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Simulation-Based Complexity Management
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| Using
intuition or “gut feelings” to make
strategic business decisions can result
in lost earnings potential, unmanageable
complexity and unnecessary risk. This
paper discusses a holistic,
simulation-based approach to
decision-making, which allows companies
to predict the longer-term impact of
every move they make.
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download
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How Much Does Complexity Really Cost? |
Uncontrolled complexity is choking
profits at too many companies. Because
its effects are siloed in seperate
departments, management often fails to
see the relationship between complexity
and costs across the value chain.
Yet a recent A.T. Kearney analysis finds
that companies can increase their EBIT
by 3 to 5 percentage points on
average—if they make systematic,
cross-functional improvements based on
transparent complexity costs.
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Controlling Complexity in the Chemical
Industry |
Major players in the chemical
industry are remaking and updating
product portfolios they have pursued for
decades. Through recent M&A activity,
some companies are increasing their
scale and critical mass, while others,
such as BASF and Dow, are pursuing new,
more customer-focused specialty areas.
These changes have prompted many
chemical companies to take control of
their complexity that can release hidden
earnings potential, in some cases
increasing margins by 2 to 5 percent.
Click here to download |
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The price of complexity in the Chemicals industry
Published in: Nachrichten aus der Chemie,
55, November 2007
Source :
www.gdch.de |
Consolidated
and globalised markets as well as
individualized customer demands
increasingly affect the product- and
customer complexity of Chemical
companies. At the same time these
companies face rising pricing pressure
in an environment, wherein traditional
measures to increase profitability are
already exploited. In this article A.T.
Kearney shows new, intelligent methods
to increase the profitability in a high
pressure environment.
Click here to download (German Publication) |
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The balancing act – between
differentiation & cost-trap
Extract from:
INNOVATIONSMANAGER - Magazin für
Innovationskultur,
Ausgabe 4, 2009
Publisher: F.A.Z.-Institut GmbH,
Frankfurt am Main |
Companies
that desire to differentiate themselves
from their competitors by offering
customized products often face the
problem of increasing product- and
customer complexity. Managing the
downstream production- and
business-processes as well as
distinguishing between “good” and “bad”
complexity becomes crucial, as “bad”
complexity is not paid by the customers
and causes negative effects on company’s
profitability.
Click here to download (German
Publication) |
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Products without profit
Published in: Handelsblatt, 2.9.2007 |
More and more companies lower their overall profits by introducing an unmanageable range of products. The only question is: Does this complexity really pay off for the manufacturers? Often not even the management knows the answer. Internal “silo-thinking” and complex matrix structures impede transparency and clear decisions.
© Handelsblatt GmbH. All rights reserved.
Click here to read the full article
(German article)
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Untangling Product Complexity in M&A |
29th May, 2009: M&A is a powerful
instrument that can be used to gain
access to complementary technology,
channels and other critical assets
without the risks or travails of organic
growth. One downside is that
acquisitions often result in product
complexity. Successfully managing the
complexity of a newly combined product
portfolio can capture value, smooth the
overall merger process, and deliver the
full promise of M&A.
Click here to download |
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Cultivating Smart Complexity |
For generations, as consumers
seemingly thirsted for exciting new
products, manufacturers happily provided
more choices, cementing the "more is
more" mindset. Now, there is awareness
that perhaps we went overboard, as
consumers do not reward, and
occasionally reject, too many choices
and the increased complexity. The need
then is to differentiate good complexity
from bad—isolate and eliminate the
weeds—and cultivate smart complexity
that truly wins.
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| For more publications on
Complexity Management access the full
Complexity Management publications section. |
