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Archives for October 2008

Employees are not Overhead

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Standard terminology, at least in the non-profit sector, refers to employees as overhead.

This needs to change.

People are not overhead. People are the force that makes any company effective. That is not overhead.

Matthew Kelly and Peter Drucker make this point better than I ever could:

It has been almost forty years since Peter Drucker observed the single greatest error of our accounting system: people are placed in the liability column on the balance sheet. Machinery and computers are categorized as assets and people as liabilities. The reality, of course, is that the right people are an organization’s greatest asset. (Matthew Kelly, The Dream Manager, page 2.)

Of course, just about everyone is willing to say “people are our greatest asset.” But largely this is still in the realm of theory–it hasn’t penetrated the way we actually work and think. Kelly goes on:

We may have acknowledged this truth in theory, but we have not allowed it to sufficiently penetrate the way we manage our organizations, and indeed, the way we manage the people who drive them.

One indication of the fact that we haven’t yet started taking seriously the reality that people are assets, not liabilities, is that we still use terms like “overhead” to describe them.

Employee Disengagement Costs You Money

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The other day I picked up a book called The Dream Manager. It’s another business parable, but it is very perceptive. (I had never been into business parables until I started reading Patrick Lencioni’s stuff, which is excellent.)

The book is about employee engagement:

The problem is, the great majority of people in the workplace today are actively disengaged. This is the dilemma that modern managers face. To varying extents, people don’t feel connected to their work, the organizations they work in, or the people they work with. No single factor is affecting morale, efficiency, productivity, sustainable growth, customer intimacy, and profitability than this disengagement. (The Dream Manager, page 1)

I agree completely. Employee disengagement is a tragedy and is pervasive in the modern workplace. A friend of mine often says of his company that “they pay you just enough to keep you from leaving.” What a horrible way to treat employees.

The biggest reason that employee disengagement is important is because of what it does to people. It creates the “quiet desperation” of the modern workforce that we see all around us. It also has a financial cost. I found it really interesting that this cost can actually be quantified:

If on average your employees are 75 percent engaged, disengagement is costing you 25 percent of your payroll every month in productivity alone. The real cost to your business is of course much higher when you take into account how disengaged employees negatively affect your customers and every aspect of your business. (Page 2)

There are some very effective, and simple, solutions to the problem of employee disengagement. I think it is one of needs of the hour, and in one sense that is going to be a major component of what this blog is going to be about.  And for those interested in a helpful book on the topic in the meantime, The Dream Manager is proving to be a very good read.

The Root of Making Good Decisions

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There are lots of different formal and informal approaches to making decisions. But at the end of the day making a good decision comes down to one thing: Knowing the fundamental governing principles of the area. Usually there is just one.

For example, as I posted earlier today, with the economic policy of a nation, the governing principle is to maximize people’s freedom to the greatest extent while preserving the rule of law. In deciding where to work, the guiding principle is: where can I have the greatest impact with the gifts I’ve been given? In managing an organization, the guiding principle is to make employees’ strengths productive for the performance of the organization while minimizing weaknesses.

Once you understand the governing principles of an area, most decisions fall into line. More on this in the days and months to come.

How to Get the Mail

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Here’s one of the most basic productivity functions of all, and yet probably most of us never think about how we do it: Getting the mail.

I actually have to go get the mail right now. Why don’t I go do that, and then I’ll come back and summarize how I go through it.

Processing the Mail is the Same as Processing Your In-Box

OK, here we go. First, I’d normally actually just put it in my in-box, since it’s the middle of the afternoon, and process it the next time I process my in-box. And that’s the first point: The mail is just another form of input to be processed along with every other form of input you get. So in one sense I could stop this post right now, because getting the mail really reduces to processing your in-box. But, I will continue.

The Three Rules of Processing Stuff

Second, I go through the items one by one (very quickly). Looks like I have about 15 items. David Allen gives the three cardinal rules of processing, which apply here:

  1. Process the top item first
  2. Process one item at a time
  3. Never put anything back into in

The Two Questions when Processing Anything

Third, with each item I ask myself two questions: What is this? and What’s the next action? This is because before you can know what to do with something, you need to know what it is. Once you know what it is, you can determine how to handle it (that is, define the next action).

When No Action is Required

With most stuff, this is easy and takes about 0.25 seconds. Some things have no actions required. For example, an item of junk mail gets trashed.

Handling Quick Actions: The Two Minute Rule

Some things involve very quick actions. With these I apply David Allen’s “two minute rule”: if you can do it in two minutes or less, do it right away. So a newsletter or such from an organization I give to gets a quick look, for example, and then I toss it (or determine the larger action required by it and process it accordingly).

