Watch CBSN Live

In Management, Keep it Simple

Occam's Razor essentially says that all things being equal, the simplest solution is the best. The principle has implications in virtually every field of science, not to mention philosophy, aesthetics, marketing, economics, and yes, management.

If for some reason you don't buy the word of a 14th-century Franciscan friar, it might interest you to know that Albert Einstein also believed the universe loves simplicity. I don't know about you, but I'm in no position to argue with the guy.

A great product example is the personal computer. The need for backwards compatibility with legacy programs and interfaces has forever rendered the PC more complex than any of us would like. That's why Apple's iMac has been so successful; it's relatively simple. Not to mention the iPod and iPhone - works of remarkable simplicity.

Some people have a knack for making things more complicated than they need to be. I've found that to be the case particularly when managers make incorrect assumptions and then get intertwined in an endless but futile effort to prove themselves right.

Just look at Yahoo under Jerry Yang versus Carol Bartz. Yang embroiled the company in endless reorganizations and management restructurings, but he could never get it right. Carol Bartz did it once and moved on. Jonathan Schwartz has completed I think 9 restructurings at Sun. The results aren't pretty.

For some folks, simplicity appears effortless. Lou Gerstner executed one of the most challenging turnarounds in business history by reversing the planned disaggregation of IBM and refocusing the company on IT services. His new vision for big blue was brilliant, but it was also simple and elegant, requiring far less restructuring than the previous plan.

Google's founders had great difficulty getting the company off the ground because nobody - not even them - thought search could be a big enough business on its own. Ironically, Yahoo-founder David Filo encouraged them to start a search-engine company. Who thought something so simple could generate so much cash?

In 9 Notable Management Trends (or Fads), you'll notice that simple concepts - such as core competency - have been successful over the long haul, while complex ones - like matrix management (which Yang employed at Yahoo, incidentally) - haven't stood the test of time.

The bottom line is this. In management, keep it simple. And if you find things are getting too complicated, then change your assumptions and try again. All the best things in life are simple. Really.

View CBS News In