Abandonment: a Key Tactic in a Down Economy
One of Peter Drucker’s signature concepts was called purposeful abandonment. You probably have heard of it before, in one context or another (I featured it in a previous posting). The key to purposeful abandonment is to figure out what to stop doing or what to stop making. (Peter Drucker once told his friend Rick Warren (The Purpose-Driven Life), don’t tell me what you are doing, tell me what you have stopped doing).
If you work in an organization of any size, chances are that that there are things you need to stop doing, even in a healthy economy. That’s because it’s easy to fall into a trap of continuing to do something long after it has served its purpose. Call it inertia, call it laziness—the reason doesn’t matter. But I have never heard of a perfect corporation that only does the things that are absolutely necessary to the proper functioning of that organization. In a hobbled economy, the role of abandonment becomes that much more important for readily apparent reasons.
Please take a few minutes and answer the following questions. If you do identify some money-saving, abandonment tactics that will work in your place of business, be sure to jot them down and put them into action asap:
* What documents or reports require signatures/approvals that no longer require that level of approval?
* What reports or documents do you print out that can simply be viewed on-line—helping your organization to move toward a paperless office?
* What products/product lines no longer provide the organization with the same level of profitability, meaning that they are likely the cash cows of yesterday than tomorrow?
* What products or services might your company experiment with today that might turn out to be the cash cows of tomorrow?
* While I always feel that cutting people should be a last resort, have you considered cutting “the bottom ten percent” of your workforce each year as a regular exercise (as Jack Welch, former CEO of GE urged managers to do)?
* What ideas do your employees have that will save the company money? If you haven’t asked them you have overlooked one of the best sources of potential money-saving tactics.
Remember why you are looking into these potential steps. You want to make some changes so that the entire enterprise is never put at risk, even if the economy continues its downward spiral.