• How to Cut Corporate Complexity and Chaos

    by  • November 2, 2015 • Branding, Human Resources, Leadership, Life, Marketing, Strategy • 1 Comment

    chaos-485491_640There are plenty of generic strategic choices to drive a business forward. A host of CEOs strive for scale economies by trying to ‘do more with less,’ usually meaning fewer employees. Optimists favor ‘doing more with more,’ in other words, placing bets that higher sales and profits will pay for increased investments in headcount and technology. These are the strategic approaches  that often add complexity to an organization, and when there is complexity there is chaos.  

    The strategy I’ve grown to love and count on over a 45-year career is do less, better. A long time ago, this ethic saved a near-bankrupt company that I had a part in restructuring. To rise from the ashes, our young management team made several tough sacrifices to transform a multi-product, multi-brand operation from a complex generalist to a focused specialist. Specialists beat generalists – always have, always will.

    Specialists beat generalists – always have, always will.

    This turnaround occurred at Jacobs Suchard’s North American operation, eventually sold to Kraft/Mondelez after many years of profitable growth as a coffee specialist. Like many giants, Kraft/Mondelez has thrived by doing more with less, thanks to several acquisitions and the ensuing power of clout. Expect the same from the Kraft merger with Heinz.

    For companies without clout, competitive advantage can be realized by keeping things simple, by cutting out the complexity cancer that is crippling so many enterprises. The lesson learned from the Jacobs Suchard turnaround was that strategic sacrifice in the right places is the secret to nimbleness, resiliency, clarity and coherence. Strategic sacrifice begins at 30,000 feet with corporate strategy. The principle then travels down through the various functions, and ends at sea level with an individual’s daily “to do list.” This journey isn’t an easy one. People are so entrenched in the do more paradigm that they struggle to kill their darlings, dump all of those exciting initiatives, and sacred cows, and resist adding more features to a product.

    Have the Courage to Kill Your Darlings

    According to Bob Olodort, the product designer of the Ditto notification wearable device, Samsung is snagged in the complexity web. Recently, on VentureBeat.com, Olodort chastised his former client for not sticking to the principles of product simplicity and elegance. Seemingly, continually adding features throughout the development chain is the Samsung culture. Each engineer has a pet feature they’d like included in Samsung phones. Ditto (pardon the pun) the carriers who buy the phones. Olodort says that by time you buy Samsung, you’ve got a phone “crammed with complexity and redundant features.”

    The strategic choice to cut back product features, and curb the insatiable desire to do more and more, must come from the top. To do that, Samsung’s leaders must sacrifice the egos of their engineers. Sure, there will be a fallout. There was fallout when Marissa Mayer killed Yahoo’s popular work-from-home policy. The essence of sacrifice in her mind was giving up something of value for another consideration; when people are together they are more collaborative and innovative.

    For more on strategic sacrifice check out the free introductory chapter of my book Do Less Better: The Power of Strategic Sacrifice in a Complex World.

    Did you like this? Share it:

    About

    Formerlife: Jacobs Suchard CEO (Kraft, Nabob), Strategy Consultant. Afterlife: Palgrave Macmillan Author, Business Blogger, Historical Novelist

    One Response to How to Cut Corporate Complexity and Chaos

    1. December 2, 2015 at 2:28 am

      Great post. Thank you for sharing!

    Leave a Reply

    Your email address will not be published. Required fields are marked *