Why Too Many Products, Markets & Customers Are Crippling Your Company—And
What You Can Do About It
By John L. Mariotti
John Mariotti's classic books are now in print and available to complement THE COMPLEXITY CRISIS in your library.
You can now get new copies of John's first two books. One was called by Tom Peters "... the best book on partnering...." THE POWER OF PARTNERSHIPS--The Next Step Beyond TQM, Reengineering, and Lean Production. The other was an Award Winner on strategy and marketing: THE SHAPE SHIFTERS--Continuous Change for Competitive Advantage both at Amazon.com or at Barnes & Noble on-line. )
"THE COMPLEXITY CRISIS" was chosen as one of 2008's Best Business Books by Soundview Executive Book Summaries, and was the feature book in its March 2008 Summaries.
Read the latest reviews of THE COMPLEXITY CRISIS on SmallBizTrends.com and on amazon.com.
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Investors Business Daily and Yahoo News features Mariotti's new book
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The Problem: Where have all the profits gone?
Businesses must compete in more complex markets than ever before.
Companies are seeking growth at double-digit rates in markets that
are growing at single-digit rates, or not at all. This quest for
growth has led to runaway complexity and proliferation in products,
customers, markets, suppliers, services, locations and more. All
of these add costs, which go untracked by the best of modern cost
systems. All of these fragment management focus, waste time and
money and reduce shareholder value. And all of this goes on under
the radar of management or board attention. The Complexity Crisis
is arguably the most insidious profit drain in modern business.
The Challenge: What can we do about it?
First, recognize that rampant proliferation adds to costs in a manner
that goes untracked. Then track it down. Where it adds value, alter
processes to accommodate it. Where it doesn't, which is most places,
stop it. Reduce or eliminate it. And institute safeguards—systems
and metrics—to prevent its unnoticed return. Most of all, find quick
and easy ways to describe The Complexity Crisis so it is recognized
as a potential profit drain, and managed like the critical business
consideration it has become.
The Premise: What Gets Measured, Gets Managed.
To understand the success factors in business is critical. To understand
the obstacles that get in the way is equally important. This is the
purpose, indeed, the job of management. The tools used that allow management
to do this job are metrics and then the actions that result when the
metrics expose an area for management attention. The good news—many
of the necessary tools already exist, and may be in use. The bad news—complexity
is, by its very nature—"complex" and thus it defies many existing measurement
techniques.
The Approach: Find it; Fix it; "Use It or Lose It"
(and Keep It Simple)
First, recognize what constitutes complexity and the hidden costs it
creates; the places it siphons off profit into blind alleys and hidden
corners of the business. Next, find it in your business and decide if
it creates or destroys value for customers. Then, decide to either " Use
It"—change structure and processes to accommodate value-added complexity
for competitive advantage, or "Lose It" and reduce or eliminate
non-value added complexity wherever it has crept into your business.
Finally, institute new metrics and modifications to existing cost and
management control systems to choose when to keep it out, and when to
capitalize on complexity. Last, and most important: Keep the management
of The Complexity Crisis as SIMPLE as possible, so whether you "use
it or lose it" you solve the problem and keep it solved.
The Author:
Experienced executive—15 years—President, Huffy Bicycles
& Rubbermaid Office Product Group
Accomplished author—8 books and hundreds of columns/articles in leading
publications, web sites
Director on six corporate boards, and an advisor to several others
Consultant & keynote speaker: Titleist, Colgate Scotts, Southern Co.,
Emerson, Deere, etc.
Guest lecturer for several major universities business schools
Contributor, Business—the Ultimate Resource, Encyclopedia of Health
Care Management
M. S., M. E. University of Wisconsin, B. S. M. E. Bradley University