A veteran company executive with decades of experience in operational and financial management, Denny Weinberg is the CEO of the digital health technology company, Hixme.com. An experienced corporate advisor and turnaround strategist, Denny Weinberg previously helped steer a number of WellPoint Companies through a highly publicized turnaround from near insolvency to profit leadership through cost, process and market restructuring.
In typical tough business environments where depressed sales often challenge bottom lines, cost restructuring is one important way organizations can regain profitable. Cost and process restructuring encompasses the measures taken by a company to reduce expenses, restructure processes and redefine even the most basic functions so as to improve profitability. It may take various forms, such as downsizing fixed expenses, reducing recurring commitments such as levels of management, identifying functions no longer relevant and debt restructuring.
Well-designed cost-restructuring measures focus on eliminating lower-value activities without severely impacting overall value,and often aligning support activities more closely with the revenues and customers who depend upon them . While many times companies authorize cost-cutting measures to salvage their earnings, quick-fix prescriptions like reducing head count and throwing away annual bonuses have a place for short term challenges, but can be counter-productive if they replace true re-engineering in the longer term.
An analysis of a company’s market, technology and cost position and the possible outcomes of different scenarios often precedes any significant cost-restructuring program. When company restructuring is necessary, exiting a low-growth, high burn market may produce a better outcome in the appropriate term than reducing employee benefits, for example.