Dr. Rhys Thomas is one of the most intelligent business owners I’ve ever served, and coincidentally, he’s probably slightly ahead of his co-partner of many years (sorry, Ken Allman, but you are still in the top 3).

Dr. Thomas was the first person I heard using the term “deadwood” when talking about business. He’d mention that deadwood is inadvertently added as a business succeeds. But it needs to be found and discarded as business drops. He’s so correct on both counts. Incidentally, in the context of “deadwood,” Dr. Thomas was referring to people.

For those of us who work in capital-intensive businesses, deadwood is rarely an issue during times of financial famine. Even in times of bounty, dead assets not only collect dust but also tie up capital and should be pared back so that cash can be put to better use.

While slightly counterintuitive for younger financial executives, revenue-generating assets should never be kept idle for just-in-case situations. I’ll explain why in this brief overview and share some of my favorite examples of eliminating dead assets.