Introduction
“Move on…”
In our personal life we have heard and given this suggestion several times. Although it’s kind of easy to say and hard to do, it works like magic in failed relationships and businesses alike!
I will leave the ‘failed relationship’ part for ‘relationship advice’ blogs, here we will concentrate on how moving on can benefit your business in several ways. Famous educator, business consultant and author Peter Drucker have given us some major moving on goals through his ‘Organized Abandonment’ theory. Known as ‘father of management’, Drucker mentioned:
“The first step in a growth policy is not to decide where and how to grow. It is to decide what to abandon. In order to grow, a business must have a systematic policy to get rid of the outgrown, the obsolete, and the unproductive.”
In this case study, I will walk you through the theory of Planned Abandonment and why it is necessary for the growth of your business.
Planned Abandonment
Drucker found that regular and systematic abandonment created a clear path to freedom, creativity, and production in the complicated and frequently chaotic environment of an organization. Drucker’s understanding of human nature is especially remarkable; he saw that people are frequently unwilling to own up to their errors or confess defeat. There is a propensity to hope that circumstances would somehow turn a difficult position into a positive one rather than accepting the facts. This denial of reality is a frequent roadblock to advancement and can impede an organization’s capacity for expansion and development. In his own words:
”…The first policy, and the foundation for all others is to abandon yesterday. The first need is to free resources from being committed to maintaining what no longer contributes to performance, and no longer produces results. In fact, it is not possible to create tomorrow unless one first sloughs off yesterday. To maintain yesterday is always extremely difficult and time consuming. To maintain yesterday always commits the institution’s scarcest and most valuable resources, and above all its ablest people, to non-results. Yet, to do anything different, let alone to innovate, always runs into unexpected difficulties. It therefore always demands leadership by people of high and proven ability. And if these people are committed to maintaining yesterday, they are simply not available to create tomorrow. The first change policy, therefore, throughout the entire institution, has to be Organized Abandonment…”
Be a Change Leader
The first principle of being a change leader involves the necessity of intentionally letting go of past practices and freeing up resources that are no longer contributing to performance or yielding results. In order to create a better future, it’s important to shed outdated methods and habits. However, implementing change often comes with unforeseen challenges. This is why it’s crucial for leaders to have strong and proven capabilities. A change leader critically evaluates every product, service, project, and procedure, subjecting them to scrutiny and determining whether they should be maintained or discontinued. This evaluation process should be conducted regularly to ensure ongoing improvement.
What Must Be Abandoned?
As mentioned before, we are not good with accepting mistakes and owning failures, Our very nature is to keep latching on old practices with a sheer confidence that “…this time it will work”. Instead of this self-harming approach you need to think about abandonment like a change leader will do.
1. It is advisable to discontinue a product, service, market, or process if it still has a few good years of life left, especially when considering factors such as technological advancements, changing consumer preferences, and market trends.
2. Discontinuation is the right decision if the only reason to keep a product, service, market, or process is that it’s already paid for, without taking into account its relevance, competitiveness, or alignment with the company’s long-term goals.
3. Abandoning the old and declining product, service, market, or process is the right decision if its maintenance is hindering the growth of a new and thriving product, service, market, or process, leading to missed opportunities, resource allocation issues, and a lack of focus on innovation and development.
Conclusion
In conclusion, while letting go can be difficult, Peter Drucker’s theory of Organized Abandonment demonstrates that strategically abandoning outdated practices and unproductive areas of your business is essential for growth. By critically evaluating products, services, and processes, businesses can free up resources, foster innovation, and position themselves for future success. Remember, sometimes the best way to move forward is to shed the past.
