Part Six: Launching Yourself on the Critical Path

Well, now it’s all up to you. By now, you should have a critical path mindset. You know what the critical path is and why it is important. You understand the importance of your customers and how to focus on them. You have a good feel for all the ways organizations can get off the critical path. You can use the organizational levers from performance evaluations to reward systems to your advantage. Finally, you understand how you can use the critical path to drive your own decisions as a member of an organization.

Part Six looks at how you get on the critical path—what you should know and what you should do. In particular, it distinguishes between what work matters to the critical path and what work doesn’t. Then it offers practical strategies, with techniques to try out today and questions you can ask yourself right now, to help you stay on the critical path, even when forces are trying to pull you off.

Lesson 60: What Every Employee Should Know about the Critical Path

It’s up to you if you want to be a major player on the critical path. To do so, use the guide below which was summarized from the first four parts of the book to gather current knowledge of the following:

  1. Customer knowledge

    1. Who are you top five customers or customer segments by:

      1. Revenues?

      2. Profits?

    2. What percent of your revenues and profits do these top 5 customers or customer segments represent?

    3. What drives these customers to buy from you rather than other suppliers, i.e., your competitors?

    4. What is their “Net Promoter Score”?

      1. How satisfied are your customers?

      2. How much repeat business do you get from your customers?

      3. Are you getting an increasing share of their spending compared to the other suppliers?

      4. How many new customers do they refer to you?

    5. Which customers do you value the most?

    6. What are the “sacrifice” gaps in product performance, service, time efficiency, or human interactions that your desired customers would like to see eliminated?

  2. Critical path operations knowledge

    1. What does your customer actually experience (physically, mentally, emotionally, socially) when they do business with your company?

    2. What are the actual steps and points of contact between deciding to place an order with your company and the consumption of that purchased good or service? Can you draw this out in a flow chart?

    3. Where do you and your department fit into this flow?

    4. Where do your suppliers and any contracted outsourcing fit into this flow?

    5. What are the “points of pain/pleasure” for the customer in each step of their interactions with you company, your department, and you?

    6. Where are the obvious points of improvement, i.e., the easy, low-hanging fruit?

  3. Market knowledge

    1. What is the size of the customer market for your product(s)/service(s)?

    2. Who are the top competitors in the market?

    3. What is your share of the market and that of your top competitors?

    4. Is the market growing?

    5. How much of the market growth are you getting vs. your top competitors?

    6. What could disrupt the market?

    7. How could you disrupt the market?

  4. Competitor knowledge

    1. Who are your top competitors for the customers that you want?

    2. Why do your desired customers buy from your top competitors?

    3. Which customers do your competitors value the most?

    4. What would it take to dislodge your desired customers from your competitors?

    5. What new competitors have entered the market and what is their threat to you?

    6. What disruptive competitors could enter your market and what effects would they have?

    7. What is the financial position and health of your top competitors? Does this provide a strategic opportunity?

  5. Company financials

    1. Revenues by product/service/customer segment/geography/etc.

    2. Costs by product/service/customer segment/geography/etc.

    3. Activity Based Costs by function/department/etc.

    4. Profitability by product/service/customer segment/geography/etc.

    5. Growth/decline in revenues, costs and profits over last year, 3 years, and 5 years? (Compounded Annual Growth Rate (CAGR))

    6. Lifetime value of a customer?

    7. Share of your customer’s wallet compared to your competitors?

  6. Shareholder knowledge

    1. If publicly traded, what is Wall Street’s assessment of you and your top competitors?

    2. What is your market cap compared to your top competitors?

    3. What is your stock growth/decline compared to your top competitors, your industry segment, and the overall market?

    4. How would a hedge fund or private equity firm look at you and your top competitors? What changes would they make to either you or your competitors to make each of you more profitable?

  7. CEO Perspective

    1. If you were the CEO, what changes would you make to improve the critical path to your customers?

      1. Changes to your customer base?

      2. Changes to your products/services?

      3. Changes in your operations?

    2. Changes to the company?

      1. Changes to your strategy?

      2. Changes to your workforce?

      3. Changes to your hiring, performance evaluation, reward system, culture, and/or organizational structure?

Critical Path Action Items

  • What pieces of the critical path knowledge above do you know about your organization?

  • How can you go about learning the information you are missing?

  • How can you use the information to add more value to your company’s critical path?

  • What opportunities do you see to improve the critical path?