Efficiency is a key leadership challenge.
How to achieve what you need to do at the lowest cost.
Your challenge as a leader who has to manage costs is the struggle between what you say you want (lower costs), and all the other things you really want.
Not just obvious things such as good quality, customer service, employee engagement, sustainability etc.
The difference between what you say you want, and what you really want is often that one is visible and the others hidden.
Visible inefficiency is easy, and features a lot in consulting reports and business plans.
You have 10 people doing a task, if you can do the same task with 8, you can save the cost of 2..
You buy widgets at $5. If you can get them at $4, you save $1 per widget…
If you move your office to a cheaper location you can save on rent…
Hidden inefficiency is what’s embedded in mindsets and history and expectations, including the leader’s mind.
Your mind also.
The team of 10 doing that task feel frustrated and overworked and believe they need 12 people.
The $5 widget maker has been a reliable supplier since the business started so nobody looks for a $4 widget.
Cheaper offices aren’t as comfortable or high status, so the more expensive office is accounted for as a revenue gainer, not a cost.
The task, the widget and the office all look different to those closer to them than they do from outside because they see, or feel what’s hidden.
That hidden inefficiency is often the cause of the gap between the plan and reality.
They’re also often unspoken. The elephants in the room.
As a leader you can’t just calculate the visible gap and assume your work is done.
That’s not leadership, that’s mathematics.
The leader’s job is to find the hidden inefficiencies and work on changing them.
The leader’s job is to ask the right questions.
“Your challenge as a leader is the struggle between what you say you want, and all the other things you really want…”
The size of the team isn’t driven just by the tasks you know about. What are the frustrations they feel? Are they justified? Are they doing unnecessary extra tasks? Or is the team just looking for an easy life?
Maybe they aren’t or maybe they are, but it’s a leader’s job to ask.
The widget price isn’t a market price issue it’s a relationship issue. Is the supplier so important to your future that they can’t be challenged?
Maybe they aren’t or maybe they are, but it’s a leader’s job to ask.
The office issue isn’t a real estate question it’s a priority question. Is location important for employee engagement, or customer, or brand perception? Or is it just an ego thing?
Maybe they aren’t or maybe they are, but it’s a leader’s job to ask.
Do you know where your team is inefficient?
Do you know why?
Does your team do things you don’t know about?
Are there relationships that stop you from being efficient?
How much do you spend on comfort and status?
Do you step back regularly and look for those hidden costs? Ask those questions?
Are you efficient?
.
.
“I might be wrong, but at least I’ve thought about it…”