“No” has become the most popular word in most organizations.

Can we try something new? No. Can we rethink a few corporate policies? No. Can we get outside our comfort zone and go for growth? No.

/wp-content/uploads/2014/06/path_482099.jpgIt’s not that leaders don’t want to innovate. Most do. But complexity in all its forms has emerged as the most intractable CEO issue of our time. What was necessary to start great businesses has been suffocated by what was necessary to scale them.

Almost any person in the global workforce can relate to this situation. We all started with a dream to do something in our lives and careers. But over time we became driven not by what’s possible, but rather by what’s doable. Goals became key performance indicators. Inspiration became adaptation. The dream became, well, work.

I remember my earliest days running a small business. I saw my customers every day. Having empathy for their needs wasn’t some exercise; it was my entire business strategy. I had to know them, understand them and serve them beyond their expectations. I didn’t need data scientists to know when new products were needed. Customers told me and I responded.

But now most CEOs have become encircled in layers of management that directly impede this kind of empathy. Instead of seeing customers, we’re stuck playing office – a depressing mix of spreadsheets, presentation slides and seemingly endless conference calls. Some analyst reports I’ve seen say big companies can have up to 20 layers of management. Other experts say best in class companies have 7 layers.

From my standpoint, organizations shouldn’t be structured like onions and it shouldn’t make us cry when we try to pull them apart.

What’s worse? Complexity is only getting worse. Research from Bain, the Economist and others paints a gloomy picture. Executives say business is becoming more complex and, significantly, no one knows who is accountable for it. 

All this complexity should have been the natural runway for technology. But candidly, the CEOs I speak with tell me they have too many disparate applications from too many different technology companies. The applications don’t integrate and exacerbate the silos that have been built up over time. Leaders see technology as an ally, but they aren’t interested in the buzzwords that dominate the IT industry today – they only make an already complex situation worse.

So the question is, “haven’t we had enough?” Are we ready to fight back against complexity?

The way forward in this fight is for leaders to focus on running simple.

Published reports show consumers are 75% more likely to recommend brands that offer simple. A significant percentage of those consumers said they’d even pay more for simple. And simple companies have been rewarded by the capital markets, outperforming their peers by 100%. So there is a clear business case.

But running simple is more than a slogan or a business objective. This is an organizing principle that must galvanize CEOs and their teams to cut through the layers and restore growth as the unifying priority. Empathy will line the path to simplifying everything and technology will enable it.

Let’s start where I started thirty years ago: with empathy for the customer. Today we know that customers can do business pretty much however they choose. In person, via phone or on device are all viable options to transact business of almost any kind. So if we want to make customer experiences run simple, why shouldn’t we have the same view of each customer regardless of how they choose to do business? We should and we can. This isn’t about getting e-mail addresses to spam customers with endless marketing gimmicks. It’s about respecting their choices and responding better to their needs.

And why should it be so hard to listen to customers on social networks when it’s so easy for them to talk about their experiences?

Empathy for our colleagues means giving them more than just the promise of a fulfilling career. We have to stop expecting people to waste precious time on insignificant tasks. It shouldn’t take 30 steps and four applications to plan a trip, file an expense report and ask for a few days off. These things should be simple and intuitive so people can invest their time in making the difference they aspire to make.

Empathy for our partners means re-imagining business-to-business collaboration beyond paper invoices. Checks are centuries old by some measures, yet remain the standard vehicle for transactions in some countries. That’s crazy. If we can connect a teenager in Sierra Leone with his friends in the U.S., we should be able to do business in a network, as well. In fact, more than 1.5 million businesses already do.

I run a global company and have put this challenge to my own colleagues. We can’t run simple with new committees, weekly conference calls and requests to complete spreadsheets. We have to embrace what it took to start and forget some of the things we did to scale.

Can we dream again? Yes. Can we innovate? Yes. Can we grow? Yes.

But only if we run simple.


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12 Comments

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  1. Pratik Talwar

    Simplicity can exist in complex environments which are transparent. When any entity in an evironment has a clear visibility and understanding of the operating principles and policies, things automatically become simple.

    When the current operating environment of the organization is chaos free, it will automatically create space for innovation and empathy.

