
Waging War on Complexity Costs: Reshape Your Cost Structure, Free Up Cash Flows and Boost Productivity by Attacking Process, Product and Organizational Complexity
by Wilson, Stephen; Perumal, AndreiBuy New
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Summary
Author Biography
Andrei Perumal is managing director of WilsonPerumal & Company, Inc. He helps business leaders solvechallenging problems with a focus on integrating strategy,operations, and organization.
Table of Contents
About the Authors/Acknowledgments | p. vii |
Foreword: Why This, Why Now | p. viii |
A Call to Arms: The Imperative for Action | |
The Imperative for Waging This War (And the Need for Better Battle Strategies) | p. 3 |
An Island of Profit in a Sea of Cost | p. 5 |
Decomplexity Case Study | p. 6 |
Why Companies Lose the War or Avoid It Altogether | p. 7 |
The Art of Complexity Warfare | p. 9 |
The Opportunity: Big gains, with speed | p. 16 |
Deep Dive#1 - What Winning Looks Like: Cash Flows, Profits, and Performance | p. 19 |
The Nature of Complexity (And What It Means for Your Business) | p. 27 |
The Three Types of Complexity | p. 27 |
A Three-Dimensional View of Complexity | p. 32 |
The Geometric Nature of Complexity Costs | p. 33 |
Implications for Waging the War | p. 36 |
Preview: Taking out complexity costs | p. 39 |
Moving forward with a Fuller Understanding | p. 41 |
The Rise and Rise of Process and Organizational Complexity | p. 43 |
The Three Waves of Process Architecture | p. 45 |
Conclusion | p. 55 |
Deep Dive≠2 - Assessing Your Company's Cost-Cutting IQ | p. 59 |
The Cost-Reduction Pitfalls | p. 59 |
Assessing Your Company's Cost-Cutting Biases | p. 66 |
Sizing Up the Prize, Part 1: The Fundamentals of Making the Financial Case | p. 67 |
Making the Financial Case to Focus the Organization | p. 68 |
Why Companies Struggle to Size the Ptize | p. 68 |
Fundamentals for Quantifying the Cost | p. 70 |
From Fundamentals to Method: An introduction to the triangulation approach to sizing the prize | p. 74 |
Conclusion | p. 79 |
Sizing Up the Prize, Part 2: The Methodology for Quantifying Complexity Costs | p. 81 |
Calculate the lower bound | p. 83 |
Calculate the upper bound | p. 85 |
Pick a stretch target | p. 86 |
"Sizing the Prize"Example | p. 90 |
Next: Re-imagine your business | p. 93 |
What the CEO Needs to Know | p. 93 |
Know Thine Enemy: The Faces of Complexity and Implications for Battle | |
Introduction to Part II | p. 96 |
Deep Dive #3 - The Juice Dilemma: A Case Study on How a Larger Portfolio Can Lead to Smaller Profits | p. 99 |
Background on Morley Farms | p. 99 |
The Opportunity | p. 101 |
The Analysis | p. 102 |
Impact on Morley Farms | p. 105 |
Further Insights from Morley Farms | p. 107 |
Conclusion | p. 109 |
Where Complexity Arises: The Product/Process Face | p. 111 |
Common Symptoms of Product/Process Complexity | p. 113 |
Major Interactions on the Product/Process Face | p. 114 |
Key Implications for Battle | p. 126 |
Recommended High-Value Battle Strategies | p. 128 |
Conclusion | p. 129 |
Where Complexity Hides: The Process/Organization Face | p. 131 |
Common Symptoms of Process/Organization Complexity | p. 132 |
Major Interactions on the Process/Organization Face | p. 134 |
Key Implications for Battle | p. 142 |
Recommended High-Value Battle Strategies | p. 145 |
Conclusion | p. 146 |
Where Complexity Takes Root: The Organization/Product Face | p. 147 |
Common Symptoms of Organization/Product Complexity | p. 151 |
Major Interactions on the Organization/Product Face | p. 153 |
