THOUGHTS ON PRODUCTIVITY

By Tor Dahl

Volume 1, Issue 5 May 3, 2004

“An experiment,” said my old statistics professor, “is a sacred invitation for the universe to appear, to manifest.”

In an early project, a group of employees in Minnesota had decided to find out how productive they were at work. Being Minnesotans, and mostly Lutheran, they agreed to respond to random signals about 30 times during each work day. Each and every time they received a signal, they registered how productive they thought they were at that moment. They also registered how satisfied they were, how stressed they were, what time of day it was, and answers to a number of other questions.

For the first time we would find out what people were doing when they felt productive, and what they did when they felt unproductive. Knowing this should tell us, and everyone else, what we should aim for if we wanted to improve workplace productivity.

When Ruth Knapp, our computer expert, returned from the Control Data 6600 computer (the world's largest computer at the time, but now essentially comparable to my desktop computer) we all eagerly gathered around her for the results. Ruth is a laconic Minnesotan. She is also brilliant.

Scientifically speaking, it is a technical term that says that there is at least one linearly dependent variable in the data, thereby making it impossible to invert the matrix that will solve the least squares regression equation.

If every time you registered “waiting time” you also rated your own productivity as “zero”, then “waiting time” means that you are always unproductive when “waiting time” occurs.

In some sense, “waiting time” must be directly and 100% connected to productivity. But it would be opposite to productivity, wouldn't it? So the opposite of “waiting time” is likely to be part of productivity.

The opposite of “waiting time” is “occupancy”. Occupancy doesn't mean that you are effective or even efficient. You could be rearranging deck chairs on the Titanic! But, occupancy is the most important challenge for businesses like restaurants, hotels and hospitals striving for higher productivity. It's what Joel Hodroff addresses with his “dual currency” (www.dualcurrency.com), where merchants in the community allow you a discount if you come to their places at hours when their occupancy is low.

We were all crestfallen at Ruth's announcement. We had a deadline to meet. I asked Ruth to check the data again, but if we still could not run them, to delete the variables that caused the problem. Ruth went back to the computer center.

But the Universe was trying to tell us something! We had stumbled across something that was very, very important, but we didn't grasp what it meant at the time.

In the years that followed, thousands of people responded to random signals at work and faithfully registered their productivity ratings against more than 300 different questions all relating to their behavior, attitudes, judgments or feelings at work. Six PhD dissertations were written about these findings, and we finally understood what we were doing.

Among all the variables we tested, 5 stood out like sore thumbs. They consistently and predictably stopped the flow of analysis, just like Japanese assembly line workers who pulled the cord that stopped the line each time something went wrong.

By reversing them, we actually arrived at an operational definition of productivity.

We tested and validated these findings. At the World Productivity Congress in Montreal in 1988, we submitted them to some very bright people for their opinions. We discussed it for days. Early one morning, before the Congress ended, we had forged an agreement. It was incorporated into the Montreal Declaration (see www.wcps.info). It was a major breakthrough for those of us who have to work in the vineyards of our field.

That is the strategic decision. A company may well make a “do or die” decision when they fully commit themselves to a certain product or service.

To pick the right output, you must get rid of everything that you should not be doing (screening). Then you must get rid of everything that would best be done by someone else (delegation, or outsourcing), and when you are left with what you should do, you should extend that beyond the moment, so planning completes the drive to do the right thing, or as we call it, achieve effectiveness.

Only now is it relevant to consider efficiency. Who cares how efficient you are if you are doing something no one in the world should be doing? You might end up doing the wrong thing, perfectly!

Efficiency is doing the thing right. It is irrelevant if you are not doing the right thing. It is interesting to note that most of the articles and books on productivity deal with efficiency. I think it is because it is much easier to measure efficiency than effectiveness. What we measure is what gets done.

Occupancy is also easy to measure. We always know whether you are doing something or not. Occupancy is the concluding part of being productive. You are now doing the right thing in the right way all the time. The five variables - screening, delegation, planning, efficiency and occupancy - were the variables that correlated perfectly with self-rated performance in our early work.

