A Heavy Price Tag on Doing Nothing

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/