When it comes to cutting corporate expenses, one of the first places the savvy budget analyst will look is the infrastructure of the company. Is there anything that can be cut from the program? Are there any positions that are unnecessary? Essentially, the analysts come in and make sure the business is running at its full capacity and is using as few resources as possible. In business, efficiency is absolutely essential to success.
In the drive to efficiency, however, experts and advisors can often do damage while trying to streamline a business. The impact may be of a nonspecific, qualitative kind, or may present itself in a very real and immediately damaging way. As an example, downsizing staff or eliminating production workers may be a tempting cost-cutting measure, but the remaining workload will have to be distributed among the remaining employees. Creating redundancies based on truly inefficient job descriptions can be beneficial to a company, but if the lack of staff places a new and difficult burden on the remaining staff, the overall effect of the cost-saving measure will be a lack of productivity. There may also prove to be a chilling effect on the remaining staff, creating a drag on morale and team spirit and dynamic. This less specific or quantifiable effect should always be part of a downsizing calculation.
