Viewing entries in
Part 1
If you or your company do not focus on the critical path, sooner or later, someone will do it for you—with the result that you could be out of a job. So, start thinking like you own the company. Better yet, think like a hedge fund activist who is eyeing your company as a potential takeover target.
Reducing costs and generating revenues are not abstractions or things a company does just to do them. Both actions must be documented carefully, in hard dollars and cents, to determine and verify the effects on the critical path.
The most important side of the critical path in most organizations is the revenue side. You can’t grow a company through cost reductions. You can only do it by increasing revenues. This requires an intense focus on the customer. In this sense, every worker must be working for the customer.
LeBron James is arguably the most famous and popular basketball player in America, perhaps the world. When he first left the Cleveland Cavaliers and headed to the Miami Heat, season tickets for Miami sold out quickly for the next two years.
Support Services include everyone in the organization who is not on the critical path or managing it. These include Accounting, Human Resources, Legal, etc. Their job is to provide tools and services that enable critical path workers to be more productive in the organization’s competitive and regulatory environment.
If you are not directly on the critical path, then you’d better be supporting someone who is on it. After all, as the old saying goes, “If you are not making or selling it, then you’re an expense.” If you want your salary paid, the critical path employees have to generate the money to pay you.
Companies actually have two critical paths: today’s and tomorrow’s. Today’s path deals with meeting current customers’ current needs. Its product is available to customers now, and customers are buying it. This process creates the cash flow and profits that keep the enterprise afloat. It pays the bills and the salaries of the workforce.
The most important thing you can do for yourself and your company is to get on the critical path.
Think about what your organization actually makes or does for your customers. Do you provide them with: Cars? Accounting Services? Electricity? Vegetables? Software? Transportation? Healthcare? Mortgages? Music? The Promise of salvation?
While the concept of the critical path may be simple, there are a number of steps along the way. The critical path consists of all the steps it takes to get your product or service to your organization’s customers. No matter the industry, the path is strikingly similar from organization to organization.
I learned another very important lesson about the critical path while working in our family gas station. In the winters, cars parked outside sometimes had trouble starting during extremely cold temperatures. The batteries just did not have enough energy to start cold engines containing sluggish oil. Throughout the winter, our customers would call us to come jump-start their cars. I’d often be out in the early mornings in minus 20-degree cold jumping car batteries to bring life to those cars.
My high school economics teacher, Mr. Thallamer, assumed that all his students were going to have to work for a living. So, he asked us: “What is a job? What does a job mean to you?”
