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From the Ask Tom mailbag –
Question:
Our company somehow always manages to pull the rabbit out of the hat, put the fire out that saves the refrigerator, crosses the finish line crawling through glass. But, we can never relax. Every major project is drama. Every major project is the one that will put our company over the top, but we never quite make it. We are always in a state of overwhelmed. Don’t get me wrong, our customers are very happy and return to us, project after project, but it is such a struggle. We never get to breathe, we never finish in stride.
Response:
Your company is operating at S-II (implement), in a market that requires S-III (system). If your organization is completing one project well, what does it get? Another project.
If your organization is completing two projects well, what does it get? A third project. How does it do the third project? The same way it does projects one and two. So, what does your organization get? Another project.
But, what if your organization got fifty projects? How would it do fifty projects? Certainly, not the same way it did projects one and two. Most S-II companies would kill to get 50 projects, not realizing that the 50 projects will kill them. What’s missing? S-III (system) capability.
S-III stands back from the 50 projects and sees the common pattern, extracts that pattern into a system. The system optimizes resources, reduces waste and minimizes effort. The company that wins the race is the one that goes the fastest with the least amount of effort.
S-III (system) brings consistency of output, it’s always the same. Consistency of output yields predictability of output, so we can codify our system. This predictability helps us understand the real cost, now predictable, so we can build in reasonable profit.
Whenever I hear about a profitability problem, I never look for what‘s causing the problem. I always look for a who. In this case, it is a who, with capability at Stratum III. -Tom