If there was a sure way to make the rest of our years the best…
Over my decades of consulting in the field of enterprise optimization, I often heard something like: “We have so much low-hanging fruit to go after we don’t need a computer to tell us how we can improve.”
Fortunately, leaders quickly change their views once they learn the great value of harvesting their ripe and readily accessible high-hanging fruit.
To be the best we can be, we need to do the right things as well as they can be done. This means best-possible planning followed by best-possible execution with resulting best-possible profits. Whatever your circumstances, your company has a field of opportunities comprised of simple and complex ways to improve.
Business management is about planning and execution. It is about discovering the right things to do and about doing those things as well as possible.
Within our fields of opportunities, reside many kinds of simple opportunities that offer advantages independent of big-picture considerations. We also have complex opportunities that call for trade-offs and cause ripple effects as they compete for company resources.
Simple opportunities are not the same as easy, and many complex opportunities can be captured with a quick change in tactics.
Simple opportunities involve single objectives such as lowering costs, improving productivity, reducing waste, and improving quality. Simple opportunities most often relate to better execution. Because doing things better is always the most obvious way to improve, we spend inordinate amounts of time and money on better execution and not enough time questioning and adjusting the things we do.
Complex opportunities are ripe, sweet high-hanging fruit ready for harvest. Complex doesn’t necessarily mean difficult — often major gains can come from minor changes of plans or policies.
Finding and targeting complex opportunities are planning functions aimed at doing the right things in the right amounts at the right times. Complex opportunities dominate our fields of opportunities because they are:
- More plentiful – Because they lie hidden by their own complexities, they remain mostly untapped. We don’t go after what we can’t see.
- More valuable – There is more bottom-line advantage in doing the right things than in doing sub-optimal things better.
Ironically, many if not most complex opportunities are quite easy to capture once they are identified, but they are hard to find among near-infinite viable patterns of activities. Fortunately we can now call on profit-optimization technology to see these opportunities clearly and to systematically turn them into realities.
Some opportunities are much greater and more easily captured than others, and some can be enjoyed quickly at little or no cost. Think of advancement along the curve shown below as climbing an increasingly steep mountain.
Pareto’s familiar 80/20 Rule applies quite well to profit optimization, meaning 80% of our potential gains can be realized by carefully focusing 20% of our time and other resources that would be required for full profit-gap closure.
This isn’t about first going after our low-hanging fruit. Instead, it is about going first for the ripest and sweetest of our low- and high-hanging fruit, be they simple or complex.