“What people think of as the moment of discovery is really the discovery of the question.” – Jonas Salk
We spend so much of our time as business people looking for answers that we sometimes forget to check if we’re asking the right questions. From my 25 years of working with business leaders there’s one important business question that gets overlooked more than any other. Do you know what it is?
And by not asking it, companies miss enormous opportunities for increasing profits, service, and effectiveness. The good news is that if you’re not asking this question in your business, then you have a lot to gain by reading further. It doesn’t matter what your business is the question is the same.
I’ll give you another minute to think
While you’re thinking, let’s first agree on what makes a question “important” in the first place. For me it’s pretty simple, a question is important if asking and answering it provide significant value to the parties involved. So in the context of your business or your organization, an important question would be one that helps you to understand and manage your business better, or more effectively. Such a question is definitely important in my way of thinking.
The Most Important Question Most People Miss
Now, what is this ‘magic’ question? And more importantly why is it soooo important to ask and answer it? The question is this:
“What is the constraint of my business?”
For those of you who haven’t heard me talk about it before, the definition of a constraint is ‘the thing that limits the business from achieving higher performance in terms of its goal.’ So if the goal of your business is to make money, then the constraint is the one thing that most limits you from making more money. If your goal is something other than money, then substitute that for money in the above statement.
Is this question important? You’re darn right it is. The constraint is what limits the performance of your organization—or said differently, what DETERMINES the performance of your organization. So knowing what your constraint is, is vital to knowing both how your business is doing and what to do to improve performance—your profits!
Knowing the answer matters because if you know what limits your company from improving, you know what to pay attention to, you know where to focus, and you know what to measure. Not asking and answering the question means you are most likely NOT focusing the bulk of your attention and effort on that one most important thing that is holding you back from getting more of your goal. So after knowing the goal of your business, it might be the next most important question.
I have worked with hundreds of companies over the past 25 years and I have asked most of them this question during one of our first conversations. The answers I have gotten can be grouped largely into two categories:
- They don’t know the answer/ blank look/ hmmm that’s a good question…/never asked the question, and
- There is disagreement about the answer among the management team (i.e. we might have asked the question, but haven’t treated it as important enough to really answer)
Either way I think the result is the same—the leadership of the company does not know what limits their business from doing much better. Of course if the leadership, who sit over the whole organization and see all the department and functions, doesn’t know where the constraint is, what is the chance the people below them, who see only a small part of whole system, know what the constraint is?
Very small!
Have you heard the statement: “what gets measured gets done”?
I think it’s pretty true in organizations. What we measure, what we pay attention to, strongly impacts what the people in the organization do, the decisions they make, and how they spend their time.
Clearly, to influence actions and decision-making in our company we want to put a high degree of emphasis on the performance of the constraint—motivating people to reduce this limitation. But if we haven’t asked the question, it’s almost assured that we are not placing the proper focus on this measurement, and we may very well not be measuring it at all.
Would it help if everyone in the organization knew where the constraint of the business was? I think so, and I know it wouldn’t hurt. Yes, many people might not be able to do anything to improve the constraint from where they are in the company. But, they might. And if everyone knew, I am confident you would get a few more ideas and actions that would improve the constraint and a few less bad decisions that negatively impact the constraint.
The value of finding the constraint
What’s real value of asking this question about your company? To me it’s quite simple. If you don’t know the one thing that is limiting your business, that is most holding you back, you are almost certainly not giving it the attention it deserves. Breaking a constraint is not always an easy thing to do, so without a focused, concerted effort to do so, it’s likely your performance will be flat—held down by that constraint.
I sometimes ask my clients: If you had 2 hours a day, for a week to focus only on one thing—to observe it, to analyze it, to talk to people about it and to look for ways to make it better—do you think you could make a significant impact on its performance?”
The answer I always get is, “yes,” usually with a broad smile forming. It’s as if the idea of being able to focus so singularly for even such a short period of time is almost heavenly for them to consider.
Then it passes. “But I never have that kind of time without interruption.” (This might sound familiar…)
So what then do we spend our time on…other things, other things, which by definition are less important, even if they feel more urgent, than working on the constraint?
The Danger of Not Knowing Your Constraint
Let me close with a story from one of my first employers, a manufacturing company, to illustrate the difference.
This company was a sizable business, within a multi-billion dollar conglomerate, and we had a sizable cadre of manufacturing engineers who were tasked to find ways to improve the processes to reduce costs. This group of folks was immensely talented and had tremendous experience and knowledge of the products we made and the processes we employed to manufacture them.
Each year, for the previous several years of the program before I worked there, they managed to come up with innovative ideas to make individual parts of the operation go faster. And each of those years the company calculated several millions of dollars of “savings”.
Yet at the same time the company’s bottom line remained largely the same over the period—it certainly didn’t increase in any way close to the proportion of the savings that they had reported. In other words, in spite of the calculated savings the company claimed, the bottom line had not improved at all. The reason was simple, they were not working on the constraint—because the company hadn’t asked and answered the question.
For years the efforts of these talented, dedicated, and hard-working folks were being wasted speeding up operations that weren’t limiting our performance. What was the impact? During the next two years, after finding our constraint and focusing on it (and the subsequent constraints that resulted from breaking each one) the company increased profits 40%, in spite of slightly lower sales, and reduced capital expenditures by more than $1 million.
So, if you’re tired of spinning your wheels like this in your company, stop and ask “where is our constraint?” before you invest another day in fighting fires.
Do you have a story about finding your constraints, or a cautionary tale about not identifying them? If so, share it with us. Let us know what worked for you and what didn’t, and how it helped you and your business. We’d love to hear it!
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