Archive for the ‘Simplicity’ Category

Stop Trying To Be So Clever

Thursday, July 1st, 2010

We spend so much time trying to find clever, sophisticated solutions to our problems that we can miss the simple, obvious ones.

A new dual carriageway is being built close to our village (a remnant of the Labour party’s response to the financial crisis). At various points new bridges are being built over the new road.

What has struck me is how the engineers are putting the bridges into place.

I expected them to build the road and then construct the bridges over the new carriageways, but the builders are doing it in reverse. To lower implementation costs and reduce the risk and impact of mistakes, they are putting the bridges in place and then digging away the ground underneath the bridge to create a cutting for the road to follow.

It reminded me of a story that Rick, one of my clients, told me. Prior to commencing his business career, Rick was a mining engineer in South America, looking for gold. The best place to find gold is in rivers, but getting it out of the water can be very difficult. Various mining companies had therefore invented their own complex machinery that sifted the base materials of the river from the water in the hope of finding gold. The machines and the processes they used were slow and costly.

Rick’s team decided to try a different approach. Using explosives they blew up the course of the river, causing it to divert down a different path, and rejoin the original course further down the stream. This allowed them to walk down the river and pick up the gold quickly and easily.

Business plays to the same rules as gold prospecting in Bolivia and bridge-building in Nottinghamshire. Companies that deliver simple, bold innovations often beat those who have their heads down delivering incremental improvements through increasingly complex solutions.

Where is your effort focused?

© Stuart Cross 2010. All rights reserved.

The Power Of Exploiting Your Constraints

Wednesday, April 21st, 2010

Far from inhibiting business success, constraints enable and accelerate it.

Constraints are the limits and restrictions you place on your organistion and its activities. They are the choices you make about what is in and what is out of scope, including:

  • Where you choose to play. What are the categories, markets, channels and customer groups in which you will participate?
  • How you choose to win. For example, are you focused on leading your chosen markets on product innovation, customer service or price? And where you have made these choices, what performance standards have you set?
  • The resources you will commit and the returns you demand. What are your cash flow requirements, sales and profit growth targets and required returns on capital?

Where these constraints are clear organisations can focus on the work of delivery. Where they are ambiguous, uncertainty grows, people are less sure about what is required of them and performance stalls.

I have identified four specific benefits from establishing business constraints. How many of these would benefit your business?

  1. Faster decision-making. Last year I worked with a client where one constraint that had been set by the company’s owners was that any initiative had to repay its initial investment within two years. This constraint allowed us to quickly identify the highest-potential ideas and avoid spending time assessing too many ideas.
  2. Greater empowerment. Driving down accountability for decisions throughout your organisation increases the speed of decision-making and also frees up your own time for higher value work. However, your team members can only make effective decisions, and be accountable for their results, when they operate within agreed boundaries. Clarifying outcomes, agreeing authority levels and establishing behavioural boundaries all serve to help rather than hinder empowerment and drive individuals’ ownership of results.
  3. Greater creativity. Last week I was working with a management team to generate new growth ideas. The team were struggling to identify compelling new sources of growth and were daunted about the sheer scale of opportunity facing them. It was only when we prioritised three specific areas of opportunity (entering adjacent categories, transforming customer service and targeting a specific customer segment), and put other areas of opportunity to one side, that the ideas started to flow.
  4. Higher returns. Many studies and reports (including Good To Great by Jim Collins, and Profit From The Core by Chris Zook) demonstrate that a focused approach to growth generates superior performance to companies that try to operate on too many fronts. As Steve Jobs once said, “We’re always thinking about new markets we [Apple] could enter, but it’s only by saying no that you can concentrate on the things that are really important”

© Stuart Cross 2010. All rights reserved.

Strategy Execs: Stop Chasing Quick Wins

Tuesday, March 30th, 2010

Click on the link to read my article, Strategy Execs: Stop Chasing Quick Wins, which has just been posted on BNET.

© Stuart Cross 2010. All rights reserved.

5 Ways To Improve Your Performance Reports

Tuesday, March 9th, 2010

Click on the link to read my article, 5 Ways To Pep Up Your Performance Reports, which has just been posted on BNET.

© Stuart Cross 2010. All rights reserved.

Business Lessons From The Latest Failed Airline Bomb Plot

Tuesday, December 29th, 2009

Nothing adds complexity, wastes time and reduces the effectiveness of organisations as much as solving problems by focusing on effect rather than cause.

