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Thursday, June 25, 2009

Opportunity in crisis: Throwing the rule book away

This morning, we're beginning to absorb the consequences of one of the most surprising (and rapid) business turnarounds I can recall.

Last Friday, I feared we faced a significant operating loss this month. Realizing this loss would be unsustainable, I extended deadlines by a week and then allowed, in fact encouraged, employees to sell without regard for some of our usual constraints.

(The constraints are operational, not ethical.)

These constraints are part of business systems developed over the years to increase efficiency and productivity, and avoid time-wasted effort on futile projects. They kept things simple, and prevented us from having to redo our work, or stress out totally on last-minute volume.

When I lifted the constraints, we discovered the shocking results that sales increased by 25 to 40 per cent on the same intrinsic potential business volume. In other words, our well-intended rules had cost us thousands of dollars in potential sales, every month.


(I'm not detailing specifics here -- this is a public blog and, after all, these discoveries represent private competitive advantages within our industry -- but it doesn't take a rocket science for anyone to realize that if a little extra work and confusion can generate this much yield, you should take the results very seriously.)

Sometimes it helps to throw your rule book away.

We now are building new systems to accommodate our discoveries.

Do you have similar opportunities in your business, masked by long-established and reasonable operating procedures?

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