Digital Simplification - Effective management of simplification, buy in from middle management and support from leaders across operating units will work towards a successful roll out of new technology and processes. Simplification to increase visibility into operations (at the article level and overall volume) will enable operational planning for all the facilities through planning tools.
This will help improve employee productivity through better manpower planning. The advent of internet, mobiles and alternative means of communication has led to a serious set of challenges for the “So what we’ve tried to do inside the company is really just drive what we call a “culture of simplification”: fewer layers, fewer processes, fewer decision points, says Immelt. We’ve adapted the lean tools in what I would call a Silicon Valley approach, what we call “Fast Works.”
We’ve embraced some of the Silicon Valley tools in terms of putting everything on the clock, bringing commercial intensity into the company. The way I describe that is, like biggest companies, we’re willing to take all kinds of market risk so that we don’t have to take internal risk, right? We try to say, “Look, let’s actually be aggressive in the markets, and let’s count on our own execution to risk reduce inside the company.” And broadly, getting to digitization, we’re democratizing information inside the company; getting IT tools that were contemporary in a mobile setting, and we call these things the culture of simplification”.
Simplification includes a high-level mapping of the business’s future architecture, the Target Operating Model (TOM) represents the future state of the business, based on an evolution across the enterprise and in vital areas including technology and operations. Integrated design tools are used to manage the complexity of large organizations from architecture through to detailed design and requirements management. Multiple iterations are necessary to develop an optimal TOM.
This step addresses the creation of the initial TOM, which is updated and refined as part of detailed design activities. In theInterview with John D. Sterman - Professor of Management Science Director, System Dynamics Group Massachusetts Institute of Technology," Jay Forrester frequently likens this problem to solving in your head a hundredth-order nonlinear differential equation system, but, frankly, that's an underestimate, because a hundredth-order system would actually be quite a considerable simplification from the real-life systems people have to deal with. Evolution did not equip us with the capability to simulate intuitively the type of complex, dynamic systems we have created for ourselves.
The result is an interesting dilemma. The better job you do with the conceptual modeling tools the better your mental map of how a system works, the less able you are to use that map to make reliable inferences about the consequences of new policies or new structures you may want to put into place.
The solution is to test the models, to test your hypotheses about the consequences of new policies. In most of the social systems we are concerned with, experiments in the real world are, prohibitively costly, unethical, or simply impossible. Simulation then becomes the only means to determine the consequences of policies you might want to try”.
Complexity Drives Digital Simplicity - Martin Mocker, Peter Weill and Stephanie L. Woerner in MIT SMR 2014, “Revisiting Complexity in the Digital Age” write, “With a clear vision and a simple set of metrics identified, we suggest companies seeking their complexity sweet spot consider the following steps: Assess your company’s current complexity position.
“The first step, the authors state, “is to determine where your company is now on product complexity and process simplification. The best place to start is by assessing your customers’ needs against your product and service offerings. Are your key customers satisfied with your level of product variety and linking? To find the answer, we suggest asking three questions:
1. Do your best customers buy from companies similar to yours? Why?
2. Is your customer satisfaction rating (such as a Net Promoter Score or similar measure) lower than those of competitors that offer more product variety and linking?
3. Is there work your customers do that you could do for them? For example, the USAA service to purchase a car includes negotiating with the car dealer for the best price”