Ballav Mundra, CFO, Hexagon Capability Center India, decodes the art of cost management in service delivery, the role of data analytics, and cost-saving measures from the CXO’s perspective. Having worked in various organizations across different roles, Ballav is a professional chartered accountant and management graduate with over 24+ years of experience in finance, controllership, outsourcing, business transformation, operations, and service delivery.

How do you approach cost management in service delivery while ensuring that customer satisfaction and service quality are maintained at a high level?

Cost optimization is a core strategic responsibility for any CFO. This is not about slashing budgets but it’s about smart allocation, operational discipline, and identifying/creating levers for efficiency without compromising on value delivered to clients. We have to move from cost-cutting to cost shaping i.e. from reactive to proactive whereby every rupee spent contributes to enhanced delivery capability or client experience. Further, explore opportunities to optimize the organizational pyramid (hierarchy) structure without diluting expertise – maintaining the right skill mix along with continuously observing cost to the delivery pyramid. Continued focus on leveraging automation & reusability to reduce duplication efforts across projects. Effective collaboration with delivery teams to identify areas where cost-cutting affects quality—and to avoid those. Instead, double down on cost efficiencies that don’t touch quality. Institutionalize project-level margin tracking and early warning signals for SLA risks or scope creep.

CFO’s role today is to make cost, a lever for competitive advantage—not just control. That means enabling delivery to do more with less, while the customer sees more value, not less service.

What strategies have you implemented to optimize operational costs without affecting the scalability of services, especially during periods of rapid growth?

Optimizing operational costs during growth is like changing the tires while the car is speeding. My approach has been to create scalable cost structures, automate intelligently, and align spending with business velocity—not just headcount. A few strategies that we considered were as below :

Variable Cost Models in Delivery whereby fixed costs were restructured into more variable, scalable models as possible – pay as you use by using cloud platforms, on-demand stretch workforce, etc.

Shared Services & Centralization by consolidating support functions, especially in Finance ops, Procurement, HR support, etc which enabled reduce duplication, eliminate redundancies, drive implication/automation.

Automating at Scale by investing early in automating tools, standardization, and workflow tools to reduce manual effort across functions—especially during scale-up.

Agile Resource Planning and Just-in-Time Hiring by using rolling forecasts tied to pipeline velocity to drive just-in-time hiring rather than speculative bench buildup.

Optimizing Real Estate Footprint by embracing hybrid working models, flexible seating & restructuring our leases during our post-COVID scale-up, which led to a significant reduction in real estate cost per employee.

Vendor Consolidation by identification of opportunities across multiple locations and services thereby reducing our spend without affecting productivity.

Scalability and cost efficiency aren’t opposites—they’re interconnected. My role as CFO is to build flexible cost structures that scale with business momentum, not against it.

Also Read: CFO - A Remarkable Professional Partner Boosting the Business Beyond Financial Metrics

In your experience, what role does data analytics play in identifying areas where cost efficiencies can be realized in the service delivery process?

Data analytics has transformed how we identify cost inefficiencies—not just by highlighting what’s happening, but by explaining why, predicting what’s next, and guiding where we need to act. In our experience, data analytics helped to pinpoint cost drivers with granularity - drill down into cost elements—per client, per project, per resource—giving us visibility that traditional reports can’t. We were able to forecast resource utilization gaps by monitoring utilization patterns, idle time, and shadow resources. Data analytics also helped in the identification of scope creep and change request leakage through analysis of trend deviations, time logs, and effort variance to flag off unbilled work and margin engagementṣ. Another important area was optimizing the Onsite-Offshore mix by using engagement-level analytics to model optimal delivery ratios—onsite vs. offshore, senior vs. junior—based on complexity and SLA adherence. The last example will be predictive modeling for bench & hiring – by integrating sales pipeline and delivery data to predict skill demand 3–6 months ahead, avoiding both over-hiring and project delays.

How do you ensure that cost-saving measures are sustainable in the long term and not just short-term fixes that could impact the company's growth?

To ensure that cost-saving measures are sustainable, my focus is on structural changes, not surface-level cuts. The goal is to make cost efficiency a part of the operating model—not just a response to quarterly pressure. Some of the key approaches were:

Anchoring cost-saving measures to Strategic goals – We aligned every major cost decision with long-term strategic objectives, be it customer experience, platform modernization, geographic expansion, or productivity enhancement.

Focussing on Efficiency levers, Not just expense cuts – This was done by distinguishing between good costs (innovation, talent, automation) and avoidable costs (manual processes, vendor overlap, wastage).

Embedding cost governance into Business processes - Sustainable savings come from process-level redesigns, not just finance-led mandates, and hence embedded cost efficiency into how delivery, procurement, and admin functions operate day in and day out.

Tracking total cost of ownership (TCO), Not just opex – by using this model, we ensured that we are not saving Rs. 1 today and spending Rs. 2 in the long run overall.

Monitoring & course correction with feedback looping – We did not treat cost actions as ‘set-and-forget.’ We tracked KPIs like service quality, NPS, and employee churn to ensure savings aren’t eroding long-term value.

Short-term cost wins can become long-term liabilities if they undermine growth enablers. As CFO, it’s my role to ensure every saving strengthens—not weakens—our ability to scale, serve, and stay competitive.

Can you share an example where a strategic financial decision significantly improved cost efficiency in service delivery within your organization?

One strategic financial decision that significantly improved cost efficiency in our service delivery was redesigning our global delivery model by shifting from a high-cost, location-centric structure to a skill-based, distributed delivery framework. We noticed increasing delivery costs and margin pressures in key projects, especially those with high onsite staffing and legacy support components. Even if revenues were growing, the cost per dollar delivered was rising disproportionately—threatening profitability.

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First as a CFO and then also while leading transformational initiatives, we led a cross-functional initiative with Delivery and HR to:

• Restructure the onsite-offshore mix based on role criticality, not only customer preferences

• Move from a location-based costing model to a role-and-skill-based costing model, in certain cases.

• Use data analytics to forecast resource needs based on actual utilization and project complexity.

Implementation Highlights:

• Negotiated blended rate contracts with clients to enable flexibility in resource mix.

• Transitioned repetitive support roles from onshore to offshore centers in India

• Built an internal talent mobility dashboard to identify ready-to-deploy skills across business sub-units, reducing the time and cost of new hires.

Outcome

• Achieved reduction in delivery cost per engagement over the next period.

• Improved gross margins in the targeted portfolio.

• Clients saw minimal or no drop in service quality—in certain situations, our delivery timelines improved due to better skill alignment and offshore productivity.