I’d like share a true story. I share it because it highlights blind spots that are not as unique as you might think. In fact, this brief article could just as easily be about your business in some fashion.
A few years ago, I was retained to fix what the client said was a “data anomaly”, which had lingered for years. No one inside could solve it. Unsurprisingly, we easily unmasked this “anomaly” as an enterprise wide “train wreck” of bad data. I define “bad data” as that which is un-useful…un-used… or worse…misleading to those who need it to make decisions affecting company performance. (If you have P&L responsibility, we ask you read on).
After 6 months of unraveling this mess, with ceaseless questions to the stakeholders and users of this information, we suggested some strategic and obvious fixes. Approval of this initiative had to go to the top. Our meeting with the President was an eye-opener, and rather shocking. The fact was that the President did not have a clue that the dashboard he was using to check company performance was both wrong and misleading. More, when we asked what “drove revenue” in his business, insofar as the dashboard he was using, he could not answer it with certainty. (For background, after 6 months of looking at every piece of information inside the company…we already knew this). For further context, in all the previous 5 years the client cut headcount to save money. Headcount reduction was his primary tool to remove expenses to protect the net income. By examining the impact of key individuals leaving, we also knew that these headcount reductions cost them 3X more than their perceived savings!
Fortunately this story has a happier ending, as we were able to show & execute a 10% savings (in the multiple 7 figures) in his Operating Expenses over a 2 year period without touching headcount.
The moral of the story is that all the answers to improving the company’s performance were right there…under their nose. If you have P&L responsibility, we urge your intellectual curiosity, and demanding your unit heads rationalize every dollar both made and spent. Can they prove the “activities” they are charged with make…or lose…your company money? With absolute certainty, we can guarantee that this ongoing exercise will improve your performance…personally and professionally.