Most big companies are optimized inefficiently.

“Optimized inefficiently” sounds like a contradiction until you have watched a Fortune 500 company do it. Every department is optimized. Procurement hit its savings target. Logistics hit its utilization target. Production hit its output target. And the company, as a whole, runs worse every quarter.

Local maxima, global mess

Optimize every silo and you optimize the seams out of existence. Procurement’s cheaper supplier adds two days of variability that production pays for. Production’s long runs hit output targets while burying working capital in inventory logistics now has to store. Everyone’s dashboard is green. The cash conversion cycle is on fire.

A company where every function wins independently is a company that has agreed to lose collectively.

The fix is subtraction

The answer is rarely another initiative. It is fewer, bigger measures that cross the seams — end-to-end lead time, cash conversion, on-time-in-full. Measures a single department cannot game alone force the conversation the org chart was built to avoid.

• Count your KPIs. If it takes two hands, you are optimizing noise.
• Trace one order from purchase to payment and write down every handoff that hurt.
• Pay leaders on the seam metrics, not the silo ones. Watch behavior change in a quarter.