Take the immediate response to the latest failed terrorist attack. By adding to the number and length of searches carried out on all air passengers, the authorities are merely adding to the workload of security staff, delaying flights and increasing costs for all involved.

It is the equivalent to ‘fixing’ a leaking pipe by placing a series of buckets underneath the leak. It does nothing to fix the hole in the pipe or prevent future leaks from occuring.

Since the atrocities of 9/11 I am not aware of any instances where terrorists were prevented from carrying out an attack on a commercial airline as a result of an airport security check.

I see the same inefficiencies in corporate organisations. For example, I recently worked with an organisation where it took an executive level director over 3 months, and many hours of negotiation, to get his team the smart phones they needed to do their jobs well.

As he haggled with the “Head of Smart Phones” he found out that one or two previous managers had wasted money on unnecessary smart phones in the past. Unfortunately, these actions were then used to prevent anyone else from acquiring these phones.

The best solution for this organisation is not to make it harder for everyone to make good decisions (which focuses on effect), but to change the behaviour of the previous managers and to appoint and develop more capable managers in the first place (which both focus on cause).

Similarly, the solution for airline security is not to impose unnecessary screening on the vast, vast majority of passengers, but to focus the attention of the security services on higher-risk passengers and to prevent those who are suspected of terrorist involvement from boarding the plane in the first place.

The Myth Of Change Management

Monday, December 21st, 2009

Sunrise over mountain streamManagement books talk about the nature and speed of change as if it is some new concept, developed over the past 50 years. Academics and consultants develop models and approaches that seek to help business leaders overcome the difficulties of getting people to accept and respond to change.

Yet people cope with change all the time. Births, deaths, marriages, divorces, new jobs, lost jobs: most people seem to find ways to deal with these situations and still function effectively.

Far from being fearful of change, people, on the whole, are pretty good at it, and the history of mankind is, in many ways, a testament to our species’ ability to handle and adapt to change.

In fact, the term, “change is the only constant” is not from a recent management book, but was first coined by Heraclitus, 2,500 years ago.

Not much has changed since.

The Upside Of Worst-Case Planning

Friday, December 11th, 2009

How would you change your business if your profits were cut by 50% overnight?

I was working with an executive team earlier this week, helping them to create focus and alignment around their agenda for the next 12-18 months. They have a potential problem – which may or may not happen – and so did some work to determine how they could reduce costs if the worst case was to happen.

Despite this organisation being full of busy, efficient and effective people, the exercise helped them discover interesting new ways in which they could more than cover the shortfall.

And here’s the interesting thing: many, if not most of the ideas can be applied to the existing business whether or not the worse case happens.

In other words, by seriously reviewing the implications of a worst-case scenario, this executive team has created alignment and commitment around a few, focused actions that will add 25% to their bottom-line over the next 12 months.

If you were to really question the way your organisation does business, what new opportunities for profit growth could you discover?

© Stuart Cross 2009. All rights reserved.

How To Turn Opinion Into Insight

Thursday, December 3rd, 2009

When I work with my clients I find I can increase the speed and effectiveness of the work by focusing first on the executive team’s opinions. We call these hypotheses or assumptions, but the premise is the same: if we start with an answer we usually get to a better solution faster, even if it is different to the one we started with.

The process I use is summarised in the chart, and I call it the ‘4A Framework’.

The 4A Framework

4a-framework1

The first step is to clearly define the issue at hand, but it is the second step that is critical. Rather than seeking to ‘boil the ocean’ with analysis, you set out your initial view on the alternative solutions, and then, based on your existing knowledge of your business and your markets, take a high-level view of which alternative you believe is best.

This allows you to focus your analysis, increasing the pace and effectiveness of your decision-making.

© Stuart Cross 2009. All rights are reserved.

You Can’t Chase Two Hares

Thursday, November 19th, 2009

istock_hares1There is a Japanese saying that translates, ‘you can’t chase two hares’. If a top-class hunting dog chases after a hare it has a 10% chance of catching it. But if the dog hedges its bets and tries to chase two at once, its success rate is reduced to nil. The dog quickly learns that 10% is the way to go!

How many hares are you currently chasing?

© Stuart Cross 2009. All rights reserved.

Take The Business Tool Fadaholic Test

Tuesday, November 17th, 2009

Click on the link to read my article, Take The Business Tool Fadaholic Test, which has just been posted on BNET.

© Stuart Cross 2009. All rights reserved.