Albert Einstein once said something to the effect of, “Everything should be made as simple as possible, but not simpler.”
One has to hand it to Einstein. He had a way of expounding things, which is why scholars coined the term Einstein’s Rule of Simplicity.
Making the Museum, a platform that supports all things archival, says the rule frequently comes up in exhibition planning. In the context of exhibitions, content must be accessible for non-expert visitors. But the content shouldn’t be simplified so much that it’s no longer true or accurate.
The same principle applies to modern business models. Here’s how…
Focus on the Customer
The customer experience must be at the center of everything you do, whether you’re a SaaS software company or an eCommerce store.
Entrepreneur explains that complexity kills efficiency. From purchasing to checkout to after-sales support, you have to nail the buying journey by making it intuitive and requiring minimal effort.
When your customer fails to understand how subscription billing or payments work, you’re on shaky ground. PayPro Global suggests partnering with a global payment processing platform that handles global payments, recurring billing, taxes, and regulations.
Acting as your Merchant of Record (MoR), these platforms offer payment localization and customer support, because a happy customer is a returning customer.
More Agile Operations
Forbes reports that narrowing your focus drives impact. It could look like a refined product or streamlined operations.
The businesses that adopt this psychology are more agile and able to adapt to market shifts. You are better equipped to execute your strategies.
A paper published on Harvard Business Review also notes that reducing product complexity can increase efficiency and customer satisfaction. Learn to cut through the noise, and you’ll improve performance.
Stripping Down the Value Proposition
Sometimes all you have to do is go back to basics. Maybe that’s exactly what your business model lacks.
Strip your company down to its most basic elements, says business coach David Collins. Start with:
- A single phrase that describes the purpose of your business.
- Create clear goals, not too detailed.
- Allow room for flexibility.
Apply the ‘Caveman’ Test. Is your business model simple enough that a “caveman” can instantly grasp what’s in it for them? If you can’t explain your business clearly and simply, you probably don’t understand it as well as you think you do.
Less Noise, More Clarity
The market is saturated with other businesses like yours. But you can’t be everywhere all at once. Stick to the essentials and focus on one or two core strengths.
Like noise, eliminate the clutter by getting rid of products or steps that are no longer needed. Your processes should be robust and user-friendly, so that everyone in your organization can work as a team rather than in silos.
Think of your business model as a physics exam. Concentrate on converting resources (capital) into results (revenue) efficiently.
Avoid Over-Simplification
Yes, just saying it defeats the purpose of this article. However, there’s a huge difference between simplicity and reducing your mission statement to nothingness.
Simplifying is good. Reducing a complex problem too much? Not good. It makes it ineffective. Your business model must roll with the punches and handle the reality of the market.
Pay attention to the “why”. As previously stated, understanding the core purpose of your business is the elixir.
On the other hand, overcomplication is sometimes associated with hiding the truth. The energy sector is guilty of this. Companies are accused of using jargon and trivializing data to fuel climate deception.
Simplicity, in contrast, builds trust.
Optimize for Efficiency
It’s easy to get caught up in the race for revenue. Most founders think that an ROI spells increasing capital spend. What if you turned the focus to efficiently converting capital into revenue?
Simplicity doesn’t entail making things lazy or shallow. It’s understanding the “complexity” and then breaking it down to its most essential elements. Remember, if a solution is made too simple, it loses value.
Here’s another pearl of wisdom to keep in mind. Complex systems are easy to build. They’re also hard to maintain, teach, and scale.
Do. Act. Execute
The best plans are nothing without execution. A strategy without action is merely an idea.
If you want real change, you have to make moves. Sometimes it works. Sometimes it doesn’t. Either way, you learn and adjust for the next step.
Simplifying a business model always carries some risk. You might not go far enough. You might miss the mark. Without action, there’s no feedback. And without feedback, there’s no progress.
So what’s it going to be? The simple route, the oversimplified route, or the complicated route? The answer isn’t that simple, is it?
