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When efficiency goes too far

Many strong companies and strong leaders share a common quality: efficiency. Efficiency means making the best use of resources, reducing overall costs and improving organizational productivity. When someone does more with less, we’re quick to celebrate, and with good reason!

And 2020 has only brought efficiency further to the forefront. The COVID-19 landscape, and subsequent economic repercussions, has presented numerous changes in how we interact, work, connect and digest information. It has also resulted in a majority of businesses adjusting their internal workflow structures and examining ways in which they can improve efficiency.

Yet, it’s possible that pushing for more and more efficiency can negatively impact business and the economy. Like many good things in life — take a delicious dessert, for example — more is not always better. Could there be a downside to always putting efficiency first? And if you’ve taken efficiency too far as a leader, what can you do to reverse course? Explore some strategies to ensure striving for efficiency doesn’t go too far — and how you can avoid unanticipated consequences.

Remember the “human” in “human capital.”

Especially as so many organizations continue to operate with a remote workforce to help slow the spread of the pandemic, building genuine connections calls for plenty of intentionality and creativity. Without one-to-one opportunities to touch base, like going on a team coffee run, bumping into a colleague in the hallway or simply walking across the hallway to ask a question, knowing how people really are doing can be a challenge.

Efficiency requires endurance, so don’t forget to check in with your employees on a regular basis. How is your manager handling an increased workload and additional projects in light of company changes? How is your new hire doing in her onboarding, since she’s only been able to meet her colleagues via videoconference? How is staff morale after last month’s furlough? Investing in people’s emotional wellbeing can set the stage for long-term loyalty and job satisfaction, so don’t let efficiency get in the way of taking care of your team.

Broaden your objectives.

Often, businesses have one overarching objective, such as sales growth or increasing shareholder value. While it’s nice to have one goal that everyone chases together, negative side effects can arise if your goal becomes too narrow. By operating with the mindset that a sole measurement can define success, your organization is likely to focus on finding efficiencies to meet that one measurement, and your goal becomes diluted to the point where employees no longer see the goal in its entirety, just the measurement.

To put this into perspective, let’s say your company is striving to deepen customer relationships. To pursue this goal, leadership determines that success will be measured by the number of company services a customer is using. Over time, employees may begin equating service usage with the definition of a deep customer relationship. While it may correlate, there’s more to the solution, including the overall experience of using your services and the experience they have with your employees. Efficiencies cannot come at the cost of other important aspects of your goal, like delivering an experience that customers come back to you for.

To avoid unwanted hurdles, it can be helpful to establish a wider variety of goals to ensure your company doesn’t become blinded. Consider the impact of moving away from laser-focused efficiency and adopting a system dynamic approach instead. Recognize that multiple strategies can accomplish a core goal and embrace a diversified approach.

Build long-term resilience.

In order for companies to set themselves up for success, consider what a healthy balance looks like practically — with an eye on long-term strategies to cope with unexpected obstacles. The COVID-19 landscape has put this concept into perspective for many businesses.

For example, some healthcare organizations minimized staffing and purchasing of supplies and resources (like personal protective equipment) as an efficiency tactic and cost-savings initiative. Large and small grocers that had relied on “just-in-time” delivery found their customers’ demands changing, and saw shelves emptied of household staples (from toilet paper to flour) in the spring of 2020. And even industries that thrived during early months of the pandemic felt the pressure of decentralized technology and workforce resources.

Long-term resilience happens when leaders stop compartmentalizing and treating each department as its own separate entity — and start considering how their systems can operate at an optimal level as a whole and where extra margin can prevent shortfalls later on. You can be more adaptive in times of uncertainty when expertise is de-siloed.

In today’s ever-evolving workplace, business leaders can set the stage to thrive when they consider efficiency as a tool — and not the exclusive goal. An overuse of the strength of efficiency may not always be in the best interest of your business or your customers. Being aware of the cost of efficiency can make a big difference.



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