Business Definition for: Doughnut Principle

• a concept that likens an organization to an inverted doughnut with a center of doughâ€"the core activitiesâ€"surrounded by a holeâ€"a flexible area containing the organization's partners. The doughnut principle was originated by Charles Handy in The Age of Paradox (1994). He saw organizations as having an essential core of jobs and people, surrounded by a space filled with flexible workers and flexible supply contracts. He maintained that organizations often neglect the core, developing the surrounding hole instead. The doughnut analogy is a way of helping a balance to be achieved between what has to be done and what could be done, by analyzing the dough and the hole of a particular organization. The principle has also been applied to personal life.