Written by Lyudmila Chicherova
In the first half of 2023, as corporate bankruptcies increased in the United States, companies across all sectors began actively seeking ways to optimise costs. However, in many cases, cutting expenses closes off opportunities for further development. Elena Makushina, a respected economist, an expert in business management, and winner of the prestigious international Expert of the Year award, has developed a proprietary cost-optimisation methodology that enables businesses to eliminate truly unnecessary expenses while significantly improving financial performance.
Identifying duplicate costs
One of the core pillars of Elena Makushina’s methodology is identifying duplicate expenditures - such as subscriptions to services with overlapping functionality or the same services being procured independently by different departments. According to the expert, the larger the organisation, the more likely it is to incur such costs. Eliminating them has no impact on day-to-day operations, yet can deliver significant savings. To identify these inefficiencies, Elena Makushina recommends using modern digital technologies that increase transparency across business processes.
“For example, financial monitoring systems or ERP platforms can be configured with algorithms that automatically flag recurring or duplicate payments,” the expert explains.
Six strategies and the Pareto principle
Elena Makushina proposes six strategic approaches to cost optimisation: elimination, substitution, process optimisation, outsourcing and outstaffing, automation and digitalisation, as well as the renegotiation of supplier contracts. While these are widely recognised principles of cost management, financial analysis, and managerial accounting, their combination, structure, and sequence of application reflect Makushina’s proprietary methodology.
“I adapted classical frameworks to the real-world practices of companies across different industries by adding checklists, control questions, and examples of common mistakes - turning theoretical models into practical tools for everyday business use,” Elena Makushina notes.
The expert also emphasises the importance of the Pareto principle, commonly known as the 80/20 rule. In cost management, this approach suggests that the greatest impact comes from optimising the 20% of expense categories that account for roughly 80% of a company’s budget. Even a reduction in just one of these major cost areas can deliver immediate and substantial savings.
HoReCa as a largely unexplored field in economic research
Elena Makushina’s methodology is universal and can be applied across industries - from manufacturing to retail and e-commerce. Most importantly, however, it is particularly well suited to the service sector. Despite the rapid growth of HoReCa, there remains a significant gap in global economic research on the management of businesses in this field.
Elena Makushina explains the historical focus of academic research on manufacturing by noting that costs in the production sector are easier to quantify and analyse.
“The service sector remained underexplored for a long time due to its specific characteristics: a high share of labour and managerial costs, dependence on service quality, and the difficulty of directly measuring outcomes,” the expert notes. Today, this has changed, with transparent digital tools making it possible to measure what was previously difficult or impossible to track.
Elena Makushina herself has extensive hands-on experience in cost optimisation for Hilton and Marriott hotels in Russia. This practical background allows her to understand how to build efficient financial processes and eliminate systemic losses without compromising service standards.
Systematic thinking and practical application
“When developing the methodology, I was guided by the principles of systematic thinking, practical applicability, and a focus on real results,” says Elena Makushina. She is currently working on a methodology handbook on cost optimisation, presenting her proprietary approaches in clear language accessible to a broad professional audience.
“It is important to me that the methodology can be used not only by accountants, but also by business owners who want to understand the logic behind the numbers and make well-grounded management decisions,” Makushina emphasises.
In her methodology handbook, the expert examines the entire chain of a company’s financial processes - from management and accounting reporting to day-to-day business operations. This approach helps identify the most critical areas for potential optimisation rather than focusing solely on individual expense categories.
Makushina admits that one of the most challenging tasks in developing the methodology handbook was consolidating various cost-optimisation strategies and principles while preserving analytical depth.
“On the one hand, the methodology must remain universal so that it can be applied in companies of different sizes. On the other hand, excessive simplification would quickly turn cost optimisation into a formal exercise that delivers no real impact. I had to clearly define the boundaries - where the methodology works as a system and where individual adaptation to a company’s business model is required,” she explains.
Although work on the methodology handbook is still ongoing, it is already clear that it will not be a manual on cost cutting, but rather a framework designed to help companies structure and understand their entire financial ecosystem.
“It is meant to help decision-makers evaluate which budget items can realistically be reduced, where control is being lost, and which actions will deliver sustainable results in the near future - not just one-off savings,” Makushina adds.
Elena Makushina plans to publish the methodology handbook as a book so that her proprietary methodology can be implemented by companies across the country.
