The government confirmed last week that the UK Space Agency will no longer operate as an independent body, and instead will be brought under the Department for Science, Innovation and Technology. One of the main drivers for this move is cost-saving.

Of course, most of us aren’t running space agencies — but the underlying lesson applies to organisations of every size: from time to time, it’s worth questioning whether each part of the business is still delivering real value.

Balancing costs and returns
Certain departments or services within a business can be costly to maintain without producing a sufficient return. This might be due to reduced demand, or simply because the expenses involved — staff, premises, stock and administration — outweigh the benefits.

Take the example of a café: perhaps a complicated dish on the menu is rarely ordered, yet it ties up staff time, storage and ingredients. By removing it, the café can concentrate on quicker, more profitable options.

Avoiding overlap
As companies expand, duplication of effort often creeps in. Two teams might end up doing near-identical tasks, or two products could be competing for the same customer base. Streamlining these areas frees up time and resources to focus on the most profitable activities.

Keeping strategy aligned
Just because something has always been part of the business doesn’t mean it supports your future direction. You may find your organisation is gradually specialising in one type of service or client. In that case, retiring areas that no longer fit could make sense.

Better oversight
Sometimes the problem isn’t cost or duplication but control. Centralising certain functions can improve accountability, decision-making and efficiency, without necessarily removing them completely.

Practical steps you could take include:

  • Reviewing profit margins by product, service line or department on a regular basis.

  • Watching out for hidden costs such as administration, storage or staff hours.

  • Asking whether a service or product still fits with your long-term goals.

  • Considering whether parts of the work could be managed more efficiently elsewhere.

Deciding to close a department or service is never easy — particularly if it has history or loyal customers. But as the government’s decision on the Space Agency illustrates, sometimes it’s the right choice to save money, maintain focus and ensure resources are used where they matter most.

If you’d like support reviewing your business strategy or creating a system to track performance, please get in touch — we’d be delighted to help.