Efficiency is the path to bigger profits. Efficiency is good. Everyone needs to be efficient. Right? Wrong!
Efficiency sucks! For knowledge workers - you and me - the case against efficiency is overwhelming.
'Efficiency' is one of the weasel-words of management-speak, constantly misused and we are all worse off for this. In an effort to be or to become more efficient, people end up looking the wrong way, focusing on and doing the wrong things. Part of the shell game called 'management,' efficiency has everyone
focused on results, usually in the form of numbers, rather than the work they are doing. The consequences, sometimes, are disastrous. Those numbers, which are often hugely problematic and, in many cases, just wrong, don't tell us whether we are doing good work. Far from it. These are some of the things people do in the name of efficiency and to produce results - numbers - to make themselves look good - efficient - to management, shareholders, or some other group. They
- cut costs without considering the human, social, and environmental consequences;
- take action that is highly questionable, irresponsible, possibly unethical, and, at times, immoral; and
- deliberatively fudge or misrepresent 'the numbers,' which is remarkably easy to do.
'Find a way to measure this.' 'Just give me the data'. 'What is it going to cost?' 'What is the ROI?'. Management's reliance on numbers to get things done is closely tied to the mindset of efficiency. You can trace the whole efficiency movement to Fredrick Taylor and a small bunch of acolytes and imitators, the first generation of management consultants and the first 'efficiency experts'.
Efficiency, along with the emphasis on data, made sense in factories but, today, practically everyone is a knowledge worker and the mindset no longer makes sense. Contrary to what business books, MBA programs, and most 'experts' tell you, there is neither a right nor an accurate way of measuring knowledge-work. It is hard to find anything to measure but, when you do, it generally has little or nothing to do with work. Remember the adage 'what gets measured gets done'? Well, in the interests of efficiency, looking for something that can be measured, people end up focusing on matters that are peripheral to work. (Remember that budgets, deliverables, lines of code, the number of calls made, or the number of records processed isn't work. Work is what people say on telephone calls, the content and quality of the code, what they do when they are processing records, or how well they spend the money in the budget... and what happens as a result.)
In case you think I'm overstating the argument that efficiency is a problem, look back just a couple of years to events that are still having repercussions; the financial crisis that shook the foundations of the global financial system and the explosion of the oil rig 'Deepwater Horizon', which spewed millions of gallons of crude into the Gulf of Mexico. Before the crisis in which many, many people lost their life savings the financial firms responsible for it, including Lehman Brothers, Goldman Sachs, AIG, and many others argued as they continue to do today that trading unregulated derivatives and other securities enable them to be 'more efficient'. Banks could reduce risk while expanding lending. This, they said, made everyone better off. Oh yes, at the same time the financial institutions were able to rake in billions of dollars and pay their executives and brokers outrageously large sums. Why? Because they were so efficient.
While it takes a concatenation of events to bring down a financial system or to cause a pipe to rupture deep below the ocean’s surface, when it comes to assessing causes we make a necessary and practical distinction between accidents, which happen in spite of everyone’s best efforts, and carelessness or negligence. Then we try to get to the bottom of things and figure out how much one, or the other, played a part. As investigations continue it is increasingly clear that, in large measure, people’s carelessness and negligence are to blame for both these sets of problems. Lured by the mantra 'efficiency, efficiency, efficiency,' and 'better, faster, cheaper, more,' motivated by greed and ego, executives of companies that ought to be conservative and careful because they are dealing with other people's money and the earth's precious ecology, rewarded themselves and their employees for being unscrupulous, reckless, and imprudent.
Efficiency is a technical, not a human-oriented concept. It has to do with input-output ratios, such as miles per gallon and cost per square foot, rather than with human values like care, consideration, and responsibility; or even just 'good' and 'bad' work. Efficiency belongs with engineering and technology. Asking how to make work more efficient is the wrong question. The right questions are, 'what is good work' and 'are we doing it'. When you use efficiency in the wrong context, as a guide human action, there is a real risk that, possessed by a technical frame of mind, you lose sight of people - human beings: both those doing the work and those for whom the work is being done.
The mindset of efficiency permits and even encourages inhumane working conditions. Stories of cruel and miserable working conditions are an everyday phenomenon. They stretch all the way from the lives of agricultural workers in Florida to Chinese firms producing Apple's products. Apple makes technological magic I love to use, but its executives are responsible for contracting out production of the clever technology to firms whose management policies, including the amounts they pay workers, test the limits of human endurance and dignity. Why? Because, when it comes to management practices, in these firms, like most organizations, efficiency is uppermost. Their strategies are driven by a desire for ever-greater efficiency.
