“Life can be improved by adding, or by subtracting. The world pushes us to add because that benefits them. But the secret is to focus on subtracting.”
- Derek SiversPeople don’t subtract.
Our minds add before even considering taking away.
Don’t believe me?
Leidy Klotz is a Behavioral Science Professor at the University of Virginia and a student of “less”. He conducted a series of experiments that demonstrate people think “more” instead of “less”.
Consider the following diagram and the ask.
Thousands of participants were asked to make the patterns on the left and right side of the dark middle vertical line match each other, with the least number of changes.
There are two best answers. One is to add four shaded blocks on the left and the other is to subtract four shaded blocks on the right.
Only about 15 percent of participants chose to subtract.
Intrigued, Professor Klotz and his research assistants concocted numerous additional experiments to test whether people would add or subtract. They all produced the same result and conclusion – people are addicted to and inclined to add. It wasn’t close.
Big fucking deal, right?
Not so fast. Unfortunately, adding almost always makes things more complicated, polluted, and worse. You’d be better off subtracting.
A great example in supply chain is demand planning.
Demand planning, according to many, is becoming the poster child of adding. Let’s factor in more variables to produce an even more beautiful and voluptuous forecast. Are you sure you all these additional variables will improve the demand plan?
I doubt it.
First, many companies are forecasting what should be calculated. It’s been proven that the farther away from end consumption you’re trying to forecast, the more variables you’ll try to add. And the resulting forecast usually gets worse the more you add – since you’re often adding noise.
We have a retail client that is forecasting consumer demand at the item/store level only and calculating all inventory flows from store to supplier – what we call Flowcasting. Their demand planning process only considers two variables to calculate the baseline forecast:
• the sales history in units
• an indication if the sales was influenced by something abnormal (e.g., like promotions, clearance, out of stock, etc.)
All “other” variables that the “experts” say should be included have been subtracted.
Yet their planning process consistently delivers industry leading daily in-stocks and inventory flows to the store shelf.
The idea is simple, profound, and extremely difficult for us all. For process and solution designs, and pretty much everything, you need to remove what’s unnecessary.
You need to subtract.