The business world is a bewildering, fast-moving place
right now. But don’t fall into the trap of bunkering down and doing nothing,
because this will cost you in the long run, says Kevin Phillips
The largest enemy of change
and leadership isn’t a “no”, it’s a “not yet”. “Not yet” is the safest, easiest
way to forestall change.’ – Seth Godin
On a recent trip I took to New Zealand, the Auckland
airport was closed down and its operations curtailed when the pipeline
delivering jet fuel was dug up by accident. It seems impossible that there was
such a massive single point of failure for the airport, which is a pretty
significant regional hub. One stakeholder said in a radio interview that the
cost of laying an additional pipeline wasn’t able to be justified as it would
only be used infrequently, if ever.
Surely that is the very definition of back-up?
So instead, hundreds of planes were grounded and
delayed, fuel needed to be trucked in, inefficiently and at great expense, and
only ten days later was the pipeline repaired and put back into action. This
management philosophy, based on the assumption that nothing can go wrong, may
have been acceptable a few decades ago, but is way, way out of place in today’s
world of rapidly changing requirements and expectations.
Three horsemen of the
inertia apocalypse
Warren Buffett once said at his annual investors’
meeting: ‘Inactivity strikes us as intelligent behaviour.’ And it’s hard to
argue with this if it’s conscious, mindful inactivity and a result of a careful
evaluation of the situation and a decision that the status quo is the least
risky course and the best use of available resources. However, mindless,
knee-jerk inactivity, resistance to innovation and improvement, and even a lack
of maintenance and monitoring are a different kettle of fish altogether.
‘I’ll think about it.’ In my experience, this response
to innovation, a new process or product seldom delivers a decision in a
positive way that can drive a business forward. Whether it’s to avoid change, a
fear of failure when undertaking something new, the perceived (or real) risk of
upsetting the boss, laziness, or the dreaded ‘If it ain’t broke, don’t fix it’
thinking, the usual outcome is no decision at all!
Most start-ups or other companies setting out to
change and improve the way things have always been done for their clients will
empathise. Your competition in closing a sale is often not another company
offering a similar product or service, instead, it’s the ‘not yet’ or ‘we’re
thinking about it’ response.
Or, what I like to think of as the three horsemen of
the inertia apocalypse: resistance to getting moving, moving faster, or
changing direction. And this unholy trinity coagulates to form a dangerous
situation where cost of doing nothing jobs are neglected for another day.
Cost of doing nothing jobs
Cost of doing nothing jobs? A strange choice of words
perhaps, but I like to think of these as the jobs that cost money but are not
directly revenue generating, at least initially. These are the maintenance,
optimisation and improvement tasks that will divert time and resources away
from elsewhere, but because they are preventive or future-proofing your
organisation, it is hard to quantify the cost of not doing them as this is
largely opportunistic. Until the situation becomes critical, that is, and they
end up costing you big time.
These are also the projects that can shift the
paradigm for your organisation, building a foundation for future innovation,
growth and success. Hence the danger of not doing them. An example is moving
your operations onto the cloud. Neglect to spend the time and money today, and
you may find yourself behind tomorrow when your competitors are offering
cloud-enabled services and innovations that you simply can’t.
Take my hometown, Cape Town. Like other cities and
regions around the world, we are currently at the start of what looks to be a
long-term drought situation. All of a sudden, the leaking taps that could have
been fixed months and years ago are critical – but people were busy, or would have
had to adjust their household budget, or just didn’t know where to find a good
plumber. Months and years ago the cost of doing nothing would have been hard to
estimate. Today, as water levels drop and water costs rise in the city, the
cost of doing nothing is all too apparent.
Step it up a level, and you’ll see the cost of doing
nothing has also resulted in the status quo being preserved. While summers get
hotter and the winter rainfall season gets shorter, ‘management’ (in other
words city officialdom) has continued to rely on large dams in specific
catchment areas for our water.
Now, with shifting weather patterns and a growing
population, they’ve realised, all too late, that there is a need to change the
approach to water management. What worked last year, won’t work next year. The
crisis management that is upon us now will come at a price which with more
innovative forward planning or attending to some of those cost of doing nothing
jobs in a more timely fashion could have been managed more effectively and at a
fraction of the future cost. The old adage ‘a stitch in time saves nine’
springs to mind.
Innovate to survive
In the business world, cost of doing nothing jobs are
often also the small steps needed to innovate. Innovation is too often painted
as a wide-ranging, paradigm-shifting, big bang event. But it includes the
incremental improvements to products, services and processes and asks the
question, what is next?
It’s not surprising that an unhealthy attachment to
the status quo, and resistance to change, is part of the fabric of most
organisations. Companies are often still built to Industrial Revolution
specifications. When assembly lines were the heart of an operation, things
needed to be repeatable, predictable and risk-free. Similarly, the Waterfall
Method worked for hardware design but should never have been transplanted lock,
stock and barrel into a software world. Now that the Industrial Revolution era
is heading to a close, this type of thinking is becoming increasingly
egregious.
The culture of risk-aversion and a steady as she goes
approach is exacerbated by tough economic times, cost cutting and management
protecting their pensions instead of rocking the boat and challenging the
status quo. And this means that cost of doing nothing jobs fall by the wayside
until it’s too late as they are the easy targets when looking for costs to cut.
Start-ups don’t have this inability to change, nor an
attachment to the way things have always been done. This gives them a window of
opportunity to innovate and delight your customers that you simply don’t have.
And while the inertia of its members might be baked
into the business model of every gym contract, organisational inertia has
reached its sell-by date and may leave you grounded, like it did the planes
passing through Auckland.
As published in Accountancy SA Magazine - November 2017 https://www.accountancysa.org.za/regulars-a-heavy-price-tag-on-doing-nothing/
