible on-site requirements.

The successful implementation of this model proved to be a future-focused strategy with measurable outcomes and true cost avoidance for the client.