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10 Principles to Optimize Your Business Results: Principle #1 – The Business as a System

02 Dec

The first of our 10 Principles concerns a critical if sometimes ugly truth: Every company is perfectly designed to produce the results it gets. Every function within the company and how they are aligned contributes to the designed results. If you don’t like the results you’re getting, you have to change the design.

Before I turned my full focus toward turning businesses around, I spent many years as an engineer. Engineers, of course, have to know how things work. It’s not enough to design a beautiful cog – you have to know exactly how that cog interacts with other cogs, gears, and sub-assemblies to achieve a desired result. You have to visualize the entire system so that if something goes wrong, you can pinpoint the problem or see how multiple problems aggravate each other to cause a systemic breakdown.

Companies are systems too. Their sub-assemblies are made up of departments. Departments are made up of teams. Teams are made up of people. All of these components must work together to ensure a properly functioning system. If you’ve selected faulty parts, don’t expect your system to yield good faultless results. On the other hand, you can assemble the most beautifully crafted parts in the world into your machine, but if that machine has a flawed design, it still won’t give you the results you want.

CEOs ultimately hold the responsibility for the design of their business. They choose the systems, select the teams, and develop the structures that make the difference between glorious success, abject failure – or, in the middle of the spectrum, inertia.

Does your company’s design meets specifications? Are you getting what you originally envisioned? If not, examine your systems for flaws – and be ready to go back to the drawing board.

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