Is Your Organization Anorexic?

March 8, 2009  

The President of a $1 billion company once asked me to describe his organization in one word. My response?

“Anorexic.”

The Vice Presidents who sat around the table nodded in agreement.  They assumed that I meant there was no fat left to cut.  That is not what I meant.

Anorexics often have relatively “high” body fat percentages because their lean body mass erodes along with the fat.

This is what many organizations have done.  An an effort to cut costs, in addition to cutting fat, they also cut large amounts of lean body mass.

Are you thinking of further cost cutting?  If so, what are you eliminating?  Fat?  Bone?  Muscle?  Vital organs?  No company in history has ever “cut” its way to long-term success.

Exercise grows muscle while burning fat.

Innovation is exercise for businesses.  It helps grows the organization while also enabling cost efficiencies.

During the depression, Henry Ford said, “A man who stops advertising to save money is like a man who stops a clock to save time.”

The same is true for innovation.  Although cost cutting may be a necessary short-term tactic, it is NEVER a strategy.  If you are in cost-cutting mode, make sure that your cuts target fat and not lean body mass.  In addition, be sure to exercise your organization,  Invest in innovation now and you will be prepared for long-term growth and success.

P.S. I like this photo. It nicely depicts the obsession that many companies have with measuring everything in sight, yet in the end not measuring anything of value.

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6 Responses to “Is Your Organization Anorexic?”

  1. Andrea Meyer on March 8th, 2009 8:41 pm

    Thanks for your post. Your comment about cost-cutting that may erode body mass + fat, combined with your final P.S. leads me to ask: have you found any effective ways of measuring innovation? Something to guide managers about what to cut vs. what to invest in?

  2. Steve Todd on March 9th, 2009 9:32 am

    Good question by Andrea. Often times innovative employees might get cut because of the product/project that they work on. How to identify the ones that are truly innovative and should be kept? How about number of products delivered, papers written, patents applied for, etc.?

    Interested in your thoughts,

    Steve

  3. Stephen Shapiro on March 9th, 2009 6:39 pm

    Great questions…I will answer them this week in a separate blog entry. Thanks!

  4. Measure Innovation NOT InnovationS | Business Innovation Speaker and Consultant Stephen Shapiro on March 25th, 2009 3:52 pm

    [...] Be sure to read my blog entry entitled “Is Your Organization Anorexic?” It explains why I chose the picture I did. In short, companies are obsessed with measures [...]

  5. Steve Shapiro on March 27th, 2009 8:49 am

    Andrea, check out my latest blog entry on measures- http://www.steveshapiro.com/2009/03/24/measure-innovation-not-innovations/. I realize it doesn’t address your question 100%. And Steve, I know I haven’t talked about your question yet. But I will address everything more fully in a blog post next week. Thanks.

  6. Steve Shapiro on April 16th, 2009 7:56 am

    A reader of my newsletter sent me this…

    “Your anorexia analogy is excellent, and I wonder how many of the nodding executives realize that their salaries are the ‘fat’ in the equation. Zero, is my guess.”