Have you ever heard the phrases:
“Keep it simple and stupid.”
“Less is More”
This type of advice, which seems rather basic and powerful, is really of not much use at all. Not that simplicity isn’t a virtue… It very clearly is. It is just that implementing it is a very tricky proposition, for one very simple reason: simple with respect to what?
When dealing with management, simplicity can refer to many things: KPI, structure, hierarchy, products, communication, and just about everything else. However I often find that complexity is unavoidable. I also very, very often find excessively complex systems that can greatly simplified.
One of the best ways to do this is to define a single criterion for simplification: Let’s consider the following engineering example:
In a robotics lab, the chief engineer reviews the drawings of one of his designers. The design seems sound, but as it is designed, the product will be costly, confusing to operate, and difficult to service. The head engineer thinks about for a while then orders his designer to reduce weight by 30%. The designer doesn’t understand, claims his design is good, and besides, reducing the weight is impossible. His boss maintains his challenge, without expressing any of the 3 problems he had identified. The designer grudging set about to re-think his design with the imposed weight target. A few weeks later, he marched in to the chief’s office, with a new design, again stating that the weight target was impossible. He managed a 15% weight gain with a completely new approach, and it was the best possible design. The designer went on ranting and raving about his new design, defending every detail and concluding that the boss was just plain unrealistic. The said boss listened to the entire thing, smiled, and gave the order for production. Indeed the new design wasn’t much lighter, but the issues concerning the initial design (confusing, costly, and servicing) were solved. The new design was simpler, and had to be so to meet the weight challenge, and this simplicity made its operation clearer, production easier, and servicing more accessible. The key was to find the proper metric to spawn the improvement.
If the chief engineer had mentioned his real issues, the solutions encountered would have been more complex and less satisfactory than the one finally found because the designers would be trying to optimize 3 different aspects instead of just one.
When dealing with a business, a its multitudinous interconnected processes, the problem is a great deal more complex. The use of ERP and automation has further added complexity by putting new constraints on the system.
Another thing to understand is that simplicity takes MORE planning and thinking, not less.
Going for a normal company organization to a more natural one, with a simple organization, with clear responsibilities, and understandable products is a process requiring strong management determination, and a great deal of creativity.
Just like the engineer improved his design in the story by concentrating on lowering the weight, the best way to go about designing a business is to worry about a single thing: creation of value. Creation of value is not about maximizing profits or worth on the stock market. It is about finding that sweet spot where the people are willing, creative, and incentivized, where the finances are at equilibrium and sound, where technology is being generated and used appropriately.