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  2. Krishna Gorrepati

    Couldn’t agree more. One of the first books we were expected to read when I joined Ford was the “The machine that changed the world“. More than any other time, many industries need to adopt the philosophy outlined in the book. Adopting “lean philosophy” is not easy and requires wholesale (almost greenfield approaches) changes to people, processes and definition of results and success. Lean philosophy starts with the customer and their real and latent needs and works backwards to satisfy them in the most effective and efficient manner.

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  3. Ahmed Zaheer

    Nice words, but the problem is that SAP changed the word innovation with integration and simplicity with one size fits all application.

    The software itself adds layers and layers of data structures and business procedures that complicates the business even more.

    Another thing, I hardly met someone who fully understand your software, and this is because your training offering is very expensive, one advise is try to learn from Microsoft in this area (Education).

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  4. Audrey Stevenson

    I could not agree more that empathy and simplicity go hand in hand. When you start to focus on the needs of the customer and actively listen to them instead of talking at them based on your own assumptions (as the proverb goes: “God gave us two ears and one mouth for a reason”), you can identify with their goals. This, in turn, leads to clarity of what’s needed to meet them, allowing you to strip away so much convolution built up around the old assumptions.

    I believe that SAP’s One Digital Experience project, introduced by Maggie Fox in this minute-long video, is a great example of SAP turning the customer’s goal into our own. Our customers want to access information about our solutions, and we are working to create a simpler web experience to allow them to do just that: get the information THEY need at the right time.

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  5. Gaurav walia

    Glad to see simplification back as a priority for SAP. Great minds before us have laid the foundations in with their inventions. I believe we are now living in the age of simplification and almost all recent business success stories are really about simplification – Apple & Google being the most obvious examples. So in a sense simplification really is one of the most important aspects of innovation.

    Most companies look at simplification from the customer perspective but Bill nicely conveys that it really is something that needs to be approached from multiple perpectives – Customers, Partners and equally importantly Employees. I think simplification is really a matrix of the three perspectives and a number of levels as the other dimension of the matirx. Every organization needs to build its own unique matirx. Organizations that check most of the boxes of the matrix will line themselves up for glory.

    SAP is doing great work in the Customer space with products like Fiori and SAP Netweaver Gateway, I personally would like to see a more co-ordinated approach in the Parnter space. I know SAP does a lot of work on that front but the communication often does not reach the right audience. I’d like to see more efforts to encourage new partners and niche players. On the employee front, I can only speak from my past experience that SAP is truly a role model and I am sure it will continue to be a leader with Bill thinking about it.

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  6. Jansi Rani Murugesan

    Empathy indeed helps to understand the core customer pain points , once identified, realized as our own,rooted the correct path, drilled our Lean approach towards the path surely leads to simplicity… had seen many!

    Looking much forward for SAP’s on their new mission.

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  7. Urs Peter Fischer

    The other important direction is effectiveness instead of efficiency, as it does not really help to efficiently do the wrong things. Also here a lean approach and a passion for customer value creation will be the prerequisite for success.

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  8. Terry Brown

    Excellent view of present day business. Organizations need to empower their associates to ask ‘why’.  Many times unchecked directions taken by silos within organizations lead to complexities that are often times very difficult to reverse.

    Clear simple direction must come from the top and must be enforceable.

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  9. Naveen Vishal

    Great Thoughts !

    Open-up and Stay Simple is the key to progress and staying ahead of competition.

    As complexity increasing by time, one really have to push hard for keeping the things simple.

    SAP had done it previously and so do this time, will Keep-it-Simple for customers and consumers, putting them in win-win situation at last.


    Regards,

    Naveen

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  10. Sven Schmid

    this concept or those thoughts shouldn’t be new. All developers have heard about KISS, all manager should have heard about fighting complexity. But with concentrating on KPIs or Performance Reviews you will always loose the view over the edge. Even in a military context I saw approaches to break through existing boundaries. But from my point of view they failed as most of business managers do. Maybe it is less courage or fear of leaving the comfort zone…

    Btw – many years ago I heard about a company, which promised to deliver 80% solutions – in 20% of time compared to “traditional solutions”. They were pretty successful…

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