RKL eSolutionsBlogs

Focus is the Key for Companies to Make More Money

A recent magazine article appearing in Fast Company magazine ("Lessons For 2013." Fast Company Dec. 2012: 88+. Print.) gathers up bits of advice from across many industries. Here’s one.

“You can survive any type of distraction if—and only if—you stay focused on the organization’s mission.” – Doug Ulman, Livestrong

 

Focus is Everything!

If a for-profit company is focused on anything other than making more money tomorrow than it is making today, whatever the company is focused upon is a distraction.

Yes! We need to have top quality products and services.

Yes! We need to have outstanding customer service.

Yes! We need to have happy and productive employees.

Yes! We need to have an agile, resilient, robust (add adjectives to your heart’s content) supply chain.

All of those may be true—and probably are true.

But, we need to spend our precious time, energy and money on the things that are keeping us from making more money tomorrow than we are making today.

If, after careful consideration, we determine that the thing that’s keeping us from making more money is poor quality products or services, then we should spend our money on improving products and services. We should continue to do so until quality is no longer the thing that is keeping us from making more money.

On the other hand, if our careful consideration tells us that the lack of agility in our supply chain is what is keeping us from making more money, then we should spend our limited resources of time, energy and money on supply chain agility. And, again, continue to do so until supply chain agility is no longer the factor keeping us from making more money.

Stated in the negative: if, by way of example, the quality of our products or services is not the thing keeping us from making more money, but supply chain agility, or market segmentation, or some other matter is the constraint, then we should not spend our precious and limited resources (time, energy and money) on improving product or service quality.

I am compelled to reiterate: Focus is everything!

Every expenditure of time, energy or money on things that are not keeping us from making more money tomorrow than we are making today is a distraction.

That statement is true for any effort—even those described by executives and management teams as “improvement projects.”

That statement is true even if you are presently thinking about spending money on IT projects for your supply chain or updating your ERP system!

New Technologies Are Not Like Engine Additives

Contrary to what some believe, “pouring” new technologies into a company does not necessarily assure that the company will “start easier, run faster, produce less friction or get higher mileage.”

In my view, “ERP” has had two entirely different definitions: Of course, when it was first introduced, ERP stood for “Enterprise Resource Planning,” but it wasn’t long before small-to-mid-sized business enterprises seeking to implement ERP solutions came to recognize that ERP really meant “Everything Replacement Projects.” Implementations were generally massive and disruptive and such projects, in some cases, spanned several years and could cost upwards of a million dollars.

For most firms, that era came to a close shortly after the beginning of the 21st century. (Or, at least—in my opinion, it should have.)

The New Era of ERP

For most firms today, ERP should no longer be about “Everything Replacement Projects.” The new era of ERP should be about focus and “Extended Readiness for Profit”. The focusing steps in the new ERP are these and come from Eliyahu Goldratt’s Theory of Constraints:

  1. Identify the constraint: What’s keeping your firm from making more money tomorrow than you are making today?
  2. Exploit the constraint
  3. Subordinate every policy and decision to the constraint
  4. Elevate the constraint
  5. Go back to step 1 in order to keep inertia from setting in

This is the FOCUS of a process of ongoing improvement (POOGI)—your constraint—the one thing (or very small number of things) that is (or, are) keeping you from making more money.

Remember! You can survive any distraction if you keep your FOCUS on your organization’s goal.


Leave your comments here, or contact us!

Questions? Need Support?
Get in Touch