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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. Doe 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. This fifth post is a short discussion of the fourth (probably the step that is taken much too soon much too often) of the 5 steps.

The 5 Focusing Steps

Step 4: Elevate (Expand) the Constraint

Many times an organisation will expand resources of a perceived constraint, without deciding how to exploit the constraint or how to cause the rest of the organisation to subordinate to the decision. This is almost always a mistake. It is a mistake because a good decision how to exploit together with proper subordination yields so much capability (capacity) that the expansion is often shown to have been unnecessary. The first 3 focusing steps minimise investment and by delaying it to the proper time when investment is truly necessary.

Also many times the first 3 steps alone will cause the constraint to move (see step 5). A too early expansion of something would therefore be a waste of money. While the 5 steps are not a Lean process they do prevent financial waste whenever they are properly applied.

So, if the constraint has been properly and fully exploited and subordinated to; and it is still the constraint, then it is time to expand it … but only after full exploitation! Usually this will cause the constraint to move to a new place (unless strategically, the company decides to expand in such a way as to maintain the location of the constraint).

Elevate or expansion does not only mean investment in added resources. It means any expenditures made to increase capacity such as overtime, hiring temporary staff, outsourcing and anything else you may think of.