Fewer than half of reported cost programmes hit their target

Of the cost programmes larger ASX-listed companies announced from 2012 to 2023, almost half never reported a result that could be set against their target. Of those that did, 43% met or beat it.

Start with the missing half

The headline is the half that went quiet. A company announces a savings target, often with a number and a date. Two or three years later, the annual report talks about something else.

Some of those programmes worked. Some did not. The record does not say which.

A company is more likely to report a programme that went well. So the 43% may flatter the real rate.

What the reported half shows

Among programmes with a reported result, the median delivered about its target. That sounds fine until you look at the spread. More than half fell short of their target, and some were dropped or had it reset before the end.

A target that moves is the most common way a programme fails quietly. The new number is met, and the old one is never mentioned again.

Why programmes fall short

In our experience the pattern is familiar. The savings are counted when the decision is made, not when the cost leaves the accounts. The work that created the cost is still there, so the cost comes back. Nobody owns the number after the programme team stands down.

The question for your own business

Who decides where costs are cut, and who checks a year later that they stayed cut? The operating model check takes about ten minutes.

The full outcomes are on how often cost-cutting programmes hit their target.