Handling Longer than Two Minute Actions

Then there are some things that involve more than 2 minutes of action. I have something in this category before me right now: the statement for my money market account. I have actually noticed that 90% of my 2-minute plus actions that come up fall into 1 of 6 categories. I’ve set up a group of pending files for these: bills to pay, notes to process, receipts to enter, other financial to enter, to read, and to file. This one falls into the “other financial to enter” category—I need to reconcile this with my Quicken–, so I put it in that file. (I go through those files every Saturday, by the way—I wouldn’t put anything in an action file without a regularly scheduled task to actual dispense of those actions. I put these regularly scheduled actions on my “action calendar,” which I’ll talk about down the road)

Now I have before me two post cards that the grandparents sent to our kids (ages 5 and 3) while they were on their trip to DC. I put these to my right in a temporary “out” pile, which is where I put stuff that I need to give to my wife or kids or take somewhere else in the house.

The next item is my 2009 vehicle tabs. Here I have two things to do: The stickers themselves go in my “out” box, and I will put them on my car when I take that stuff to where it goes. But I also want to keep the registration card that came with them, so I put that in my “to file” pile.

The next item is something from Dish Network saying I have to upgrade my DVR with these new smart cards they’ve sent, or it will stop working in two weeks. Good grief. This is why life is so complicated and we need productivity systems in the first place.

Now I have my IRA statement. There is a newsletter with an article on “what you need to know about bear markets,” which I’ll give 10 seconds to. There is also an update to the “custodial agreement” (whatever that is). In previous years I probably would have filed that with my IRA stuff, but I’m getting tired of the information glut, so I’m just going to throw that away. I put the actual statement into my “other financial to enter” file.

Now I have my mortgage statement. We’re not on automatic withdrawal because we plan on moving soon and I wanted to save the time of setting that up. Not sure if that actually saved me time, but oh well. I put the bottom portion in my “bills to pay” file and the actual statement in my “to file” pile.

There are a few magazines that I put in my “to read file,” and now I’m done. Now what I’m going to do is quickly take my “out” stuff where it goes (put the post cards for our kids in my wife’s in box, the tabs on the car, and that smart card in my DVR), file my “to file” stuff, and get on with my day. On Saturday morning I’ll clear out the two minute plus actions that I put into my “other financial to enter” and “bills to pay” files.

Nothing this time involved a project (a more-than-two-action outcome) or had to go on my next action list. Down the road I’ll be posting some about those lists and how to use them effectively.

Forward-Thinking Leadership

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I was at the Catalyst 2008 conference at the end of last week. The speakers included some top-notch business thinkers, including Jim Collins, Seth Godin, and Tim Sanders. Andy Stanley gave a very useful talk based around five really intriguing quotes. Here are a few of them:

“What do I believe is impossible to do in my field…but if it could be done would fundamentally change my business?”

“If we got kicked out and the board brought in a new CEO, what would he do? Why shouldn’t we walk out the door, come back in, and do it ourselves?”

“When your memories exceed your dreams, the end is near.”

Here’s what I like about these quotes: They focus not only on doing existing things better, but on doing new things altogether. We need more people thinking along these lines.

What This Blog is About, Part 2

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There are a lot of blogs on productivity. So why start another one?

This comes down to the question of the angle this blog will take. There are a lot of great productivity blogs out there. Lifehacker hits productivity from the technological angle, Merlin Mann at 43 Folders writes about how to find the time and attention to do your best creative work, and Timothy Ferris writes about experiments in lifestyle design. So what’s my angle?

The most basic answer is that I am looking at productivity through the lens of decision-making. Being productive and effective is about making good decisions. Your calendar and projects list, if you have them, are ultimately decision-making tools.

The angle of this blog is also unique in the way it will try to tie together some divergent themes that nonetheless need to go together. Here are the things I want to tie together in this blog:

  1. Personal productivity and organizational productivity.
  2. The runway and the 50,000 foot level.
  3. Sound thinking and helpful action.
  4. The past and the future.

Tying Together Personal Productivity and Organizational Productivity

This is what I talked about in part 1 of this article and in my post “Broadening the Concept of Productivity.” In sum, I think productivity is not just about making ourselves more effective, but about knowing what will make our organizations and communities and society more effective. So I’m going to talk about not only how we can be more productive as individuals, but also how our organizations and communities can be more effective as well.

Tying Together the Runway and the 50,000 Foot Level

Here’s my productivity journey in a nutshell: David Allen’s Getting Things Done opens up a whole new world. Yet there are a few “snags” that I think the system has (which can be overcome). One of the snags is that GTD is great at the runway and 10,000 foot level (projects), but is less developed at the 20,000 foot and above level (roles, goals, and mission).

Stephen Covey’s books The 7 Habits of Highly Effective People and First Things First, on the other hand, are superb at the 20,000 foot and above level. Yet they are weak in laying out a workable system for translating those plans into action at the project and next action levels.

