LITMIR.BIZ

      Enjoy reading about profitable growth solutions.

      PART I

      8020 Focus and

      No distraction

       1 – 8020 Focus and No distraction

      Doing a successful and result-oriented job is not as easy as it seems. In 1999, I was stunned by the productivity level and focus of my work colleague at a bank in the South of Germany. Mrs. Muller, a trusted and long-time employee in that bank, was scanning and double checking all high-income transfer receipts. I noticed two aspects at the same time, there were many zeros on each receipt and there were only a few receipts scanned compared to the amount of numerous boxes of thousands of documents. I was confronted the first time with the 8020 concept. All of the high and important transfers were taken into account whereas the majority of transfers weren't included by Mrs. Muller. She only focused on the most important transfers. But as a matter of fact the real lessons learned from her was her focus on time and to deliver her tasks each day in 8 hours because she had a 40 hours week. Every day she performed and there was zero distraction to do what she had to do on her 8 hour-workday. She was delivering concentrated value by simply doing what she was supposed to do.

      Sounds like a normal working performance. But, there is one common mistake I see day by day in the numerous offices I visit.

      Employees are very often “just not” doing what they are supposed to do.

      And even worse, their boss, the CEO, is very often neither doing what he/she is supposed to be doing.

      They are trapped in the daily business and the incoming operative problems, mails, social media and non-strategic tasks. They are busier with efficiency than with effectiveness. Doing the right things versus doing things right.

       CEO challenge

      The key challenge for a CEO is to manage that he/she and importantly his/her team are focusing and executing on the right things each day. And that doing the right things impact financially on profitable growth. CEOs have to define where the company will be in 2 years and not take part in each single decision which his or her managers are responsible for.

      CEOs have to define the long-term vision and the fundamental business model elements (for instance closing constant deals with their key account, developing and hiring an outstanding sales team, defining a required service level or establishing a best in class business practice or process) that provide the company a competitive advantage and generate financial value.

      CEOs are responsible for the strategy.

      Strategy is a synonym for renunciation. To focus, CEOs have to trade off.

       How much time do you spent each day on operational issues?

       How much of your time are you in the 8020 zone?

      In 1906, Vilfredo Pareto noted that 20% of the population in Italy owned 80% of the property. He proposed that this ratio could be found continuously in the physical world and theorized it might indicate a natural law. For business, we know that in most cases the 8020 rule comes true:

      o 80% of work is completed by 20% of your team.

      o 20% of your best clients (or customer segment) makes 80% of your sales.

      o 20% of your products makes 80% of your sales.

      o 20% of your best sales reps makes 80% of your sales.

      o 80% of your complaints come from 20% of your customers.

      o 80% of value is achieved with the first 20% of effort.

      o 80% of project politics come from 20% of your stakeholders.

      o 80% of problems originate with 20% of projects.

      o 80% of software problems are caused by 20% of bugs.

      o 80% of customers only use 20% of software features.