If one can improve something, should they? An idealist may reply, “Absolutely. Improvement is intrinsically good, therefore, one should improve everything one can.” If the cost of improvement is zero then who would disagree? Though not always obvious, the cost of improvement is not zero. Consider the recent supply chain crisis and related increase in prices for goods. Many declared, “We need to improve the reliability of our supply chain!” Why not, right? Can industry make supply chains more reliable? Yes. Will costs increase as a result? According to the Wall Street Journal, also yes.
“After the pandemic and the Ukraine war disrupted supply chains, many business leaders adopted new processes to increase reliability even if they cost more, such as by moving production closer to home or buying from multiple suppliers. And tensions between Western democracies and Russia and China raise concerns about a possible further retreat from globalization and rise of protectionism, which would raise production costs.”
The point is not to agree or disagree with the decision to improve supply chain reliability, but to point out the less obvious cost of doing so. The need for cost/benefit analysis prior to improvement is hardly a novel concept, nonetheless organizations make resourcing decisions contrary to this wisdom. One reason this happens is exhortations. Sound made up? Edwards Deming felt so strongly about the hazard of exhortations in the workplace that he included it as one of his 14 Points for Management: “#10 – Eliminate exhortations.”
Consider the following pithy exhortations:
- “In the spirit of continuous improvement, we will work on this problem!”
- “We believe in the power if incremental improvement, let’s make this happen!”
- “We believe in innovation, and this is an innovative project! Let’s do it.”
- “We strive for excellence, and this is not excellence, let’s fix it.”
These nice-sounding exhortations contain flawed logic that can be easily overlooked. They lay the foundation for a logical fallacy called “affirming the consequent”. This means using an argument which uses a true conditional statement (i.e. “If you believe in the spirit of continue improvement, then you work on problems”) and invalidly infers it’s converse (“If you work on problems, then you believe in continuous improvement”). What if someone challenges the decision to solve a problem? Might they be a non-believer of continuous improvement? If flawed logic becomes organizational doctrine, wasteful resourcing decisions (and much worse) can abound.
Exhorting logical fallacies isn’t the only thing that contributes to wasteful resourcing, so too are plain misunderstandings. In the 1970s, Philip Crosby proclaimed that “Quality is Free”. One interpretation of this is “Quality doesn’t cost anything!”
“I call it… Hypothetical future value accounting” -Jeff Skilling, COO, Enron
What Crosby meant was that the cost of solving a problem can be offset by the waste reduction realized by solving it. And Crosby is right, it can, but it doesn’t always. Sometimes solving a problem is worth the resources, sometimes it isn’t. Due diligence is necessary.
How can one help their organization be better stewards of improvement resources? Humbly ask questions and challenge assumptions. Here are some questions to help improvers discern their way into responsible improvement work.
- What is our organizational and or local mission & vision and how would solving this problem add or detract from those things?
Consider where the organization aspires to be in the next 5-10 years. Consider what is mission-critical. Ask probing questions to cut through the ambiguity of common adjectives like “world class” and “innovative”. For example, ask, “world class according to whom? Is the aspiration to be top ranked? In which benchmark? What will it take to get there?”
- How impactful would solving this problem be on our mission and vision and how impactful is it relative to other problems we could solve?
Consider the problem relative to other problems. How many lives will it impact? What does “impact” mean? Will this impact experience, health outcomes, or something else? By how much? Why do we care? Remember, the goal is to make an informed decision, not to find the correct answers to these questions.
In conclusion, IGNORE the song of the sirens that sing improvement exhortations!
Ask questions. Be humble. Leave the organization better than you found it.
Always be discerning.