Key Implications for Battle | p. 157 |
Recommended High-Value Battle Strategies | |
Conclusion | p. 160 |
Summary to Part II | p. 161 |
Battle Strategies to Eliminate Complexity Costs | |
Introduction to Part III: Taking Ground | p. 166 |
Developing a Battle Plan | p. 167 |
Taking Ground against a Difficult Foe | p. 169 |
Conclusion | p. 170 |
Portfolio Optimization (A): What Really Matters | p. 171 |
Why Traditional Rationalization Efforts Often Fail | p. 173 |
The Three Factors That Really Matter | p. 176 |
Conclusion | p. 181 |
Chapter 10 - Portfolio Optimization (B): SKU Analysis and Selection | p. 183 |
Understanding Incremental Revenue | p. 183 |
Understanding Incremental Cost | p. 187 |
Implications: Categories of SKU removal | p. 194 |
Creating a Portfolio Optimization Plan | p. 199 |
Growing Revenue | p. 199 |
Network and Footprint Consolidation | p. 203 |
More Complex than We Need to Be | p. 205 |
Meeting the Future Halfway | p. 207 |
Cadbury: Clearer choices, greater focus | p. 211 |
Conclusion | p. 213 |
Component Rationalization and Vendor Consolidation | p. 215 |
Defining Component Rationalization | p. 216 |
140 Batteries and 25,000 Forecasts: A case study in component complexity | p. 217 |
The Benefits of Component Rationalization | p. 218 |
Getting Bang for the Buck with Component Rationalization | p. 220 |
Learning the Hard Way: A case study | p. 222 |
The Big Question: Broad versus targeted | p. 224 |
Conclusion | p. 227 |
Enabling Variety with Lean Processes | p. 229 |
The Basics of Lean | p. 229 |
Leveraging Lean for Step-Change Improvement: Six key lessons | p. 232 |
How Lean Enables Variety | p. 241 |
Conclusion | p. 244 |
Process Segmentation: Minimizing the Effects of Variety | p. 245 |
Diagnosing Process Segments | p. 247 |
Approach to Process Segmentation | p. 250 |
Conclusion | p. 253 |
Project Rationalization and Resource Utilization: Getting More Done faster and with Fewer Resources | p. 255 |
Our Approach: It all starts with fewer projects | p. 256 |
Doing More, Faster and with Fewer Resources | p. 261 |
Conclusion | p. 267 |
Dynamic Operations: Optimizing Complexity Trade-Offs | p. 269 |
Case: RME Pharma, Inc | p. 271 |
Recognize the situation | p. 272 |
Quantify the relationships | p. 277 |
Optimize the system for the situation at hand | p. 280 |
Recap of RME Pharma's Experience | p. 283 |
Moving Forward | p. 284 |
The Conundrum: Why do many companies struggle with managing complex systems? | p. 285 |
Defense Strategies to Keep Complexity Costs at Bay | |
Introduction to Part IV Building the Capability to Keep Bad Costs Out | p. 288 |
Deep Dive #4 - A Corporate Complexity Metric: Tracking Progress at the Macro Level | p. 293 |
Conclusion | p. 294 |
Curbing Product and Service Complexity | p. 295 |
Roles of a Chief Complexity Officer | p. 295 |
CCO Role 1: Managing the level of complexity in the business | p. 296 |
CCO Role 2: Building the organizational capabilities required to manage complexity | p. 303 |
Conclusion | p. 304 |
The Lean Operating Model: Creating a Structural Barrier to Process and Organizational Complexity | p. 307 |
The Seven Steps to Developing a Lean Operating Model | p. 310 |
The U.S. Navy's Operating Model | p. 315 |
Why ERP Deployments Go Wrong and the Need for Lean Operating Models | p. 317 |
Case Study: Winning the retail wars with the Tesco Operating Model | p. 319 |
The Relentless Pursuit of Perfection | p. 321 |
Appendices | p. 323 |
Index | p. 337 |
Table of Contents provided by Ingram. All Rights Reserved. |
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