Wednesday, November 03, 2010

Play it again Sam

Sometimes a simple formula can be used again and again to solve many problems.  In change management you could try:

Rationalise ->  Standardise  ->  Consolidate  ->  Simplify  ->  Optimise

This five step strategy can be applied to subjects as diverse as logistics, manufacturing and computer operations.  For some managers this is the core strategy, and it is followed with almost blind faith.  It can produce big cost savings and operational effeciencies, and it nearly always generates large change projects.   Use it, but use it with care, and note the following areas of weakness:
  • Many people fail to grasp the final step requires the creation of a culture of continuous improvment.  Without creating and embedding the "optimise" strategy an organisation can become "locked in" to the ouputs of big change programmes that become static and constraining.  For example - After moving everything into one ERP system, now it is too difficult and expensive to change anything...
  • By building big process, people and technology solutions this strategy can virtually eliminate the creativity and innovation that comes naturally in small responsive business units.  You must create new ways to tap into this spirit, or loose employee engagement and buy-in.
  • This strategy tends to lead to big investments, which may not be right for your organisation.
Above all remember that the world continuously changes and moves on.  By the time you have completed a cycle of this strategy, your business or markets may have changed so much that the outcome is no longer right, and a new start is required.  Slightly sub-optimal but agile may actually be better.

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