How do you explain service cost savings to stakeholders?

1 Identify your stakeholders

The first step is to identify who are your stakeholders and what are their interests and expectations. Stakeholders are anyone who can affect or be affected by your service operations, such as customers, employees, managers, suppliers, regulators, or investors. Different stakeholders may have different perspectives and priorities on service cost savings. For example, customers may care more about the value and reliability of your service, while managers may care more about the budget and performance of your service operations. Therefore, you need to tailor your explanation to each stakeholder group and address their specific concerns and questions.

2 Use relevant metrics

The second step is to use relevant metrics to quantify and communicate your service cost savings. Metrics are measurable indicators that show how well you are achieving your service cost objectives and targets. They can help you demonstrate the impact and value of your service cost savings to stakeholders. However, not all metrics are equally useful or meaningful for different stakeholders. For example, customers may not be interested in the internal cost per unit of service, but they may be interested in the customer satisfaction or retention rate. Therefore, you need to select and present the metrics that are most relevant and understandable for each stakeholder group and align them with their goals and expectations.

3 Explain the methods

The third step is to explain the methods you use to achieve and sustain your service cost savings. Methods are the strategies, tactics, and tools you apply to reduce or avoid service costs without compromising quality or customer satisfaction. They can help you show how you are implementing and improving your service cost optimization practices and processes. However, not all methods are equally clear or convincing for different stakeholders. For example, employees may not be familiar with the technical details or terminology of your service cost optimization methods, but they may be familiar with the benefits or challenges of their implementation. Therefore, you need to explain the methods you use in a simple and concise way for each stakeholder group and highlight their benefits and outcomes.

4 Provide examples

The fourth step is to provide examples to illustrate and support your service cost savings. Examples are specific cases or stories that show how you have achieved or improved your service cost savings in real situations. They can help you make your explanation more concrete and credible for stakeholders. However, not all examples are equally relevant or relatable for different stakeholders. For example, suppliers may not be interested in the examples of how you have reduced your service costs by switching to a different vendor, but they may be interested in the examples of how you have improved your service quality or efficiency by collaborating with them. Therefore, you need to provide examples that are relevant and relatable for each stakeholder group and show how they have contributed to your service cost savings.

5 Address the challenges

The fifth step is to address the challenges you face or anticipate in achieving and maintaining your service cost savings. Challenges are the difficulties, risks, or barriers that may hinder or prevent you from reaching your service cost objectives and targets. They can help you show that you are aware and prepared for the potential issues and uncertainties that may affect your service cost savings. However, not all challenges are equally important or urgent for different stakeholders. For example, regulators may not be concerned about the challenges of aligning your service cost savings with your strategic goals, but they may be concerned about the challenges of complying with the legal or ethical standards of your service operations. Therefore, you need to address the challenges that are important and urgent for each stakeholder group and show how you are overcoming or mitigating them.

6 Invite feedback

The sixth and final step is to invite feedback from your stakeholders on your service cost savings. Feedback is the information, opinions, or suggestions that stakeholders provide to you based on their experience, knowledge, or perspective of your service cost savings. It can help you improve your explanation and your service cost optimization practices and processes. However, not all feedback is equally constructive or actionable for different stakeholders. For example, investors may not be able to provide feedback on the technical aspects or details of your service cost optimization methods, but they may be able to provide feedback on the financial or strategic implications of your service cost savings. Therefore, you need to invite feedback that is constructive and actionable for each stakeholder group and show how you are listening and responding to it.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?