Quick Answer
For search, voice, and "just tell me what to do".
The '50% cut' exercise forces clarity: if you had to eliminate half your products, customers, or activities, which would you keep? AI analyzes profitability, growth potential, and strategic fit to identify your true highest-value elements.
Key Takeaways:
- Constraint reveals priority in ways abundance hides
- AI calculates true contribution often masked by aggregation
- Most businesses have significant drag they could eliminate
- Simplification often increases profit more than addition
Playbook
List all products/services, customers, and activities
Use AI to calculate true profit contribution for each
Rank by contribution, growth trajectory, and strategic fit
Identify your top 50% in each category
Examine what you'd lose and what you'd gain by cutting the rest
Consider implementing cuts even without forced necessity
Use exercise regularly to prevent complexity creep
Common Pitfalls
- Keeping low-margin offerings for 'strategic' reasons without testing
- Emotional attachment to products/customers that don't contribute
- Spreading attention too thin across too many priorities
- Adding without subtracting until complexity kills efficiency
Metrics to Track
Revenue concentration (top 20% of customers as % of total)
Profit per product/service line
Time allocation vs profit contribution alignment
Complexity cost (overhead per product line)
FAQ
How do I identify what to cut?
Calculate true profit contribution for each product/customer/activity. Include all costs, including your time. The bottom performers are cut candidates, unless they have strategic value you can quantify.
What if I'm emotionally attached to things I should cut?
Separate the decision from the execution. First, identify what should theoretically be cut based on data. Then decide if emotional/strategic factors justify overriding the data. Don't let emotion skip the analysis.
How often should I run this exercise?
Annually at minimum. Quarterly during growth phases when complexity tends to accumulate. Immediately when facing pressure on margins, time, or cash flow.
Related Reading
Next: browse the hub or explore AI Operations.