A few years back I – accidentally – launched a new web site. I didn’t mean to, really. It just happened because what I’d planned to do in January was just more cost effective to do in December. So before I knew it I had an imperfect web site that went up without much/any planning, and customers started using it. In this happy accident something I’d suspected for a while about the value of planning became crystal clear to me. Despite what all the business literature tells us, sometimes plans can be the recipe for inefficiency, and this isn’t all bad – especially when you’re out to change the world.
Efficiency is Great
That unplanned web site happened the same year I was teaching change management and team-building to a Lean Six Sigma class at GWU’s Center for Excellence in Public Leadership. Lean 6 is all about squeezing the .04% inefficiency out of a process that can return millions in savings and productivity. And in large scale predictable processes, the returns for such increased efficiency can be huge. All necessary. All good. Especially if you’re building an airplane or running a high-volume manufacturing facility.
Putting my strategic planner hat on, it seemed obvious that the entire art of business planning is an intentionally small investment in inefficiency (i.e., an overhead activity) built into the front-end process designed to reduce or eliminate efficiency on the back end. “A tea cup of planning and an ocean of execution,” Ross Perot used to say.
This strategy makes sense if the back-end includes mass producing airplanes.
But what if that’s not your game? What if you’re trying to hold a formerly-terrorist-held neighborhood in a country you don’t know well? Creating/responding to an emergent market/need that’s taken your company by surprise? Struggling to launch an important nonprofit program on behalf of people who can’t speak for themselves? Or playing basketball against an aggressive and resourceful team with some new moves? What if you’re trying to lead change and transformation in places typical managers and leaders don’t venture into?
Inefficiency is Inescapable
In all scenarios, but especially in the fast-moving potentially world-changing ones where uncertainty and risk are highest, you simply can’t plan enough. No matter what you strategize in the locker room, things just happen in new and unpredictable ways out on the court. You have to learn by doing. And learning is inherently inefficient. This is what I discovered when I decided to go ahead and launch my web site two months early. Yes, I didn’t have as smooth a launch as I would have liked, but by the time I would have launched, I had more customers and I knew more about the technology I’d invested in to serve them.
Eric Ries in his new book The Lean Startup advocates spreading the cost of learning inefficiencies across the entire product development, testing, tweaking and operating cycles. He holds that the downside of pissing off early customers is lower than the upside of getting it right faster so they love you in the end. While this approach might not work for building an airplane, it has a lot of merit for many other aspects of business.
Part of me – the strategic planning part – struggles to understand why this idea of planning on inefficiency — instead of trying to get it right the first time — might be valuable. After all, my “big brand business school” mind cowers at the potential for customer satisfaction debacles, brandshine erosion and sales channel confusion. But then my own website accident occurred and I suddenly got it. When you’re in the locker room planning what “might” happen when the quarter starts, you can try to eliminate a major amount of inefficiency by planning the most likely scenarios.
But when you’re on the court and in the game – you can’t possibly have planned for every eventuality, you’re learning on the job, you’re vulnerable to uncertainty no matter what you plan. In the heat of the play, you instinctively take the opportunity for faster response times where you find them, you go for the 20% that produces the 80% without energy-wasting debate and you learn what the other team really demands of you. Sometimes you make mistakes and if the drive to win is strong, you can usually recover fast and do it better the next time. Assuming you planned your resources well enough, even when you lose, you live to play another game, with improved skills and a better understanding of what it takes to win.
In other words, inefficiency happens when plans hit reality, so you might as well accept it when everyone’s tolerance for it is maximized because the risk is high, the upside is within arms reach and everyone’s got their eye on the prize.
Inefficiency As Fuel for Innovation
We talk a lot about innovation in business literature and it strikes me that there is an important link here between the inefficiency of learning and innovation. Innovation often looks highly inefficient – until you can apply hindsight and see the benefits it did or didn’t produce. Only then can you do a cost/benefit analysis to see if there really was a more efficient way of producing… whatever.
Yet if we look at innovation through the on-the-court/maximized-tolerance-for-inefficiency thinking above, we can see that if we throw ourselves into the game, where the risk is high, we not only create the conditions to make the most of inefficiency, but we also increase the potential for innovation. Innovation isn’t just a product of the (ever shrinking) R&D department who has time, money and resources to dream, it’s also quite often produced by necessity, no or low resources and a distinct lack of time.
So what if we just accept that inefficiency happens and plan to build it in where it’s most likely and most naturally going to produce results? I tried this experiment real time with my web site, and it paid off.
What’s your response when inefficiency happens? Do you welcome it or allow it to frustrate you? What’s your best story of inefficiency-gone-bad? Gone-good? How have you experienced inefficiency and innovation working together? Do you plan on inefficiency? How does that work out for you?
Check out the resources in the InPower Coaching EQ at Work and Soft Skills Research Index.
