Departmental Improvements Can Hurt the Whole Organization

Sometimes, what looks like progress within a single department ends up holding the whole organization back. It’s not because people are making bad decisions—in fact, it’s usually the opposite. Talented teams focus on hitting their own KPIs and making local improvements, but without a shared view of the system’s true constraints, local wins can trigger bigger headaches.

Why Local Optimization Backfires

Imagine a manufacturing line where one station becomes twice as efficient. Sounds good—until the downstream processes can’t keep up. Now there’s a pileup. The same thing happens in business: departments get better at their own tasks without considering how it impacts the entire flow.

A few typical examples:

• Sales overbooks implementations: They close deals at a faster rate than the delivery team can handle, leading to onboarding delays and frustrated customers.

• HR fast-tracks hiring: They bring in a wave of new employees without enough onboarding support, resulting in disjointed training and high turnover.

• Production cuts costs: They switch to a cheaper component that saves money short-term, but increases support tickets when customers encounter issues.

Why It Happens

Departments are usually incentivized to optimize their own piece of the puzzle. Sales aims to close deals. HR wants to meet hiring goals. Production looks to trim expenses. But rarely do they pause to ask: “Is this improvement sustainable for the rest of the system?”

A Better Approach: Think Systemically

Start by identifying the primary constraint—the part of your operation that actually limits your ability to deliver value. Then align improvements around that constraint rather than aiming for isolated wins. It might mean slowing down sales or adding onboarding support before ramping up hiring.

Measuring What Matters

Instead of focusing on isolated performance metrics, think in terms of system-wide flow:

• Are we maintaining a smooth transition from one process to the next?

• Are improvements in one area leading to pain elsewhere?

• Are we solving short-term issues at the cost of long-term sustainability?

Shifting Focus from Local Wins to System Success

It’s not just about doing your job well—it’s about doing it in a way that benefits the entire system. A single department’s breakthrough should never create a bottleneck somewhere else. By focusing on system-wide success, teams can avoid creating unintentional slowdowns—and instead, create a culture where local improvements actually improve the whole.