hbr case summary simplicity minded management by ron ashkenas n.
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HBR case summary Simplicity-Minded Management (by Ron Ashkenas ). 1. Introduction. 1.1 Complexity, a Main Problem of a Company. As globalization, emerging technologies, and new regulations become important issues to companies, companies become more and more complex. Complexity.

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HBR case summary Simplicity-Minded Management (by Ron Ashkenas )


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slide2

1. Introduction

1.1 Complexity, a Main Problem of a Company

As globalization, emerging technologies, and new regulations become important issues to companies, companies become more and more complex.

Complexity

Issues to companies

  • Too many brands
  • Difficulty in assessing unit performance
  • No common method for tracking, reporting, or analyzing results
  • …….
  • Globalization
  • Emerging Technologies
  • New regulations
  • Ex)Sarbanes-Oxley
slide3

1. Introduction

1.2 Complexity in ConAgra Foods(real case)

Successful growth strategy eventually made ConAgra’s lack of cohesion and complexity.

ConAgra’s Growth Strategy

Acquiring well-known brands like Reddi-wip, Egg Beaters, Chef Boyardee, and Hebrew National

Allowing the acquired organizations to operate relatively autonomously

  • One of the largest packaged food companies in North America
  • Since 1970s, it has adopted strong growth strategy which appears to be successful

Successful

But, made it complex

slide4

2. The Causes of Complexity

2.1 Four main causes of complexity

There are four main causes of complexity, structural mitosis, product proliferation, process evolution and for the last, managerial habits.

Structural Mitosis

Product Proliferation

  • In most large organizations, structural shifts are happening all over the enterprise, all the time
  • The steady accumulation of structural changes drives up complexity over time
  • Most large organizations are better at adding new products and services than they are at eliminating
  • In fact, customers want fewer new features on some of the company’s core equipment

Causes of

Complexity

  • Many disciplined improvement techniques such as CRM, sales forecasting have failed except Six Sigma, lean manufacturing and so on.
  • All those processes evolve over time, but result in too much variability and inefficiency
  • Managers frequently behave in a way that exacerbates the problem, though they have the best of intentions
  • Poor e-mail etiquette and meeting management are the main causes of complexity

Managerial Habits

Process Evolution

slide5

2. The Causes of Complexity

2.2 How Managerial Habits Cause Complexity

The complexity is usually caused by the system of a company, but each individual in a company have significant effects on the complexity.

Poor meeting management

Unclear, redundant, or conflicting assignments

Micromanagement

  • Many managers insist on an excessive level of detail, generating needless hours of work
  • Sometimes, employees are spending more time in meeting rooms than on project work
  • “go study this”, “get this started”, “work with this so-and-so and get back to me”
  • Similar or overlapping assignments to different people

E-mail etiquette

PowerPoint Perfection

E-mail overload is a serious source of organizational complexity

Recirculation of documents in multiple drafts and redrafts is a significant sources of complexity

Presentations can overwhelm decision makers with data, arguments, and entertainment

Presentations that are so long and complex bore their audience

slide6

3. Simplification as Strategy

3.1 Streamline the Organizational Structure

Once managers have clearly framed simplification as a business imperative and connected it to measurable goals, managers can begin an ongoing attack on structural mitosis.

Transforming ConAgra Foods by Rodkin(1)

Before

After

finance

Product

supply

finance

Sales

Product

supply

R&D

HR

IT

Business

Unit #1

Sales

……

Business

Unit #2

Business

Unit #1

Business

Unit #2

Business

Unit #3

Business

Unit #3

slide7

3. Simplification as Strategy

3.2 Prune Products, Services, and Features

There are some important questions: Are there too many of them? Which are profitable and have the greatest growth potential?

Transforming ConAgra Foods by Rodkin(2)

Before

After

#1

#2

Growth Brands

#3

#3

#1

#4

#5

……

Potential for Divestment

Manage for Cash

#100

#101

#7

#10

……

#50

#101

More than100 brands were assumed to be equal

Sold out

slide8

3. Simplification as Strategy

3.3 Build Disciplined Processes

By RoadMap, similar to the GE Work-Out, ConAgra Foods could make more efficient processes.

Concept of RoadMap

Before RoadMap

Critical, but improper process

Massive amounts of data that run hundreds of pages

Idea for redesigning the process

RoadMap Meeting

After RoadMap

By RoadMap, ConAgra had a far simpler set of enterprisewide processesfor reporting, planning, capital expenditures and so on.

Employees related to the process

(more than 60 people)

slide9

3. Simplification as Strategy

3.4 Improve Managerial Habits

Managers need to identify how their own patterns of behavior complicate matters, and make a personal commitment to simplification.

What Rodkin did to improve managerial habits

“Jump ball problem”

Occasionally fail to specify which person should take the lead on a cross-functional or cross –unit issue

After discussing this tendency with the rest of the leadership team,

Rodkin was able to reduce the frequency of jump balls

Innovative product

??

R&D

Consumer

sector

slide10

4. Conclusions

There are some important messages which you need to keep in mind in this HBR case.

A simplification strategy must be treated as a business imperative, not a soft, “nice to have” virtue.

1

You need to keep in mind this phrase: “you can be the main source of the complexity which you hate.”

2

Making your organization simple and keeping it that way takes a lot of hard work

3