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Why the 5 Focusing Steps are so Important

Most middle and senior managers do not understand or simply are not interested in how their business system works. They are content to focus on their local department and optimise that – rather than understanding the business as a whole to cause it to maximise results. Even top management (CEOs) often do not understand their business. They condone and even encourage their management teams to optimise their local departments – production, marketing sales, finance etc. Wherever local optimisation is the rule the business concerned will always harm the bottom line significantly. Local optimisation is a massive mistake!

The 5 Focusing Steps are guidelines that properly used will cause a management team to always reflect on their (local) decisions. Is the action or decision taken locally help or damage the business as a whole? As we will see the 5 Focusing Steps are a guide, but they do not replace a deep understanding of the business system.

What follows is a description of the 5 focusing steps, how to apply them, why each step is important and a series of examples of common practice that violate the 5-Steps. The first step is a discussion on the prerequisites to apply the 5 steps correctly.

The 5 Focusing Steps - The Pre-Requisites

Prerequisites to the application of the 5-Steps

1. Definition of the System: The system to be optimised could be our production (because we know that production is holding back our ability to succeed. It could be the business as a whole including our markets. Care should be taken that the system selection will not lead to local optimisation.
2. Definition of the Goal of the system. If we do not know the goal of our business we will not know how to optimise it – there will be many things that can be improved so that our business will have no focus.
3. We need to know how our business can tell it is approaching the goal. Top management may be able to look at the bottom line, but middle management is operating locally. They need a way to know that their decisions and actions are causing the business as a whole to approach the goal more and more.