Keep it Simple

Author Charles Yeung
Translated by Soula Lo
Recently, while browsing some books about successful enterprises, I found some concepts worth learning about. Therefore, I have written some notes here for people who share the same interests.
After some investigators did careful research and analysis, they discovered that the strongest corporations in the world almost all follow the law of simplicity. Their conclusion is: the law of simplicity is the most basic and most effective principle for an enterprise to develop and prosper.

When John Francis Welch, Jr. first took up his tenure as the chief executive of the U.S.-based conglomerate General Electric, the production lines were long and messy; many products sales were at losses. After Welch seriously considered and analyzed, he produced a rule of “No.1 or No.2.” They must make the products No. 1 or No. 2 in this line of trade within their target deadline; otherwise they would have to sell that division. After many years of development, General Electric has become one of the most competitive conglomerates in the world.

In the management field, the law of simplicity has become the key of success for continually developing companies. The principle of KISS (Keep it Simple Stupid) is popular around the business circle.

It is undeniable that human beings have entered an overwhelming age. The population of the world has grown over six billion, and environmental issues become more severe each year. Man with man and man with nature conflicts have been unprecedented and have intensified.

The most serious issue is: as our organization’s structure is continually expanding, the form of system becomes more and more complicated, documents become heavier and heavier, and thus, efficiency becomes worse and worse. If we pay close attention to it, we will discover that business reports often contain very thick files each month, and the intended goals on the list are often more than we can count. In the past, our development and prosperity were dependent on data. Today, we realize that we have become the slaves of data. While facing an overloaded world, the over-swollen organizations, with too much desire makes people very hard to breath. Nowadays, we need a glittering sharp razor to cut off the entire tedious burden more than ever.

When we look back at history and look into today’s world, human beings seem to always like to make things more complicated, but complicated things do not mean they are better. In fact, due to the limit of human’s thinking, simpler data would benefit human’s thinking and decision-making far more than complicated data.

The Nobel Prize winner, Herbert Alexander Simon, studied artificial intelligence for some years, and he discovered a fascinating conclusion: humans are not good at dealing with big volume of data. The studies found that the general public can only remember 6 or 7 items of information or data in a short period of time; therefore, complicated matters and huge amounts of data are usually a burden to people.

The reality in the business world is the same as in life, always developing towards more complicated directions. All complicated organizations have the same problems of wasted resources and low efficiency. Especially to large organizations, they don’t focus on something they should pay attention to. Also, most big organizations are engaged in expensive but unproductive activities, and the number of these types of activities is huge. Every organization is a product caused by many opposed and assisted forces that interact with each other. And this kind of confrontation usually has a majority that is full of detailed and unimportant influences working together to confront the minority important force. The trivial and useless majority force represents the omnipresent inertia, incompetent and selfishness. These influences mixed with vigorous and creative forces within the same organization, often results in many employees unable to tell the difference between garbage and gemstones.

In fact, we only need to change the way we do things, and do less useless work, and everything will have a great transformation. We only need to eliminate low value and negative value items, simplify ongoing activities, thus, we can decrease costs and increase efficiency. Complication often causes waste and burden. High efficiency comes from simplicity, and simplicity comes from ruthlessly eliminating all the minute and complicated things.

1-page memo
Outstanding corporations generally have the same simple characteristics. The American P&G Company is the best example. The brand manager of P&G Company said, “P&G has one slogan-1-page memo, it is the essence from our many years of managing experience. In fact, any proposal or project more than one page is a waste to us, and it even causes bad consequences.”

This style can trace back to the former general manager of P&G Company, Mr. Richard Deupree. He especially hated a memo containing more than one page. Usually he would return the long memo and add one demand, “Simplify it to something I need.” If the memo is too complicated, he even added this line, “I don’t understand complicated problems. I only understand simple ones.”

A visitor asked him to explain this. He said, “Part of my job is to train people to break down an involved question into a series of simple matters. Then we can all act intelligently.”

The power of the 1-page memo is determined by its simplicity and is easy to understand. It is much more efficient than to spread key points all over dozens of piles of papers. The outstanding corporations have one key characteristic: simplicity. If a company has a simple form of organization, it can accomplish its job with very few employees.

Most outstanding corporations have relatively less employees at the managing level. The employees spend most of their time doing the practical work to solve problems instead of reviewing reports in their offices.

Emerson Electric Company has 50,000 employees, but the headquarters has less than 100 employees. Dana Incorporated has a total of 30,000 employees and the headquarter employees has decreased from 500 to around 100 now. The founder of Walmart, a company with more than 20 billion in assets, Samuel Moore Walton stated he believed in the rule of a no-man headquarter, “The key is to walk into a store and listen.” Thus if you want your organization to be more efficient, more lively, you need to reduce the weight of your organization.

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