The Basic Math(s) Approach to Business Success

Today, let’s discuss the basic maths approach to business success.  I am writing from Sydney, I use the term maths.  If you are in North America, there we say, math.  I use the terms interchangeably in life and writing.  Concepts as simple as the equal sign, and order of operations as simple as addition and subtraction are powerful tools of logic to build extraordinary business success.  Here’s how this works.  Now, all you adults who hated maths as kids, stay with me!

We are going to learn how two basic formulas can lead to a business reinventing itself.  Reinvention is a group of people realising more of its potential, and growing extraordinary sales and profits. Our basic math lesson today will lead you to separate yourself from what is currently holding you back.  It will cause you to change your direction leading to joining yourself to new choices, expanded opportunities, options, and possibilities.  Potential and reinvention separate (a maths concept) from outdated habits, routines, roles, and mindsets.  This leads to being all you as an individual and company are capable of.  These symbols are worth millions of dollars of proven business success:

P + R = EC  or Potential + Reinvention = Extraordinary company
EC = ECx or Extraordinary company = Extraordinary customer experience

Basic Maths: Joining and Separating 

At a very early age, normally first grade, school children solve numerous joining and separating situations with mathematical tools.  Let’s understand joining and separating first.  Joining problems are where the action is a joining of two or more quantities (like 6 toy cars and 18 more toy cars are joined to the original 6).The opposite of joining is separating. In many word problems the action involves separation of quantities.

Louise has 36 cookies and gives 12 to Henry (12 cookies are separated from the original quantity of 36). As with Join problems, there are three distinct quantities in Separate problems. There is a starting quantity, a change quantity (the amount removed), and the result. Any one of these quantities can be the unknown.

Five apples were on the table. I ate some apples. Then there were 3 apples. How many apples did I eat?

Student A: What goes with 3 to make 5? 3 and 2 is 5. So, 2 apples were eaten.

Student B: Five, four, three (holding up 1 finger for each count). 2 apples were eaten (showing 2 fingers).

Student C: We ended with 3 apples. Three, four, five (holding up 1 finger for each count). 2 apples were eaten (showing 2 fingers).

So let’s understand this before we apply it to business.   Students in kindergarten are required to, “Represent addition and subtraction with objects, fingers, mental images, drawings, sounds (e.g., claps), acting out situations, verbal explanations, expressions, or equations.” They are also required to, “Solve addition and subtraction word problems, and add and subtract within 10, e.g., by using objects or drawings to represent the problem.”

Application to Business:

We use the basic maths of join and separate all the time.  We have a team of senior managers, and HR is seeking to join (add) another manager.  Making a change to the original manager formula is meant to produce a greater result.  The opposite also happens. A company decides to separate a manager, and change the formula by removing someone from a team or the company. 

In business, problem solving and decision making often involve joining, separating, adding, subtracting, and so forth.  Having worked in the food business for a decade, and in product development, building a business is like the research and development that adds and subtracts ingredients which end up as a formula (recipe).  Adding/joining a new product to our portfolio is meant to result in more sales and profits.  Subtracting/separating a product by discontinuing production can also be designed to bring about a positive change.

Basic Maths: Symbols and Balance

Young students in Kindergarten and First Grade solve numerous joining and separating situations with mathematical tools, rather than symbols as we saw above.  Once the concepts of joining, separating, and “the same amount/quantity as” are developed concretely, First Graders are ready to connect these experiences to the corresponding symbols (+, -, =).

Thus, students learn that the equal sign does not mean “the answer comes next”, but that the symbol signifies an equivalent relationship that the left side ‘has the same value as’ the right side of the equation.

When students understand that an equation needs to “balance,” with equal quantities on both sides of the equal sign, they understand various representations of equations, such as:

● an operation on the left side of the equal sign and the answer on the right side (5 + 8 = 13)
● an operation on the right side of the equal sign and the answer on the left side (13 = 5 + 8)
● numbers on both sides of the equal sign (6 = 6)
● operations on both sides of the equal sign (5 + 2 = 4 + 3).

Once we understand the meaning of the equal sign, they are able to determine if an equation is true (9 = 9) or false (9 = 8).

Basic Maths: The Business of the Equal Sign

How are you and your company doing in the business where you work?  Would you like to add more sales or profits?  Do you need to subtract expense that is not balanced by equally generating revenue?  Does the use of capital match the return on investment? 

Remember, the logic in the numbers always comes down to determining if what we are doing is TRUE or FALSE.  Is it true that the theory of hiring/firing a person, or adding/subtracting a product or service will balance with the equivalent of added return?

This is where I come in.  Here is one basic maths business formula that is foundational to business growth: Extraordinary companies look like this:

P + R = EC, where P is the symbol for potential, R is the symbol for reinvention, and EC is an extraordinary company. 

Potential and reinvention design is the left side of the equal sign. We are seeking to determine whether this equation is true or false. 

So, another simple formula is this:

EC = ECx  where EC is the symbol for extraordinary company, and ECx is the symbol for an extraordinary customer experience.

How I Apply Basic Mathematical Logic to Build Successful Companies

Extraordinary companies lead to extraordinary customer experiences.  The converse is also true.  After 10 years as a company President designing food products, I was no longer content with products alone.  How that happened is my passion in food was designing extraordinary user sensory experiences of our food products–a feast for the senses. 

 So, I personally set up booths in a variety of venues to give away 25,000 loaves of our product to customers and potential customers over two years.  My goal was to to talk to thousands of people about our products.

The experience of watching people who were already customers, and those who were not, eat our product in front of me, triggered more creative ideas.  As I watched people eat our product, I thought about everything and everyone back at the bakery that went into that experience.   I learned that to design extraordinary user experience required me to design an extraordinary company first.

That’s how I discovered an extraordinary company = an extraordinary customer experience. 
EC = ECx.  In my mind, an extraordinary company meant our work environment needed to match the brand we portrayed in the market.  Our buildings, how we did business, how we treated our employees, how we dealt with our stakeholders all needed to be wholesome goodness.  Then, we could bake wholesome goodness into every product we made.  

I decided my greatest capability is designing not just one extraordinary company, but many extraordinary companies. Reinventing ordinary companies to be extraordinary requires designing leadership reinventions and the culture of work—”people like us doing things like this–” as Seth Godin says.  Culture is simple to understand.  It is how you do business, communicate, and treat customers, suppliers, and employees.

From Product Design to Company Design

After spending a decade innovating new products as President of a food company, I decided product design is not enough for me.  Designing extraordinary companies is. 

EC = ECx

Extraordinary customer experiences only flow out of companies that reinvent themselves continually to reach their highest potential. Customers experiencing what I design and being delighted is my peak experience, because it leads to greater return on the cash it takes to build a great company and customer experience.

I cannot express strongly enough, how detrimental silos, turf wars, and egocentricity are in business.  Those behaviours create ordinary or terrible companies.  Those types of businesses produce customer experiences that are ordinary or terrible.  It is that simple.

The Order of Operations When a Company Is Failing Math

The first order of operations in a company that is not producing extraordinary user experiences is to subtract the detrimental from the business.  The type of toxic culture characteristics mentioned above are the enemy becoming a great company producing great customer experiences.  Businesses are rewarded by customers when they provide more value than other choices for the price a customer pays.