What is the main obstacle to the growth of your organisation?
Our is “The culture of Italian companies is still far from the innovative services offered by Foxwin”.
We discovered this by applying two famous theories to a concrete case: our organisation.
If you want to find out how we figured it out, I invite you to continue reading the following article.
The Theory of constraints was created by Eliyahu M. Goldratt, an Israeli management guru. The theory has been used by Goldratt and his collaborators for more than 30 years in numerous companies and has been impressively successful. The success is due to the fact that it has helped companies focus on one obstacle at a time. Untangling the most important constraint has allowed them to take the best action to accelerate growth and business performance.
While the results that applying the theory promises are fascinating, it also immediately challenges us. What is more, it forces us to ask questions that may seem uncomfortable:
What are the obstacles in my organisation?
Or
How many obstacles hinder the growth of my organisation?
Or even better:
How do I know which obstacle is the most important?
Curiosity in our case was greater than fear, so we chose to ask our shareholders and the answers we received left us stunned.
Driving the growth of your organisation
In order to speed up the process of exploring the obstacles and identifying the most important one, we decided to get help from a second theory and state-of-the-art software. The Wisdom of Crowds theory tells us that, if certain requirements are met, the aggregation of answers from people who are inexperienced, but who know the subject, can provide a better solution than any expert.
The Wisdom of Crowds
The theory says that for a crowd to be intelligent, it must fulfil the following conditions:
- Independence: Each person must respond independently without being influenced by the responses of others.
- Diversity of opinion: people must be heterogeneous, i.e. of different types, skills or roles
- Decentralisation: each person must have at least part of the information and there must be no one in charge from above.
- Aggregation: answers must be able to be aggregated.
The theory also tells us that the greater the number of people involved, the more accurate their collective response will be.
A practical (and quick) application
Knowing these two theories, we decided to use Fennec, a tool that allows you to ask a question to potentially dozens of people and aggregate the answers. The question was very simple, and could only be the following: “In your opinion, what is the main obstacle to Foxwin’s growth?”
We sent it to 60 people who know us quite well. Respecting the principle of diversity of opinion, we chose them from the following types:
- Company members
- Customers
- Internal collaborators
- Business network
- Friends and relatives
- Partners
We collected 27 responses in one week, aggregated them and found 9 distinct obstacles:
- You have devoted little time and energy to nurturing relationships with new players who could bring wealth and value to the organisation
- Lack of commercial drive
- Lack of established customers
- None of the business models practised to date (tech product vs. consultancy services) have proved economically viable
- Products or services are proposed that do not respond to explicit needs
- Communication of services and dissemination of the philosophy is not very effective
- The culture of Italian companies is still far removed from the innovative services offered by Foxwin
- The inexperience and inability of Foxwin’s management to administer the company
- Italian SMEs have little inclination to purchase new software
Am I wrong or do some points sound familiar?
The theory of constraints
In the first part of the experiment, we explored and discovered how many and what are the main obstacles that limit the growth of our organization.
In the second phase we wanted to understand which of these was the most important to address at this time. We wanted to understand which critical issue to solve to bring the greatest benefit. To do this, we created a new survey asking people to bet 10 tokens on the answers they thought were most relevant.
After a week, we finally figured out what was the most important obstacle (or constraint) to our organization’s growth. The answer “The culture of Italian companies is still far from the innovative services offered by Foxwin” had collected 52 tokens, well above the second and third podium that had collected 31 and 30, respectively.
Results
This experiment highlighted a theme that is not unfamiliar to us, the founders of Foxwin. It made us realize that we need to address it as a priority obstacle. We have already set to work creating new services that are better suited to the needs that Italian companies are experiencing right now, and we are revising our communication (a new updated website with new services will be released soon).In addition, after only one month from this internal test we replicated the procedure with 4 new companies through a Check-Up that helps you map the main limits to your organization’s growth.
If you would like to learn more about this experiment or perhaps apply it within your organization schedule a short call with me and I will gladly talk to you about it!
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