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Synergy in Business

Published February 24, 2017
Countries: USA
Age Levels: 12 and up

Synergy is the creation of a whole that is greater than the sum of its parts. It comes from the Greek word synergia which carries the rough meaning of “working together.” A physical synergy can be observed when two pieces of wood are glued together. The new piece will hold more total weight than the sum of the weight each could hold separately. When you communicate synergistically, you open your mind and heart and expressions to new possibilities/new alternatives/new options. When two or more people or organizations combine their efforts, they can accomplish more together than if you added their accomplishments achieved separately. When individuals work together in harmony they make a positive synergy. Visualization in math of this synergy might look like 2 + 2 = 5.

A negative synergy can also exist. If one or more of the parties involved in attempting to work together fails to do his or her part. A negative result can be seen. The math picture for this might look like 2 + 2 = 3. One should avoid collaborations that result in negative synergy.

Story: A young boy wanted to earn money to purchase something that he wanted a lot. His father gave him the job of removing a huge stone that sat in their back yard. The stone had been there since the family had moved into the house. Now the stone sat where mother wanted her new garden.

The boy accepted the challenge from his father. First, he pulled at the rock. It did not move. Next, he pushed on the rock. It did not move. He took a shovel and dug all around the rock. He pushed and shoved with no success. He remembered his lessons from school and tried to use the shovel as a lever to move the rock. He could not move it. Being young and frustrated, he saw the task as impossible. He sat down and began to try.

The boy’s father came out to observe his son at work. Leadership always should observe and prepared to assist management, just as management observes, coordinates and structures the efforts of the workers. “Why have you not moved the rock?” the boy’s father asked.

“I can’t do it,” said the boy. “The job is impossible. I have tried EVERYTHING!”

“You have not tried everything,” said the father. “You nave not asked for my help.” The father told the boy he had been smart to dig around the rock and to use the level. You were also wise to try to use the shovel as a lever. The father quoted the famous Greek mathematician Archimedes who said, “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.” Then the father sent the boy to get a long hard piece of wood and a smaller rock. Together they tool the long piece of wood and laid it across the smaller rock, using it as a long lever. Their combined weight lifted the rock out of the hole, where it rolled down and across the back yard to a place where it was out of the area where mother wanted her garden. The two had developed a synergy. By working together they accomplished a goal that neither could have likely achieved alone.

Examples of synergies in business: The term merger is often used in business. One company may have an excellent product. But, it may not have the capability to effectively market the product. Another may be wonderful at marketing and not have a strong product line to sell. By merging or joining together, they can make and sell products to achieve more than either could separately.

A company can reorganize its own structure to maintain synergy. Honda Motors looked hard at the way they were making cars. After doing a great deal of internal research, they found they were duplicating a lot of efforts across the country. Many car factories were duplicating each other’s efforts. Many had extra tools and supplies they did not need. Others did not have what they needed and continually bought what the needed, often at inflated prices. No common inventory existed for the separate factories to get the materials they needed from other factories within the parent company. When the right tools or parts were not available, costly delays took place. Production lines were slowed. When the tools and supply parts of the factories worked together to build a data base that all could use, Honda found a way to reduce millions of dollars in costs of creating Honda vehicles and had fewer delays in making cars than when they could not put the tools and supplies in the right places where they were needed. Honda used synergy to improve its production and save money.

Synergies can increase capacity, reduce waste, build more positive internal attitudes within organizations, improve teamwork and so on. By working together parties can accomplish far more than by working in a non-harmonious manner.