How Important Is the Black Hole in Your Organization

There are three basic areas of concern for a Chief Executive – the long‐term future of the organization, how to satisfy all the customers over that long term, and how to do so at the lowest possible cost. These areas interact with each other and if plotted as a triangular diagram, illustrate the “black hole” in an organization which absorbs money, effort and resources without contributing to the organization’s success or long‐term viability. Frequently this equates to 20 per cent or more of sales income or operating costs. The size and scope of the black hole is the scope for a Chief Executive to improve the effectiveness and efficiency of his/her organization, coupled with a detailed plan to reduce it by specific measures to ensure customers’ requirements.