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To find savings, a company should first look at small changes – the low hanging fruit. (Getty Images/iStockphoto)
To find savings, a company should first look at small changes – the low hanging fruit. (Getty Images/iStockphoto)

MANAGING BOOKS

Forget the strategic transformation, going after the low-hanging fruit reaps more rewards Add to ...

Low-Hanging Fruit

By Jeremy Eden and Terri Long

(John Wiley & Sons, 200 pages, $26)

Why not try turning complaints into collaboration?

Consultants Jeremy Eden and Terri Long suggest going to a unit in your company that uses what you produce – or a unit that produces what you use – and asking the managers whether they will swap one of their people with one of yours for a few days or a few weeks. That interchange may lead to a realization some simple changes would make life easier in one or both departments and save money for the organization as a whole.

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Another way to get a fresh perspective quickly and cheaply is to ask your new employees for suggestions on how you can improve your operations. Get a list of individuals hired in the past year, invite them to a brown-bag lunch, and ask them to suggest things that are being done better elsewhere. At one company, more than $20-million was saved by adapting a production technique from a firm where a new employee had worked previously.

Those are two examples of low-hanging fruit – simple and practical ideas – that companies forget to grab as they seek process improvements. “Unfortunately, cost cutting often leaves the low-hanging fruit and instead just lops off the branches without regard to what is left on the tree,” the two consultants write in their book Low-Hanging Fruit: 77 Eye-Opening Ways to Improve Productivity and Profits. “We have seen over the decades that harvesting low-hanging fruit produces bigger results with much less risk than those big projects on which companies rely, like strategic transformations and enterprise-wide systems!”

They view corporate reorganizations, new business management software systems, and grand cost initiatives as the equivalent of big-game hunting. Executives start the programs with great hope and fanfare. But usually not much is accomplished. Instead of hunting, they recommend harvesting: Taking advantage of a lot of small ideas that can add up to big bucks.

For example, to stop wasted spending, put a notional price tag on everything. One executive filled a large conference room with copies of all the reports the company produced, each with a Post-it note announcing the cost. Within a few weeks, hundreds of thousands of dollars were saved by eliminating, simplifying, or automating various reports.

In some cases, looking for excess costs can allow you to eliminate elements of a product or service the customer doesn’t want. They note that doesn’t mean just reducing the number of pieces of candy in a package while charging the old price. One of the world’s top food companies, studying costs and value, heard from a worker that the big, juicy chunks of tomato in its sauce caused the machinery to clog up. When the company checked whether their consumers truly valued the tomato chunks they actually found the opposite: A smoother sauce was preferred. So the company could save $500,000 and increase customer satisfaction with this simple change.

Companies often use benchmarking to improve their performance, comparing themselves to the best in the field. But the two consultants frown upon that. First of all, nobody is doing exactly what you can do, so the comparisons may be erroneous and other firms’ processes may not fit if applied. But at a deeper level, benchmarking doesn’t show you the best that can be attained, just what is the best today. And you should be aiming for the best possible.

Brainstorming to solve problems is another practice they discourage. “Brainstorming sessions get everything wrong: Too many people attending, too few participating, not enough critical thinking, too little preparation and follow-up,” they write.

They enthusiastically support brainstorming to find problems, however. And once those are identified, organizing problem solving sessions that are almost the exact opposite of the brainstorming you now do. In each session, engage from three to seven experts who will follow a structured meeting guide to come up with a few very good ideas to solve a specific problem. “Brainstorming is like a food fight; problem solving is like a master cooking class,” they say.

When ideas are implemented, hold managers accountable. They suggest that if an idea is flagging in implementation, the manager should get formal approval to withdraw the program – and must replace the withdrawn proposal with a new idea that can deliver the promised savings.

Speaking of savings, beware of what they call “soft dollars.” A manager may proclaim, “If we get the new software, our 100 operators will be able to save 30 minutes of manual reporting a day, which is worth $350,000.” Press for how much the staff can be reduced, which will harden the soft (or imaginary) dollars that have been touted.

This is a punchy, easy-to-read book, with very short chapters, each hammering home some low-hanging fruit that your company can snatch.

POSTSCRIPT

In Legendary Service: The Key is to Care (McGraw-Hill, 161 pages, $25.95) legendary fable writer Ken Blanchard, author of The One Minute Manager and other books, teams with colleagues Kathy Cuff and Vicki Halsey to tell a story about a front-line worker who manages to make a difference.

Ottawa career coaches David Booker and Sharon Letovsky provide insights to move up the ladder fast in 7 Steps to Supercharge Your Career (Capricorn Coaching International, 252 pages, $27.10).

Economist Lodewijk Petram takes you back to Amsterdam in the 17th century and the first financial instruments, showing how little we have progressed, in The World’s First Stock Exchange (Columbia Business School Publishing, 296 pages, $29.95).

Harvey Schachter is a Battersea, Ont.-based writer specializing in management issues. He writes Monday Morning Manager and management book reviews for the print edition of Report on Business and an online work-life column Balance. E-mail Harvey Schachter

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