How the whole need not be bigger than sum of parts

There is a saying attributed to Aristotle which goes as following “ the whole is greater than the sum of its parts”.
Essentially what this implies is what we call the synergy effect. i.e. 1+1>2. Does this usually happen this way?
Let’s take the example of an organization.

Let’s say there are various departments such as Planning, Procurement, Production, Warehouse, Logistics, Sales.
Which are 6 departments? We are not considering the support functions such as HR, Fin, Admin etc as this is only for illustration purpose.
Now suppose each department works at 90% productivity.

Which means let’s say the Planning Department is working at 90% productivity.
Same with each of the other departments. Procurement gives out only 90% to Production which further gives out 90% to warehouse etc etc.

Now effectively the overall productivity of the entire company looks like this: 90%*90%*90%*90%*90%*90% = 53.14%.
Which basically means that even if each of the departments are working at 90% productivity,
the end result could be drastically far away from the company’s goal.

Usually, this happens due to the silo focus of the executives and not enough time and focus from the top management.
CashOS is a technology which is simple, yet powerful in helping the top executives to get an overall perspective of the company
and take decisions accordingly.

Would you like to know how CashOS can help you?
Reach out to us at info@CashOS.com

Founder & CEO
Written on 16th October 2018

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