So, too, is the Veterans Affairs Administration (VA), which is why I was saddened, but not surprised, when I read the following in the Seattle Times about testimony to the Senate Committee on Veterans Affairs.*
VA practices "greatly distorted" the waiting time for appointments, ... enabling the department to claim that 95 percent of first-time patients received an evaluation within 14 days when, in reality, fewer than half were seen in that time. …. Nicholas Tolentino, a former mental-health administrative officer at the VA Medical Center in Manchester, N.H., told the committee that managers pressed the staff to see as many veterans as possible while providing the most minimal services possible.
"The plan that was ultimately developed gamed the system so that the facility met performance requirements but utterly failed our veterans," said Tolentino, a former Navy corpsman who went to work at the facility in 2009.
One manager directed the staff to focus only on the immediate reason for an appointment and not to ask the veteran about any other problems because "we don't want to know or we'll have to treat it," according to Tolentino.
"We fully embrace that our performance measures need to be revised," William Schoenhard, deputy undersecretary for health for operations and management, told the committee.…..
Put these problems down to the desire for greater efficiency, rather than better care.
Efficiency and care are not the same. At best there is a weak correlation between numbers and care. One is a technical consideration (How many patients do medical and administrative personnel see or talk to each day? How long do patients have to wait for an appointment? How long does a doctor spend with a patient?) the other is a matter of human feelings, attitudes, emotions, relationships, including the capacity and desire to do good work.
Short of keeping a very close eye on what is going on between administrators and patients and doctors and patients, and asking patients about their experiences, there is no simple, and certainly no unambiguous way of assessing the quality of care that veterans receive. Under the misguided assumption that a few numbers will convey to people 'higher up,' who are not involved in the work, whether the those doing the work of providing care are doing it efficiently, someone sets performance targets. This puts the 'machine' bureaucracy into motion and initiates a bureaucratic response. (Remember that bureaucracies, where employees follow rules and cannot use their initiative, are archetypes of efficiency.) Employees tasked with providing the numbers (mostly clerks and administrators) are going to be judged not by the quality of the care they provide and not by their patients, but, based on data they receive, by their superiors who are also administrators. Neither health nor care really feature in this process.
Don't get me wrong. I'm not arguing against the importance of doing good work or of encouraging people to do good work. Good work - here, the kind of care that helps veterans and their families as much as possible and is aimed at healing - is exactly what we do want from everyone involved. But, as long as a mindset of efficiency prevails, starting at the top, everyone, all the way down the chain of command, will be looking in the wrong direction; at the numbers, not the work. Revising performance measures probably won't make any difference. As long as these take the form of numbers, data providers have every incentive to make them look as good as possible and people will busy themselves with whatever makes the numbers look good, not with taking care of patients.
Efficiency has more to do with exercising control than doing good work. 'Efficiency' is a way of ensuring compliance. Compliance is a means to an end. Because knowledge-work is complex, creative, and challenging (as well as cooperative), to do it well, those doing it need to be focused on the ends: the work and whether it is good work. They need to pay close attention to what they're doing and have the authority to decide what to do. Efficiency plays a major role in preventing people from doing either. Efficiency puts all authority at the top (with 'the experts'). 'The top' determines what is or is not efficient and, when efficiency is the goal, instead of looking 'out' to their clients and customers and asking, 'are we doing a good job,' everyone looks 'up,' waiting for approval from the top. Here is one major reason why management practices are dysfunctional.
I explain in my book Beyond Management that If we are going to get rid of the dysfunctional practices and change the way we do our work - something we badly need to do - we have to change the way we talk and think about work. If I had my way I'd banish the word 'efficiency'. I'd start by making it a punishable offense to talk about 'efficiency'! From top to bottom, highest to the lowest, no would be exempt. For the first three offenses they'd pay a fine, with the money going to charity. After this it would be a month without coffee and every lunch hour spent in detention, under supervision, researching and writing an essay on the "E" word: 'why I must not say "efficiency" at work'.
I'm serious about this. It is not a trivial matter. Talking about efficiency is bad for work - for all of us.
Originally published by Mark Addleson at Management is Dead: Taking Charge at Work
*Thanks to Mark Leheney for sending me the link.