Tuesday, October 2, 2012

Do More With Less

If I hear another executive spout that we need to “do more with less”, I might just scream.  Apparently they don’t read their audience’s reactions, which range from rolling eyes to demoralization to demonization.  It says to them that management can’t figure it out, so we’ll be cutting spending and working longer hours.  Or perhaps like in the movie Ben Hur, we’ll force the slaves to make bricks without straw.  I’ve never seen it inspire the troops or become the rallying call to action.  

But what are they trying to say?  We have to become more productive.  That simple.  Not any more enlightening perhaps, but at least it’s a better starting point for a conversion. And it’s a lot less threatening, so perhaps some folks will start to engage to figure out how to measure productivity and improve upon it.  I’ve been around long enough to see a few ways that might help you in figuring your  plan out.

Back in the early 1980’s, our company had a small round of layoffs, and our department had to reduce its staff by seven people, roughly a 5% decline.  That’s certainly fits the “with less” side, but it would result in doing “a little less”.  So we used this opportunity, with the company’s approval, to reduce staff by fifteen and then hired eight new people.  So the bottom 10% were let go and a more talented 5% added.  At the end of the process we were more productive.

Information Technology have a built-in advantage in that hardware and telecommunication costs decrease year-over-year at roughly the pace described by Moore’s law, which was an observation made by Gordon Moore, Intel’s co-founder.  He thought the number of transistors on an circuit would double every two years for the next ten years.  It turns out that prediction has lasted for the last forty years without any obvious end in sight.  This results in an exponential curve of productivity and the built-in IT advantage, at least if you’re prepared to take advantage.  I ran a network group for several years at a company roughly the size of my current company.  Over the twenty year span of then to now, the network budget decreased about 80% and where a T-1 line (1.5 Mbp/s) was considered top-of-the-line, we routinely deploy lines 10 to 30 times faster.  Phone calls used to be $0.25 per minute; now they are under $0.02 per minute.  Showing improved productivity as the network group manager was a pretty easy task and it funded other parts of the IT group to tackle new projects.  

My advice for improving productivity is starting with throwing out costly, time-consuming, lower-value work and taking some of that savings to fund higher-value projects, particularly those projects that need early funding to create lower costs in the future.  You’ll have to have a very good understanding of your costs, be willing to change anything, break off from traditional vendors relationships and invest in choices that prepare you for lower costs later.  But that can be a lot of fun.  A lot more than making bricks with no straw.

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