The best organizations reach an 80/20 ratio where 80% of their resources are directed at actions and decisions that directly or indirectly positively impact their customers. Examples might be: improving the buying process, adding a feature to your products, offering a new service, creating a new marketing campaign. You get the idea.
20% of resources are directed at structuring and managing people and teams, organizing work, running the company, etc., and are necessary.
In my experience, however, many companies waste a lot of resources on internal issues which have no bearing on their customers or products.
To name a few “resource-killers”: turf battles between departments, poor leadership, unclear or no strategy, focus on tasks rather than results, perfectionism and risk aversion, inefficient infrastructure, inclination to follow the latest fads, etc.
Their internal “burn-rate” reaches at times up to 50-60% of their resources, often with catastrophic consequences for their business (e.g. loss of customers and revenue, talent attrition, lack of innovation, etc.)
A simple question you should ask yourself when facing major discussions, issues, initiatives is this: How much does this add to our bottom line and how is our customer better off as a result of it?
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