My Complexity Reduction Checklist (Or: 5Whys [5 Times Why] Is So Abstract!)

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In my last blog I advocated the 5Whys methodology as an approach to arrive at lean systems and to reduce complexity. Many of you considered this an abstract advice, and asked me whether I could give an example.

Example: Interaction Management

Some thinking about this reminded me of an article in the McKinsey Quarterly on interaction management. This article, published in 1997 (!), and well worth your reading, discusses the consequences if people can more easily find the products and services they are looking for, and need less time to find the information they are looking for. This makes it possible to compare products and services easily, and act upon that.

Definition of Interaction Management

McKinsey defines economic interaction management as:

  • The way individuals and organizations try to find the right party with which to exchange something (information, goods, or otherwise).
  • To arrange, manage, and integrate the activities associated with this exchange.
  • To monitor performance

The McKinsey researchers predict that, when interaction becomes more easy, transparency will grow and goods and services will become much cheaper. People will have more time to perform other activities. Hence the added value of activities will increase fast.

We all know that this prediction from wayback has become true, and is still becoming more important: Information at your fingertips, and that kind of stuff. It also introduces the need for new regulatory processes like information governance.

The Interaction Management Obsolete Assumptions Checklist

McKinsey also provides a page with suggestions to challenge the old assumptions. Chances are large that those assumptions have become obsolete today, or will be in the near future. Let me give you some examples, which can double as the examples of 5Whys you required.

What Are Your Options

These questions suppose that your business could change significantly as a result of increasing interaction. With significantly I mean 50% or more. The why-question is used here to indicate that reflection is mandatory. Of course it is possible to provide an easy answer, but that probably won't help you. You should consider as possible action types (free to Paul Watzlawick c.s.,
Pragmatics of Human Communication):

  • I will not change my company.
  • I will reduce the interaction in my company.
  • I will increase the interaction in my company.
  • I will go for a radical business change.

Customer Service Questions

So, what would you do if:

  • You could double your revenue by using the Internet for Marketing and Sales? Why?
  • Your customers could easily compare your products and services with other offers? And go shopping elsewhere? Why?
  • Special, and currently added value products and services, became a commodity, and simple standard products tend to disappear? Why?

Business Configuration Questions

What would you do if:

  • Your purchase costs became significantly lower? Why?
  • Your business process operation costs became significantly lower? Why?
  • This influenced your mission and strategy significantly? Why?
  • Through the enhanced transparency you found out your next-to-core products an services were significantly too expensive? Or too cheap! Why?
  • You could service your customers directly, passing intermediate stations? Or if adding an intermediate would significantly increase your profits? Why?

Organization Questions

What would you do if:

  • You were able to reduce business process complexity through sophisticated interactions? Why?
  • Significant reduction of your workforce is possible through sophisticated interaction management? Why?
  • You could reduce physical assets drastically? Why?

We are deeply interested in your opinions! Please feel free to interact with us. Contact Hans Lodder now!

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