When it comes to freedom of choice, could less be more? Today's globally networked economies offer consumers more power than ever before — enabling them to compare dozens of options and prices at the click of a mouse. But as companies respond to such opportunities by dramatically expanding their menus of products and services, they are being dragged down a slippery slope of business complexity that could eliminate the gains. In fact, a new book titled, Conquering Complexity in Your Business, suggests that in many cases both business providers and consumers could benefit from fewer choices.
Written by Michael George, CEO of the Dallas-based consulting firm George Group, and by Stephen A. Wilson, director of the firm's Conquering Complexity practice, the book argues that organizations pay a price for diversifying their product or service portfolios beyond a point.
In the case of individuals, the phenomenon is easy enough to spot. Highly motivated individuals often add task upon task upon task to their responsibilities, but eventually they become dysfunctional because they try to do too many things with too little time to do any of them well. Organizations are vulnerable to the same creeping malaise. Complexity, or clutter, eats away at profits by diverting scarce resources and by masking true profitability. In a recent conversation, Eric Clemons, a Wharton professor of operations and information management, spoke with Complexity co-author Wilson and Matt Reilly, a George Group vice president of client services, about how complexity can sap a company's business and how the problem can be overcome.
Clemons: Let's start by defining complexity—what is it, in the context of your book?
Wilson: Complexity refers to the mixture of products, services, features and options that a business puts on the market. When a company's menu of goods and services is out of step with the market, customers won't benefit from or pay for the excess.
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