Conquering Complexity in Your Business

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Content: Terms of Use Want to learn more? Contents About the Authors Acknowledgements Preface PART I Complexity: The Silent Killer of Profits and Growth Chapter 1 The Overwhelming Case for Conquering Complexity A Tale of Two Companies The Three Rules of Complexity Complexity Rule #1: Eliminate complexity that customers will not pay for Case #1: The story of Southwest Airlines vs. American Airlines Complexity Rule #2: Exploit the complexity customers will pay for Case #2: Capital One vs. MBNA, Bank of America, et al. Complexity Rule #3: Minimize the costs of the complexity you offer. Case #3: The real secret of ToyotaCase #4: Experience bought, not taught Finding the Right Combination of External and Internal Complexity The Complexity Value Proposition Conclusion: The competitive advantage of conquering complexity Chapter 2 Exposing the Silent Killer: How (and how much) complexity drains time and resources in your business How Complexity Silently Kills Profits and Drains Resources Process Cycle Efficiency: The foundation for quantifying complexity Quantifying What Affects PCE: The Complexity Equation How Variation in Mix Destroys PCE and Profit. What Lever to Pull?: Advice on improving PCEThe Power of Numbers Conclusion Chapter 3 How Complexity Slows the Flow of Critical Information Information Flow Complexity = Too Long to Reach Decision Makers Complexity Creates Noise in Information Systems Dell and Compaq: Better to be fast than first How Does Dell Achieve Fast Information Flow? Conclusion: Cumulative effect of complexity on strategic decision making Chapter 4 How Conquering Complexity Drives Shareholder Value The Challenges of Accounting for Complexity. Making Decisions That Benefit Shareholders: Earnings Per Share vs. Economic ProfitKey Lessons About EP and Growth The Complexity Imperative in Fast Markets The Links between Complexity and Value Conclusion Chapter 5 Complexity as a Strategic Weapon Six Precepts For Strategic Use of Complexity Precept #1: Customers define value Precept #2: The biggest gains from conquering complexity come from step-change improvements Precept #3: Focus on what matters most-100% of your value creation probably resides in only 20% to 50% of your offerings. Precept #4: Think value share instead of market sharePrecept #5: Growth results from value-driven application of finite resources Precept #6: First eliminate offerings that can never generate positive Economic Profit, then attack internal complexity ALDI International: A case study in strategic complexity Eating Away the Competition ALDI's Secret of Success: Eternal watch against complexity Conclusion (and a look ahead) PART II Complexity Analysis: Quantifying and Prioritizing Your Complexity Opportunities Executive Overview of Complexity Analysis.