Focus

Less Is More: How Great Companies Improve Productivity Without Layoffs
by Jason Jennings

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Think about how Kmart ended up in bankruptcy court because of its inability to focus on a simple BIG objective. One day, former CEO Charles Conaway directs his company to underprice Wal-Mart on thirty thousand staple items, even though Wal-Mart can't be bested in that category. When that doesn't work, he proudly proclaims his store to be "the authority for moms, home and kids," and proceeds to enlist the edgy Spike Lee to direct Kmart's next advertising campaign. Duh! Any organization that complicates things with too many man-made issues will eventually lack clarity of purpose.

We knew our observation that companies begin their journey to productivity with an across-the-board adoption of a simple BIG objective was significant. But it turned out an even larger lesson awaited.

Once a company's people have successfully developed and demonstrated their ability to master a simple BIG objective, it appears that their new skill set allows them to begin focusing on other BIG objectives as well. Yet there's an important caveat here. People can successfully focus on two or more objectives just as effectively as when they are focusing on only one, provided the new BIG objective or objectives are layered on or build upon the initial objective.

For example, once Lantech had mastered the art of productivity on the factory floor, they discovered it took the company a full week to enter an order for a machine they were able to build in just eleven hours. By focusing on order entry while maintaining productivity on the factory floor, they were able to reduce entry time to minutes. Next, they realized that even with a score of accountants they weren't getting a monthly financial statement until the twenty-fifth of the following month. That became an additional focus. According to CFO Jean Cunningham, the financial statement is now ready on the first day of the month, produced by an accounting staff one-third its previous size.

At SRC, once Jack Stack had taught everyone the basics of business, it was a natural progression to begin making the company more productive through the improvement of every line on the financial statement. As Stack says, "In twenty years we've had more than twenty different bonus programs, each based on what we needed to be doing to become more efficient and profitable." But he cautions, "We've only been able to have all those different bonus programs because everyone understands business."

Soon after Bill Zollars's proclamation that Yellow would no longer be a freight company but a service business, it became obvious, he says, that his lily-white, male-dominated company needed to diversify, and that became another objective to focus upon.

As long as additional objectives are understood by everyone as complementing or adding to the original simple BIG objective, the workplace won't become confused by mixed messages and signals.

Where Does It Come From?

How do leaders and managers go about developing a simple BIG objective that will allow them to focus the efforts of everyone in their store, department, division or company?

In all the companies we studied, the objective was born from a defining moment in the life of the person leading the effort. The same thing applies whether the leader is the CEO transforming her company, the production manager transforming the factory floor, the sales manager building a new team or the small business owner resurrecting a retail store. The simple BIG objective never comes from accounting, human resources or a centralized department of strategic planning, and it has nothing to do with the current quarter's profit numbers or the CEO's current hot button.

Pat Lancaster's defining moment came the day he lost his battle for patent protection before the Supreme Court. He could have sold the company, cashed in his chips and spent the rest of his years chasing the sun. Instead he chose to create the world's most productive factory.

Jack Stack's defining moment came with the sudden realization that with an 89 to 1 debt-to-capital ratio, there was only a slim chance his company would exist for long. He chose to teach everyone business.

The death knells were ringing for Yellow Freight when Bill Zollars stepped to the plate and said, "This company is going to be rebuilt on the kinds of customer service attitudes that made Starbucks so great."

All the companies we studied began their journey into productivity by adopting a simple BIG objective. It doesn't seem to matter what it is . . . only that one exists, that it's authentic, and that it fundamentally impacts the way business is done. Sun Microsystems CEO Scott McNeely says it this way: "If you put enough wood behind the arrow, it will hit the target."

So what's the defining moment that's going to allow you to develop a simple BIG objective to serve as the strategy for driving your business, division or company to become more productive? And once you have it, how will you move it through the organization and have everyone believe and rally behind the quest for building a more productive enterprise? Read on.

Copyright © November 2002, Portfolio Books, a member of Penguin Putnam, Inc., used by permission.

About the Author

Jason Jennings has spent more than twenty years teaching businesspeople how to build great organizations. He gives more than sixty keynote speeches every year and is the author of two previous business bestsellers: Less Is More and It's Not the Big That Eat the Small, It's the Fast that Eat the Slow. He lives near San Francisco.