The most effective programs achieve both cost reduction and resilience,” says David.
For Matthias, resilience starts with knowledge rather than contingency planning alone.“ The cost-reduction strategy has to be built on actual knowledge, technical and supply-chain knowledge, of what good looks like,” he says.“ You need an end-to-end understanding, not just of your supplier, but of what their suppliers look like too.” That knowledge is what allows a business to absorb a shock without losing control of the number.“ You can say: this will no longer cost me US $ 1.10, I have to accept US $ 1.15, and that’ s how far it can go,” he explains.“ It’ s not only cost reduction, it’ s cost mitigation.”