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Study Your Instructions Carefully Before Launching into Exponential Cost Reductions

Jan 30, 2008
Most people accomplish tasks without looking very far ahead. That approach can be dangerous when making exponential cost reductions. You need a well illuminated road for cost reduction progress before you can proceed rapidly toward you goal.

"It's like driving a car at night. You never see further than your headlights, but you can make the whole trip that way." -- E.L. Doctorow

But you at least need headlights to make a safe, fast trip. Here's why.

A motorist's first trip after dark on a rural French highway was an experience the driver will never forget. During the day, the motorist had enjoyed a delightful jaunt from the country home where he was staying at a famous chateau located about 50 miles away. While at the chateau, the visitor bought tickets for the light and sound show that night and planned to return after dinner at the country home.

Following a lovely meal, the man hopped into his rented car and started off. But he noticed that the headlights seemed awfully dim. Getting out of the car, he was surprised to find that only the parking lights seemed to be functioning.

Since those lamps didn't cast much illumination, he wasn't sure what to do. He fiddled with everything on the dash that looked like it might affect the headlights. Nothing seemed to help.

And there was no instruction manual for the car in the glove compartment. Naturally, he was concerned about trying to travel such a distance with poor visibility.

The moon wasn't up yet either, which didn't help matters. But the motorist really wanted to see the show . . . and he thought, "How bad can it be?"

Assuming that it wouldn't be much worse than driving in fog, he started off slowly. As it became darker, he went even slower.

The road was curvy and there weren't many cars on it to illuminate the route. Naturally, there were no street lights.

At intersections, he would stop to check the road signs to see if he had taken the correct turn. Hours passed and eventually the chateau was reached just in time for the show. The driver was exhausted and a little apprehensive about the return trip.

Just then, the moon came out which cast a lot of light on the scene and the show started. He relaxed.

The performance was great, but now it was quite late and a drive of another 50 miles lay ahead. The car park was full of people, unlike the home where he was staying.

The motorist approached other drivers and told them in sketchy French about his problem with the headlights. Shaking his head, one of the other visitors strode to the rental car and pulled the directional signal back towards the driver.

On popped the headlights! There was no sign on the directional signal to indicate that this was the proper method. You just had to know what to do.

Before leaving the motorist, the Good Samaritan also demonstrated how to put the high beam lights on. In places where there was no oncoming traffic this greater illumination would speed progress further.

The motorist gratefully thanked the man who helped him, hopped in the car, and made the return journey in less than one-third of the time for the latest trip to the chateau. The motorist will always remember that little things do make a big difference in our ability to take high-speed routes!

There's one more point to make about that experience. Gasoline is extremely expensive in France compared to the United States. Cars are designed to operate on less gasoline at higher speeds than at the lowest ones. Because of this, the gasoline on the return trip also cost less than it did on the outbound journey. This is a simple demonstration that you can make faster progress less expensively.

Years later, the motorist returned to France and covered much the same route on the high-speed TGV (Train a Grande Vitesse). The TGV passed speeding cars as if they were standing still. The view was spectacular, the seats were comfortable, and the snacks and beverages were delightful.

Ironically, the TGV was priced the same as the conventional, low-speed train. The only difference in cost was that you had to pay a few francs to reserve a seat on the TGV.

Even more ironically, the TGV was a small percentage of the cost of renting and driving a car or taking an airplane on the same route. Why? The French government wanted to encourage TGV travel so that the technology would develop into an important export. To stimulate demand, travel on the TGV was subsidized.

When they are asked to reduce the costs of using their offerings by more than 95 percent while increasing beneficiary and user benefits, some people feel as though they have been placed on a long winding road in a foreign land at night with only parking lights. But unlike the motorist who had no instruction manual for his rental car, you can go through a careful briefing to give you step-by-step directions for how to achieve this desirable, but challenging, accomplishment by studying the lessons of breakthrough cost reductions.

What are you waiting for?
About the Author
Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantage. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at

http://www.2000percentsolution.com .
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