At any point in time business fashions dictate the focus on these elements of performance. Outsourcing is a large issue right now. So is six sigma, which focuses on eliminating error and waste. That is what screening is all about. Planning was the winning strategy in the first Gulf War. Kaizen, or continuous improvement, focuses on efficiency.

But the greatest challenge is always effectiveness. That means picking the right output.

Screening, delegating, better planning and higher efficiency allows you to free up a tremendous amount of resources.

It is where you put these “freed resources” that determines if you will survive or not, and if you will thrive or not. The life expectancy of a stock-registered company is only 44 years. There is a very high failure rate for companies that pick the wrong outputs.

My field of economics says: Pick the output that will yield the highest return! For monetary returns, that would likely be whatever produces an earned monopoly advantage for your company, where you could set the price you want for a good or service that you could sell. Or to pick an output that you could profitably sell for less than anyone else.

For you as an individual, I believe that everyone carries their own monopoly advantage in their mind, or heart, or body. I believe that to find that advantage, and develop it, is the path to the greatest contribution that we can make on this earth. I believe this is what the great researcher of myths and legends, Joseph Campbell, means when he advises us to “Follow Your Bliss!”¹.

In a cramped office on Nicollet Avenue in Minneapolis in 1973, Ruth and I struggled to make sense of the inscrutable feedback we received from our data. I visualize now a gently prodding presence, of mysterious but wise ways, time and again tapping us on the shoulder and saying: “Wake up! I'm trying to tell you something! This is really important”.

One of our previous newsletters spurred a response from Dr. Paul Quie, a University of Minnesota Regents' Professor, the highest honor the University can bestow upon one of its faculty. He told me about how he, as a young student at St. Olaf College, received high grades for math and chemistry. He knew then that he had a chance to be accepted into medical school. Dr. Quie became a world-renowned specialist on infectious diseases.

Upon his “retirement”, he shifted his focus to the medical students at the University. He discussed career choices and opportunities for them so that they could participate in clinical electives anywhere in the world. He writes, “The students' enthusiasm, optimism, sense of adventure, and genuine concern for people are truly contagious”.²

Paul Quie is looking for the invisible drawing in each student. What a joy it must be for a student to have someone tap them on the shoulder and say: I know what you can do! Wake up to your potential! This is really important!

And in Paul Quie's cramped office, next to the Office of the Dean of the University of Minnesota Medical School, very major discoveries are being made, one individual at a time.

“The important thing is this: to be able at any moment to sacrifice what we are for what we could become.”
- Charles Du Bos

Leading, innovative companies understand the power of productivity as the strategy for achieving greater corporate performance and bottom line results. Yet, most companies do not apply a systematic and rigorous process for realizing their untapped productivity potential. 80% of all corporate initiatives focus instead on efficiency improvements that are not tied to overall growth objectives and do not produce any breakthroughs in performance. Productivity improvement, on the other hand, is so highly leveraged that even small increases can dramatically affect revenue, cost effectiveness and profits, while raising employee satisfaction and customer delight. For publicly held companies, stock prices and market capitalization can increase dramatically.

Tor Dahl & Associates is the world leader in this “new” field of productivity. We have debunked the old myth that productivity takes away jobs and that it is only concerned about “doing more with less”. Our successful productivity strategy is rooted in the fundamental belief that productivity is about removing barriers to individual performance, freeing up resources from unproductive processes and reallocating those resources to higher yield activities that support organizational growth objectives. It is a positive method that leads to greater earned competitive advantage, increased job satisfaction and positive employee engagement, rather than job losses and downsizing.

Tor Dahl & Associates is now offering a condensed seminar to corporate teams where the fundamental principles of productivity will be taught and practiced. It is an enjoyable, stimulating, practical and valuable session that identifies key factors that impact productivity and how your organization can apply this insight to make dramatic improvements in personal and organizational performance. Contact us now to put this Seminar to work to make your organization soar.

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1Joseph Campbell, The Power of Myth, pp. 120, 149.

2Private communication received from Dr. Paul Quie, April 1, 2004.