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5 minute chat with Tomáš Krýsl

Interview with Tomáš Krýsl, Partner, Expense Reduction Analysts.

The name Expense Reduction Analysts is pretty self-explanatory. Nevertheless could you tell us what is it you do exactly?

We generally work with CFO’s and CEO’s of medium and large companies who wonder if they could be leaving money on the table across their supplier base in non-strategic costs, and if they are, they want to know how much, where, and how to get that cash back to work in their business.

Would not a CEO of a medium size company have a team of people who would be taking care of suppliers and non-strategic costs?

Sure, they would. However most executives know there are fundamental limitations to what procurement groups can do internally, but they don’t have time or resources to help them beyond those limitations.

What kind of limitations do you have in mind?

The negotiation leverage of and internal team is limited to their own purchases only. They are not able to aggregate the volumes. They also typically lack the benchmark data of the relevant supplier industry, because they cannot compare the prices their supplier would offer to their competitors or their options are very limited in this respect. Moreover when there is a cost saving project in a specific area and some measures are implemented it has typically only a short term effect. Clever suppliers know how to get back the profit they would give up in order to win the deal.  It takes “insider knowledge” of the suppliers industries to make sure that it would not happen and the savings will be reached.

It seems like you would be playing an extension of the internal teams?

Exactly! We do work as an extended arm of the internal procurement teams of our clients. We do not substitute their functions, we help them to break through of their internal limitations. Often we can also bring an outsider view and help the team to find an out-of-box solution in specific cost area. After the measures are implemented we monitor not only the suppliers but also the internal buying behavior to make sure that the savings are realized in the long run.

If I would be a busy CEO trying to fulfill the production targets I would be afraid that a cooperation with you would take much of my time or the time of my teams. How time-consuming is your services for a client?

Thanks to a thorough insider knowledge of relevant cost industries it does not take much time to our specialists to discover all necessary details of the actual cost area. Typically we spend about 3 hours at the beginning of a project with the internal stake-holders and then our cost specialist work autonomously. The insider team then can focus on strategic projects.

Interesting, you bring your clients improvements in specific cost areas and also save on their time.

Absolutely. They can focus on building up what they do the best – their core business and we bring the knowledge and our time to find the most suitable solution for their cost base. What we save on costs it improves directly their balance sheet. So they win twice.