The manufacturing sector is facing a paradox that traditional management approaches cannot solve. On one side, the National Bureau of Economic Research reports that productivity growth in U.S. manufacturing has stagnated in the post-2000 era, with meaningful gains limited to computer-related industries. On the other, the 2024 Mercer Global Talent Trends Study reveals that 82% of employees report being at risk of burnout, meaning the traditional playbook of “work harder, work longer” is no longer viable.
A growing number of manufacturing executives are turning to an unconventional framework that addresses both problems simultaneously: the Karelin Method.
The Speed Gap That’s Separating Winners from Losers
The most telling indicator of which manufacturers will thrive isn’t their technology investment or labor costs—it’s how quickly they make decisions.
Consider the contrast between two industrial equipment manufacturers competing for the same contracts. One responds to quote requests in 24-48 hours. The other takes 7-10 days. Over time, the faster company doesn’t just win more deals, it learns faster, adapts faster, and compounds those advantages quarter after quarter.
This phenomenon, which practitioners call decision velocity, has become the central focus of the Karelin Method, a framework developed by Todd Hagopian, a Fortune 500 executive who has transformed businesses at Berkshire Hathaway, Illinois Tool Works, Whirlpool Corporation, and JBT Marel.
“Most organizations are drowning in data but starving for decisions,” says Hagopian, whose work has generated over $2 billion in shareholder value across multiple corporate turnarounds. “They mistake analysis for progress. The companies pulling ahead aren’t smarter—they’re faster at converting information into action.”
The 70% Rule: What Amazon and Colin Powell Agree On
The decision speed principle underpinning the Karelin Method draws on insights from both military strategy and corporate innovation.
Former Secretary of State Colin Powell advocated for what he called the “40/70 Rule” – make decisions with somewhere between 40% and 70% of the information you wish you had. Below 40%, you’re guessing. Above 70%, you’ve likely waited too long and the opportunity has passed.
Amazon founder Jeff Bezos articulated a similar philosophy in his shareholder letters, arguing that most decisions should be made with about 70% of desired information. Waiting for 90% certainty, he suggested, typically means moving too slowly in fast-changing markets.
The Karelin Method operationalizes these principles through structured decision architecture: explicit decision rights that eliminate committee delays, weekly alignment sessions focused on decisions rather than status updates, and 4-week maximum pilot cycles that force rapid experimentation.
Organizations implementing this approach typically see decision cycle times drop by 75-85% within the first 60 days, before any other changes take effect.
The Multiplication Effect: How Modest Changes Create Transformational Results
What distinguishes the Karelin Method from conventional productivity initiatives is its mathematical structure. Rather than demanding heroic effort in one dimension, it combines three moderate improvements that multiply together.
The framework, named after legendary Soviet wrestler Aleksandr Karelin, who dominated international competition through sustainable intensity rather than unsustainable bursts, operates on a simple formula:
1.20 × 1.20 × 4.0 = 5.76x
The first factor (1.20) comes from a strategic work volume increase, targeting sustainable 50-hour weeks rather than burnout-inducing 60-70 hour marathons. The second factor (1.20) derives from systematic efficiency improvements through process standardization and automation. The third and most powerful factor (4.0) results from extreme focus concentration, directing 80% of resources toward the 20% of activities that actually drive competitive advantage.
Each component is achievable. Combined, they deliver productivity gains of 400-600% on critical activities.
Three Transformations: Inside the Numbers
The framework’s real-world results have been documented across multiple manufacturing contexts.
Transformation 1: From Commodity Supplier to Market Leader
A retail equipment manufacturer generating $48 million annually with 4% operating margins appeared stuck in commodity competition. Twenty-six months later, revenue had grown to $60 million while operating margins reached 17%. The 400% increase in operating profit came not from working people harder, but from ruthlessly concentrating resources on high-margin product lines while exiting unprofitable SKUs.
Transformation 2: Doubling Margins Through Speed
An industrial scales manufacturer already profitable at 15% margins saw an opportunity to reposition from equipment supplier to operational partner. The key differentiator: decision velocity. By responding to quotes in 24-48 hours versus competitors’ week-plus turnaround, the company captured deals that previously went elsewhere. Over 36 months, operating margins doubled to 30% while revenue grew 60%.
Transformation 3: Growing by Shrinking
A custom manufacturing operation with healthy 27% margins faced stagnant growth despite a full order book. The counterintuitive solution: fire 30% of customers. By exiting unprofitable relationships and concentrating capacity on high-value work, revenue increased 67% while operating margins improved to 40%. On-time delivery jumped from 65% to 89% as the remaining customers received better service.
The Sustainability Imperative
The framework explicitly rejects the “churn and burn” approach that the Mercer research shows investors increasingly view as value-destructive. The 50-hour boundary isn’t a suggestion—it’s a hard constraint based on evidence that performance degrades rapidly beyond this threshold.
Organizations track sustainability indicators throughout implementation: voluntary turnover, engagement scores, work meaningfulness ratings, and health metrics. Warning signs trigger immediate intervention. The goal isn’t maximum short-term extraction. It’s sustainable competitive advantage that compounds over years.
Implementation: A Four-Phase Approach
Successful implementations follow a deliberate sequence:
Phase 1 (Months 1-2): Establish decision architecture. Create explicit decision rights, implement weekly war rooms, adopt the 70% rule.
Phase 2 (Months 3-6): Apply extreme focus. Conduct rigorous portfolio analysis, rationalize SKUs and customers, reallocate resources to critical activities.
Phase 3 (Months 7-18): Drive systematic efficiency. Standardize processes, automate routine tasks, develop decision support tools.
Phase 4 (Months 19+): Strategic volume increase. Only after sustainable patterns are established, carefully expand work capacity within sustainability boundaries.
The sequencing matters. Decision velocity first creates the organizational metabolism needed for everything that follows.
The Competitive Window
For manufacturing leaders watching competitors pull ahead while their own organizations remain stuck in analysis paralysis, the message is clear: the advantage goes to those who can decide and execute faster, not those with the best spreadsheets.
The manufacturers achieving breakthrough results share a common trait, they’ve abandoned the pursuit of perfect information in favor of rapid, correctable action. In an environment where 82% of workers are already at burnout risk, working harder isn’t an option. Working smarter through intelligent focus and accelerated decision-making is the only sustainable path forward.
About the Author
Todd Hagopian has sold over $3 billion in products across leadership roles at Berkshire Hathaway, Illinois Tool Works, Whirlpool Corporation, and JBT Marel, generating $2 billion in shareholder value through systematic business transformations. His research on corporate transformation has been published on SSRN, and his book The Unfair Advantage: Weaponizing the Hypomanic Toolbox is available now. Featured over 30 times on Forbes.com with additional coverage on Fox Business, Washington Post, and NPR, Hagopian writes extensively on Corporate Stagnation Transformation at toddhagopian.com.
