Rethink

Rethink: A Business Manifesto for Cutting Costs and Boosting Innovation by Ric Merrifield

About the Author

Ric Merrifield is a renowned consultant and business architect who has spent over a decade helping organizations redefine and achieve their goals. With a career that spans numerous industries, Merrifield has dedicated more than 10,000 hours as a business architect at Microsoft and has filed 12 patent applications. His insights are grounded in practical experience and a deep understanding of business operations. Merrifield co-authored the influential article "The Next Revolution in Productivity" in the June 2008 issue of the Harvard Business Review, and his book "Rethink" builds on these foundational ideas.

Main Idea

The central premise of "Rethink" is to encourage business leaders to move beyond the "how" trap—focusing narrowly on the methods and processes of their operations—and instead concentrate on the "what"—the fundamental outcomes and goals that truly drive their success. Merrifield argues that by shifting attention to the "whats," businesses can unlock innovative ways to cut costs, boost efficiency, and enhance profitability. This rethinking allows companies to identify hidden sources of value and make informed decisions about outsourcing, automation, and restructuring.

Table of Contents

1. Introduction
2. How the 'How' is Trapping You
3. Escaping the 'How' Trap
4. Focus on Outcomes
5. The Thinking Behind Rethinking
6. Identify the 'Whats' that are Truly Valuable
7. Know What You Are (And Aren't) Good At
8. Make (And Break) Connections
9. Understand What Can (And Can't) Be Predicted
10. Unravel (And Follow) the Rules
11. Case Studies in Rethinking
12. Conclusion

Introduction

In the introduction, Merrifield sets the stage for a transformative approach to business management. He challenges the conventional wisdom that prioritizes efficiency and cost-cutting above all else. Instead, he proposes a paradigm shift towards understanding and optimizing the "whats"—the essential outcomes that define a company's success. This shift, he argues, is crucial in an era where businesses must adapt rapidly to changing technologies, market conditions, and customer expectations.

How the 'How' is Trapping You

Merrifield begins by illustrating how businesses often fall into the "how" trap. He uses the example of Home Depot under the leadership of Robert L. Nardelli. Despite significant increases in revenue and efficiency, Nardelli's focus on cost-cutting and process improvement nearly destroyed the company's customer-friendly environment. As a result, Home Depot's customer satisfaction plummeted, and its stock stagnated, while rival Lowe's thrived by maintaining a focus on customer service.

"Leaders tend to devote their energies to thinking about the details, thereby missing the big picture." - Ric Merrifield

This example underscores the danger of becoming overly fixated on the mechanics of how work is done at the expense of understanding and delivering on what really matters to customers and stakeholders. The "how" trap can lead to a loss of competitive advantage and ultimately harm the business.

Escaping the 'How' Trap

To escape the "how" trap, Merrifield advises businesses to reframe their operations by identifying and focusing on the "whats." This involves creating a clear and objective view of the company's essential activities and evaluating their true contribution to overall success. By doing so, leaders can make informed decisions about which processes to improve, automate, outsource, or eliminate.