Anyone who has visited a supermarket or mass merchandiser recently has an appreciation for the explosion in the variety of products being offered for sale. Consumer product manufacturers have added brands, extended lines and altered pack sizes, shapes and colors to lure consumer dollars. In introducing these new products and variants, companies have made their businesses more complex.
Designing, marketing, forecasting, pricing, producing and distributing a growing legion of unique SKUs drives up cost, increases the risk of lost sales and dilutes management attention. Add to this the uncertainties about why, when and how to add a new item or prune the existing line, and the complexity challenge balloons even further.
The Complexity Challenge shares the results of A.T. Kearney’s research study of complexity in the consumer products industry. Our findings? Increased complexity is almost inevitable as companies pursue business growth. Tomorrow’s focus must be on complexity management, not simply complexity reduction. And there are strategic steps a company can take in order to effectively manage complexity.