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Tuesday, October 27, 2009

PRODUCTIVITY

If you lookup the word "Productivity" in a dictionary, you'll probably find something like, "The rate at which goods or services are produced, especially output per unit of labor." This implies the best way to improve productivity is through speed. There is no consideration for mistakes made or challenging the process by which something is produced, just speed. This is one of the most fallacious concepts common to American manufacturing and I see it just about everywhere, not only in the corporate sector.

For many years, our company has touted the following formula:

Productivity = Effectiveness X Efficiency

To produce anything, be it a product or service, there are two aspects to consider, not just one: "Doing the right things" (effectiveness), and, "Doing things right (efficiency). Whereas efficiency is concerned with process speed, effectiveness considers the necessity of the task itself. For example, in an assembly line, robotics offer faster speed in performing tasks such as welding, but if the weld is being performed at the wrong time or in the wrong place, then it is counterproductive regardless how fast it works. In other words, in addition to speed, we should be challenging the whole process ("Doing the right things").

Effectiveness addresses more than just business processes though, it is also concerned with the work product to be produced. After all, there is little point in building something efficiently that should never have been built at all. To illustrate, there is no doubt in my mind the automobile industry in Detroit knows how to make cars efficiently, but it has become painfully obvious they were building the wrong cars. What's the point of putting something on a menu that nobody is going to order? While Detroit focused on efficiency, foreign competition concentrated on building the right products and captured the American market.

We also see this difference of effectiveness and efficiency in our daily lives. For example, you may believe you had a great day at work; that you accomplished a lot, and maybe you did. Then again, maybe you didn't do as much as you might think. A lot of people believe just because they were a model of efficiency, they were being highly productive, but were they working on the right things? To quantify your personal productivity, I devised a simple calculator to compute your personal productivity which can be found at:

Bryce Daily Productivity Analyzer

Why are Americans consumed by efficiency and not effectiveness? Probably because we do a lousy job of planning and, as a result, routinely find ourselves in a crisis mode impatient for results. Not surprising, the emphasis in this country is on speed, speed, and more speed! Or as American programmers like to say, let's not waste time on planning, let's simply be more "Agile." I don't care how you try to spin it, "Quick and Dirty" is "Quick and Dirty." Quite often you hear workers lament, "We don't have time to do it right," which, when translated means, "We have plenty of time to do it wrong." Our foreign competitors are the antithesis of this mindset and spend more time planning and, in the process, are capturing the American market.

Such is my Pet Peeve of the Week.

Keep the Faith!

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Tim Bryce is the Managing Director of M. Bryce & Associates (MBA) of Palm Harbor, Florida and has over 30 years of experience in the management consulting field. He can be reached at timb001@phmainstreet.com

For Tim's columns, see:
http://www.phmainstreet.com/timbryce.htm

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Copyright © 2009 by Tim Bryce. All rights reserved.