I have a horticultural background. In nature you find ecosystems (nothing lives alone by itself). In those ecosystems you find things that are not closely connected in time or space can affect each other. Change one thing, you affect something else. The same is true in business.
I was asked to coach a new executive at a troubled company. Six months earlier he implemented initiatives designed to cut costs as sales were starting to decline. In an attempt to get ahead of the curve, he looked at ‘excess’ inventory, deciding to cut there first. Two months passes. Production began to experience unexpected delays, salesmen had to make excuses. A couple months later, corners were cut to met quotas, service call ran higher and customers complained about delays. Sales dropped again. Each time they ‘fixed’ an issue with a ‘good decision’, another issue cropped up—each worse than the one before.
The executive was finding his management team’s responsibility and confidence undermined. “There’s nothing we can do about it,” he heard his managers say. “The problem is too complicated for us.” He feared his very system of management was unintentionally dedicated to mediocrity. This is where I was invited in.
As his coach, I encouraged him to look at his business as an ecosystem and not individual parts. 6 months ago, a snapshot view of the books led him to believe that excess inventory equaled waste. What he couldn’t see studying that one line on the balance sheet was that his business depended on that surplus for on time delivery, regardless of customer changes. In fact, this flexibility was what separated them from their competition. In a single decision, he had eliminated his company’s greatest competitive advantage.
Viewing his operation in a single moment in time, he never saw the whole picture. There was a fundamental mismatch between the reality of his business ‘system’ and his one-piece-at-a-time way of thinking. Working together, he came to realize that decisions he makes today often affect apparently unrelated parts of the business months later. This was a game changing moment for him.
Two things came to his attention first and he addressed them with the whole system in mind. A new sales process was designed, recognizing its cyclical nature and understanding that the higher than normal inventory numbers were unique to their business process. Over the next year the company began to regain market share and broaden its client base.
As an executive coach, I encourage all businesses I work with to take a broad ‘systems’ view of their operation. Otherwise, how can you possibly see the moving parts with a frozen image? If you look only at the individual trees, you can easily miss what’s happening in the forest.
Frank Hopkins is a certified Professional Coach (CPC) and certified by the Institute for Professional Excellence in Coaching (iPEC). He is a certified Master Practitioner (ELI-MP) of the iPEC proprietary assessment tool, the Energy Leadership Index and offers seminars on Energy Leadership. He maintains memberships in the International Coaching Federation (ICF) and the Institute of Coaching (ICPA).