Published on 23 Nov 2019 in agile
What’s wrong with organisations aiming for efficiency above all else?
The answer to this question is illustrated with a line usually attributed to Yogi Berra but probably older. Legend has it that in 1972 the famous American baseball player was driving to the Hall of Fame with his wife, Carmen, and kids when she began giving him a hard time for being lost. He responded with a classic Yogi-ism - “Yeah, but we’re makin’ good time ain’t we?”.
It’s funny because clearly if you’re heading in the wrong direction, saying you’re making good time misguided. Focussing on efficiency over effectiveness creates the same problem.
In product development terms, inefficiently working on the right thing is better than efficiently doing the wrong thing.
If it’s obvious, why do so many organisations obsess over efficiency? A key reason is that they’re still applying scientific management principles from an era of mass production to a new context. It doesn’t work. Taylorism and its focus on efficiency and job simplification is perfect for mass production where the work is simple and the direction you’re heading in is clear. When the work is more complex and innovation becomes more important a new paradigm is needed.
So how do we tip the balance to focus on effectiveness?
Tom DeMarco’s excellent handbook ‘Slack’ covers this topic. Rather than trimming capacity in the effort to become more efficient, modern organisations should be building more in. Transformation and change require significant capacity. Growth requires capacity to invest. Innovation requires capacity in the form of investment of time and resources.
Streamlining for efficiency usually means there’s no slack for when something goes wrong. When it does, quality usually suffers to make up for strict deadlines. There is an inverse relationship between quality and quantity - doing less will increase the quality of your product. In 1997 Steve Jobs took Apple from 350 products to 10. The increased slack allowed for focus and innovation. Apple made a triumphant return and ultimately went on to dominate in their market.
To retain great people you need to ensure they have the time to do a good job and grow in their careers. The hurry up organisation - a term used for organisations that are doubling down on efficiency - burns people out. To innovate you must experiment. An absence of slack means those that aren’t burned out don’t improve their skills and test out new ideas. The business books are awash with examples of employee innovations becoming massive successes. Post-it notes were possible because a 3M employee had the time to experiment and innovate. GMail was a side project. Creating space for innovation is important but it’s not just about squeezing it in whilst the same people are working on existing product lines.
Leading organisations accept that innovation, transformation and change requires full time dedication.
In an environment where innovation is required to get ahead and even stay afloat organisations need to be comfortable with risk. Like a surfer looking for the biggest waves, we need to be looking for the risky bets. Most big discoveries sit on top of a mountain of failed prototypes. An organisation without much risk in its endeavours should at least be investing heavily in other, more promising and risky areas.
Having a healthy appreciation of risk does not mean being reckless, it needs to go hand in hand with diversification at a strategic level, good management and strong learning loops at a development level.
The benefit of building in more capacity, flexibility, slack, whatever you want to call it, is responsiveness to change in the short term. In the long term it’s innovation, learning and worker retention.
Spare capacity and flexibility within your organisation allows you to become effective…When you’re effective, then you should look at efficiencies.