Bill Canady presents a 2-by-2 framework that maps customers by profit contribution and products by strategic fit into four quadrants. Focus on A customers (top 25% of profit) and core products where you have cost advantage, then stop managing the low-value segments that drain resources.
Here's how it works mechanically. 2 axes, right? On the first axis is your customer ranked by value, not by revenue, by profit contribution. Split them. The A customers, roughly the top quartile or 2, and the ones producing the 105 to 150%. And the B customers, that's everyone else. I know a lot of you want to do Cs and Ds and all that, but let's not go down that slippery slope. You're either the top. or your everything else. Own it. You'll be happier you do. Makes your life simpler. On the other axis, your products sorted by strategic fit. Core products, what you're actually built to make, where you have a cost advantage, where the volume runs. And the tail products, the accumulated inventory of everything you've ever agreed to make for somebody once. Cross them and every dollar revenue in your company falls into exactly one of 4 boxes.