What is needed is a productivity approach that synthesizes the best of Allen and Covey. I think I’ve done this for my own productivity system that I’ve built for managing my own life, and will be blogging a lot on how these two perspectives fit together. The result is a system of thinking that successfully ties the big picture (20,000 foot and above) to the every day (the runway of next actions and 10,000 foot level of projects).

Tying Together Sound Thinking and Helpful Action

In one sense it’s a bit odd that I’ve named this blog What’s Best Next, because that sounds almost like all I care about is what we do, when in reality I am a firmly believer of the primacy of thought. Not as a replacement for action, but as the director and leader of what we actually do. I think we make the best decisions on what to do when we understand the guiding principles of an area.

This is in now way, in no way, to say that thought alone is sufficient. It is to say that the most effective actions stem ultimately from the way we think, and if you approach anything piecemeal, you are unlikely to get good results. I love this quote from Roger Martin’s book The Opposable Mind: “Instead of attempting to learn from observing the actions of leaders, I prefer to swim upstream to the antecedent of doing: thinking. My critical question is not what various leaders did, but how their cognitive processes produced their actions” (The Opposable Mind, p. 19). Great thinking is the seedbed of great actions. This blog is about what’s best next, not just what’s next.

Tying Together the Past and the Future

And of course this blog is not only about what’s best next, but also what’s best next. We are looking ahead—both far off to what are the most productive actions for the long-term, as well as how to make the best decision about what to literally do next.

I love how Jim Collins relates that when he would ask Peter Drucker what the favorite book he wrote was, Drucker would always say “the next one.” That’s how I think: the best things are always to come. And knowing what’s best next requires knowing what came before. We have a ton to learn from the past. I want to think of what’s best, next, in the context of the whole.

Broadening the Concept of Productivity

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A lot of the advice I read on starting a blog said to narrow your topic as much as possible. That is good advice. But in one sense I’ve chosen to do the reverse.

I think we need to broaden the concept of productivity. Instead of thinking mainly in terms of making ourselves productive, we also need to think in terms of making our organizations and society more effective. This is really one of the ultimate goals, and most exciting things. The goal of personal productivity does not terminate on yourself, but is a means to being a useful person who makes the world a better place.

Hence, I define productivity as not only making yourself more effective, but making others more effective—our organizations, our communities, and our society.

What This Blog is About, Part 1

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This blog is about two things: (1) how to best manage our lives and work and (2) how to best think about the way that the businesses and non-profits that we work for should be run. I guess we can call these two things “personal productivity” and “organizational productivity.”

Personal Productivity

Originally I wanted to start this blog 4 years ago and focus on personal productivity. I had read David Allen’s Getting Things Done and put together a planning system to help me keep on top of my goals, projects, and next actions, and wanted to blog about that. I also found that the concepts for organizing time and tasks easily expanded into best practices for managing space, such as your desk or garage or kitchen. I thought that it would be pretty fun and helpful to blog on how to manage your time, projects, and space—basically, your life. But of course…I never had the time.

Organizational Productivity

Now it’s 4 years later and I’ve been doing a lot of reading on and gaining experience about managing organizations. I read about 50-100 books a year, and for the last couple of years business and management (“organizational productivity”) have been my major focus. I think Peter Drucker is right that the greatest challenge of this century is to make knowledge work productive. Most of us are knowledge workers these days, yet most organizations are not managing knowledge workers effectively. They are using practices from the industrial economy to manage the knowledge economy. The result is incredible loss of potential (the authors of Mobilizing Minds estimate this in the hundreds of billions of dollars) and, worse, the quiet desperation of our workforce. A massive number of people feel that their work lacks significance, and slog through their day just to make a living. But there is a better way.

Broadening the Concept of Productivity

So the question I asked myself was: Should I blog on how to manage our lives better or what it would look like for the organizations we work for to be managed more effectively? And, of course, my answer was: “both.”

For these are really two sides of the same coin. Those who lead organizations cannot be effective if they do not know how to manage themselves and all the input that we all face every day. Likewise, if we are effective in managing ourselves, that is not the whole picture. The point of personal productivity is to be a useful person—and this implies that we all have an interest in understanding what makes organizations effective and how we can bring the businesses and non-profits that we work for farther along that path.

So the meaning of productivity is much more broad than just making ourselves more effective. It includes what we do with that–how we can make our organizations and society more effective.

This is Exciting

I think this is exciting. We have a chance to not only become more effective in our own lives, but to help our organizations and, ultimately, society become more effective and useful. I asked my wife if she would rather read a blog about personal productivity or doing things better in business and management. She is a nurse who currently stays home with our kids, so she doesn’t deal with the whole organizational management side of things. Yet she said, “Both. It’s all relevant to me when you talk about it, because I see how the organizational side of things affects me and the people who work in organizations.” I hope that you all have the same experience reading this blog, whether you lead an organization, work in middle management, are just starting out, or are even a stay-at-home mom.