Tuesday, 29 June, 2010 Leave a comment
…80 year old Global Consultancy firm AT Kearney (ATK) say so. ATK appear to have a better understanding of complexity than most. So, I will happily let them tell you that, even by using the methodology they outline below, they claim that managing complexity will add up to 5% to earnings.
I hope that’s got your attention!? Because it gets even better.
WE BELIEVE THEM but can’t help but wonder how much more could be achieved if their means of calculation didn’t sound like a question for contestants in a Mensa “Brain of the Year” IQ competition! The process sounds pretty daunting and has all the potential to be a source of complexity in itself.
What they need is a means to measure complexity utilising the type of data that any well-run corporation collate as a matter of course. So that the measurement and management of complexity is an ongoing process NOT one of the jobs that the CFO or his/her staff dread.
There is only one company that can deliver that type of capability.
If ATK have such confidence in adding (up to) 5% to earnings as a result of a protracted, consultative, (qualitative/subjective) process – where the “observer”, inevitably, affects outcomes – imagine what could be achieved by undertaking a 100% quantitative (objective) assessment, using data currently generated by the enterprise!
“Risk Leaders” are those who recognise the competitive advantage to be gained by managing complexity: in existing operations (improving operational effectiveness); asset management; designing new processes; mapping & monitoring interdependencies; creating new products; internal risk and credit management; IT systems management; assessing Mergers & Acquisitions; managing supply chain risks, etc. Read more of this post