Conquering Complexity in Your Business

Conquering Complexity in Your Business

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George, Michael L. | Wilson, Steven A. McGraw-Hill, 2004
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IN THIS SUMMARY

According to George and Wilson, when companies rely solely on Lean and/or Six Sigma improvement initiatives, the amount of profit they are able to generate is severely limited. It is a ceiling on profit that comes from complexity — “an entirely separate dimension to operating improvements that often presents the single largest opportunity for cost reduction and the most significant hurdle to profitability growth in most companies.” This complexity, characterized by more product offerings than customers want, more services than markets can support, and too many ways of processing the same output, generates huge nonvalue-added costs that customers are unwilling to bear. These costs, which are concealed in overhead, represent a hidden pool of profit and growth with huge potential. Conquering Complexity in Your Business is offered to CEOs and senior executives (in financial and professional services organizations as well as those in manufacturing) who know their companies suffer from this malady, know that it is a big problem, but do not know how to resolve it effectively. Thus, with the goal of enabling companies to improve significantly in their ability to grow profit, revenue, and shareholder value, this book provides tools for: identifying complexity in a company’s offerings and processes, quantifying complexity’s impact, determining what complexity needs to be kept and exploited and what should be eliminated, and selecting the right approaches for doing both. Thus, the authors bring much needed rigor to the analysis of complexity, providing companies with a well-defined, systematic method for precisely measuring, managing, and profiting from it. This method supplements and informs business judgment, thus, making the conquest of complexity, and the resultant benefits, available to all competent executive-level managers, company leaders, board members, and anyone with responsibility for shareholder value. This accessibility allows them to explain precisely why particular projects have been chosen, what these projects are selected to accomplish, and to gain important competitive insights that go beyond complexity.