30 Examples of Companies That Tried To Cut Corners To Save Money But Ended Up Paying More In The End

Even massive household names with billions at stake still find ways to endanger themselves with poor decision-making skills. A tiny little media company called Warner Bros. Discovery decided it needed to try and save $3 billion last year, a pretty tall order even for the most financially responsible of us. So they decided to find a few ways to cut costs. Most famously, they took an already completed film, Batgirl, and canned the whole thing, among other projects. They also removed over 200 episodes of Sesame Street from HBO Max and shut down CNN+. 

The precise savings are unknown, but the uncertainty affected investors since, let's face it, a movie studio deciding to scrap a finished movie is not a move of confidence. This was all done, reportedly, to help Warner Bros. Discovery recoup some money in the form of tax-write-offs. Regardless of the reasoning, investors were wary and the company lost around$20 billion in market cap. This is a fancy way of saying people thought the company's potential value was a cool $20 billion smaller than it was before these decisions.

Now, often enough, the driver behind these decisions seems to be nothing but simple greed. Or at least it can look that way from the outside. Sometimes a company really does need to find ways to make money. Or sometimes an executive really does think they have a brilliant idea. Let's for a moment assume that the higher-ups really thought it was necessary for the company. Wild idea, right? So even in a best-case scenario, why do smart, capable professionals make terrible decisions?

Despite what they might want you to think, executives are still just ‘regular’ humans along with the rest of us. They attach emotions to ideas that possibly don’t deserve them and they see patterns in events that aren’t actually there. Self-interest also skews a lot of data. If we desperately want something to happen, our brains will start to find evidence that supports our plan and ignores information that might limit it.

The simplest solution is to involve another party that can, at the very least, give you an outside perspective. A new person is less likely to have your specific emotional biases. However, a lot of upper management roles are not particularly cooperative. Bosses feel like they need to maintain their authority and will reject ideas from subordinates pretty quickly. Or, even worse, the people they might consult might be other higher-ups who are also pretty interested in saving, at almost any cost.