From the course: Lean Foundations
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The cost of complexity
From the course: Lean Foundations
The cost of complexity
- [Instructor] Simplicity is the ultimate sophistication, a profound statement from Leonardo da Vinci that has stood the test of time. Nowadays, we would say, less is more. If you take the position that simpler is better, you are certainly aligned with the principles of Lean. For one thing, complexity drives costs within the organization. For example, the Pareto principle indicates that 20% of your products generate 80% of your revenues. So, I complex product portfolio not only drives up product costs, but increases costs for such things as inventory, raw materials and packaging, and also drives the complexity and costs found in your customer base and your markets and the organizational structure needed to support them. On the other hand, too few products in your portfolio, can mean lost opportunities and lost sales. On a continuum between simplicity and complexity, where's the right place for your business to be? That's…
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