Scale: Difference between revisions
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The point where the scale opportunities are large enough to require active management: that is, “passive” scale benefits, that flow from the simple fact of size (eg adding another user to a flat fee all-you-can-eat licence automatically reduces the per-user cost of the licence, without anyone having to do anything) run off at the point where one needs to diverting firm’s resources and personnel towards managing these efficiencies or manufacturing scale efficiencies that don’t arise by themselves (eg negotiating law firm panel arrangements, outsourcing, offshoring). It may engage management consultants, middle managers and eventually a chief operating officer. That unit (call it COO) itself can become so complex that opportunities arise to lever its scale. So consolidating all the diaspora of COO groups into a single function, distinct from operations and the main COO function, and now big enough to have its own COO function. | The point where the scale opportunities are large enough to require active management: that is, “passive” scale benefits, that flow from the simple fact of size (eg adding another user to a flat fee all-you-can-eat licence automatically reduces the per-user cost of the licence, without anyone having to do anything) run off at the point where one needs to diverting firm’s resources and personnel towards managing these efficiencies or manufacturing scale efficiencies that don’t arise by themselves (eg negotiating law firm panel arrangements, outsourcing, offshoring). It may engage management consultants, middle managers and eventually a chief operating officer. That unit (call it COO) itself can become so complex that opportunities arise to lever its scale. So consolidating all the diaspora of COO groups into a single function, distinct from operations and the main COO function, and now big enough to have its own COO function. | ||
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*[[Scale paradox]] | *[[Scale paradox]] | ||
Revision as of 11:36, 18 January 2020
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Risk Anatomy™
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The point where the scale opportunities are large enough to require active management: that is, “passive” scale benefits, that flow from the simple fact of size (eg adding another user to a flat fee all-you-can-eat licence automatically reduces the per-user cost of the licence, without anyone having to do anything) run off at the point where one needs to diverting firm’s resources and personnel towards managing these efficiencies or manufacturing scale efficiencies that don’t arise by themselves (eg negotiating law firm panel arrangements, outsourcing, offshoring). It may engage management consultants, middle managers and eventually a chief operating officer. That unit (call it COO) itself can become so complex that opportunities arise to lever its scale. So consolidating all the diaspora of COO groups into a single function, distinct from operations and the main COO function, and now big enough to have its own COO function.