Strategic Simplicity - The All-In-One Solution to Business Complexity

Business complexity can be a real killer. It saps a company’s strength, reduces its speed to market and hinders its ability to focus on what matters—creating innovative products that meet customers’ needs. In a fast-paced, always-on world, it’s easy to get jumbled up by the constant stream of new challenges and business changes—globalization, innovative technologies, regulatory requirements, etc.

To avoid being swamped by complexity, companies need a clear, focused strategy to eliminate unnecessary processes and to streamline operations. They also need a culture that values simplicity. And they need to be willing to put in the hard work. But implementing simplicity as a strategic imperative requires more than a feel-good theme—it demands an explicit strategy and vigilant attention over time.

One approach is to engage employees at the grassroots level to generate simplification and improvement ideas and to implement a few key ones, which can produce a big return. This is what ConAgra Foods’ CEO Gary Rodkin did when he took the helm of the company in 2012. He made it clear to his managers and associates that the company was overly complex, driving up costs and hurting profit margins—and making it difficult to invest in growth opportunities. Rodkin’s approach was a powerful way to demonstrate that the company was serious about simplifying and improving its operations.

Another way to achieve a clear and focused business is through what BCG calls smart simplicity. This involves using a set of six simple rules to help an organization streamline while fostering employee cooperation to develop solutions. The rules are:

Understand What People Do - Identify the specific behaviors that influence performance. Ensure that everyone has a shared language for explaining what they do. Establish rewards for cooperating and penalties for non-cooperating. Promote a common agenda based on the company’s values, goals and resources.

Make it Easier to Communicate - Create an open environment for sharing information and ideas. Streamline internal communications and external customer engagements to foster collaboration and innovation.

Develop a Purpose-Centered Culture - Emphasize the importance of purpose and the role that it plays in building trust. Develop a culture that focuses on creating value for the community and for customers, and encourages employees to take pride in what they do.

It’s not just large organizations that struggle with complexity; many small businesses have similar challenges. The good news is that a few simple steps can help them overcome their complexities and become more productive and competitive. The best way to get started is to identify all the factors that have jumbled up your company, and then make a conscious effort to clean things up. It will be hard—but in the end, it will be worth it.

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