On Cost-Cutting, and Confusing Inputs and Outputs

Scott Francis
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Donna Fitzgerald of Gartner has a very thoughtful post regarding whether our businesses might have cut too far in this latest economic downturn in a post entitled “Cutting to the Bone and then Some”  I think she makes a few valid points for sure.
Now on to my point; I’m not seeing the increase in creativity or innovation I would be expecting as part of our changing economy and I’m not sure why.  I’ve got a gut instinct that says we’ve cut too far and adopted too much of an attitude that if we have enough process than any trained monkey can do the work.  The problem is that trained monkeys don’t innovate. Part of my concern comes from a recent personal trip I took.  Almost everyone I spoke with in my travels was angry, over worked and stressed almost to the point of breaking.  Stress kills creativity.  It also kills productivity over the long haul (though not unfortunately in the short run).
I’ve observed the same in many of my dealings with businesses.  There is a lot of stress and overwork.  And I agree with her instinct that too many people think that people are like nails- that you can trivially replace them with cheaper nails.  As someone who grew up in Florida, where hurricanes are known to make landfall, I can tell you that there are nails, and there are nails (not to mention, how you apply them matters).  And there are architects and builders that are worth the money you pay them – and you know this when your neighbor’s house survives the hurricane and the rest of the neighborhood doesn’t. Why is it so easy for people sitting in management chairs to believe that people are fungible commodities?  It is this belief that leads to endless pursuit of the lowest cost-per-hour labor, where ever it is (Too often, people mistake cost-per-hour as being the same as cost-per-unit-of-output… but the hour is not the output, it is the input). People are the beginning, the middle, and the end of your business.