Problem Solving And Prioritization - Expense Reduction

Sometimes we are faced with a problem which is quantitative in nature. It could be (but not necessarily only) in the form of having to reduce expenses. Let's take an example.

Assume we are forced to reduce our expenses because ... (well whatever the reason).

And let's assume that our top two major expenses heads are:

Expense Head          Expense Per         No. of Occurrences      Total Expense

                             Occurrence               Per Month               Per Month

---------------------------------------------------------------------------------------------

A                                100                        20                         2000

B                                 800                         1                          800

and let's assume all other expenses (Expense Head "C") are about 200 per month and the total expense is hence 2000+800+200 = 3000 per month.

Now, let's say we are in an unfortunate situation of having to reduce the expenses substantially. The initial feeling most of us have is "Oh No, I can't reduce A, its absolutely essential. And B uhhh uhhhh. No not that either." 

The interesting thing about this kind of a problem is:

1. We face a situation where expense has to be reduced. Substantially. And immediately.
2. The idea of reducing A and B is appalling to us. And we haven't a clue how to go about doing it. We know it is possible but it's very painful to even contemplate doing it.
3. We are not confident of our ability to solve the problem

The question is: How do we go about doing it? :)

The idea of expanding income as an alternative is out of scope here. Please remember that while the problem might seem theoretical, it is not. This kind of a problem happens frequently in life.

I think it's obvious that addressing C won't solve our problem. How should we go about solving this?. Why?

Comments welcome (I don't publish comments).