Cutting costs versus the Tipping Point – trimming fat out of a P&L is something that every organisation periodically feels the need to do. But how far back do you trim? If you hear the ‘clink’ of your knife hitting bone, you’ve probably gone just a bit too far and – tipping point – your customers may start deserting you.

I’m hearing too many stories these days of chaos arising because everything has to work perfectly in order for anything to work at all …

There doesn’t seem to be enough “just in case” built into the “just in time” model. (I am reminded of the Irish supermarket magnate lying on his deathbed telling his family, in all seriousness, that he didn’t want the stores to close on the day of his funeral as a mark of respect – because they were running the operation so close to the wire that they simply couldn’t afford a day’s lost sales.)

So where does that leave you? Well, economists don’t seem to care a whole hell of a lot. Economists and analysts point admiringly at organisations who have managed to trim and trim and trim, but I never hear any mention of the human cost of all of the restructuring, cost containment and downsizing. In my experience, downsizing makes organisations … smaller. Not leaner, smarter, more efficient or competitive; just smaller.

You can’t gun your engine to the red line every time you change gear and expect to get any sort of performance out of your car in the long term. You can’t run your stereo at maximum volume all the time and expect to get any life out of your amp, speakers or ears. So why would a business be any different?

Well, because you can replace defective parts in a business relatively easily. When ‘parts’ become worn out in a business, they either vote with their feet or get downsized as part of some sort of rank-and-yank exercise. The guys at Despair.com may not be the most starry-eyed, positive thinkers you’ll ever meet; but their work – like the manifestly ludicrous behaviour of the Pointy-Haired Boss in the Dilbert cartoon – reflects a reality that all too many people can immediately recognise and empathise with.

Not exactly a perfect world, but experience shows that the people who approach the imperfect world with a clear understanding of how it functions are the people who are much more likely to thrive – or at the very least, survive. Time to get real …