12/29/2008
Step 2: Think outside-in To summarize the argument of Step 1 (Be prepared to change the way you think): our organizations are designed and managed as top-down hierarchies. It is this very thing – the design and management of the work – that precludes improvement. Thinking outside-in instead of top-down is much more than running customer surveys; it is to understand the nature of transactions you have with your customers. If you follow all of the steps in this series, you will discover for yourself how top-down thinking can actually impede performance. For example, the control of costs can actually cause costs to rise. By contrast, the optimization of flow – working outside-in – always reduces costs.
Figure 1 What is the purpose of your organization? Thinking outside-in leads to better methods Think about it this way. Your customers can only take their view of you from the transactions they have with you. If those transactions are positive for your customers they will be likely to come back; if they are amazing, the customers will tell their friends. If, at every point of transaction you could understand the ‘value’ work – what matters to the customer – and do that AND ONLY THAT, your service would improve and you would be more efficient. Why? Because you would have no waste: good service always costs less – a concept many managers struggle with. When you take an outside-in view of a traditionally designed (top-down) organization, you always find an enormous amount of waste that in turn is associated with poor customer service. Take, for example, a cable television company. Looked at from the point of view of its customers, it looks like this: |