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Opportunity Cost: The Choice is Yours

I recently heard from a friend about an “urgent” request from her manager. He requested an increase in the frequency of a report which – admittedly – almost no one in the management team even read at its current cadence. “But why?” he asked. Apparently that was the wrong answer – the fact that it was recommended from the manager-on-high should have sufficed to rationalize what would be a doubling of effort for ostensibly diminishing returns. The trigger for this (miscalculated) request – an offhand comment a friend of the manager’s had made about her own team – led to the worst possible outcome: guidance made in an irrelevant context, precious / limited time spent, a deliverable that was underutilized, employee disengagement upon seeing the lack of impact from her incremental new work, and perhaps most devastatingly – a sudden lack of faith in the manager’s judgement and decision-making. There are literally not enough hours in the day to do all the work possible, especially in a start-up lean on resources. But thinking through the key criteria – usually 1) what is urgent and 2) what is important – can shed dramatic, sometimes downright uncomfortable light on where time should really be spent. As inelegant as it sounds, time actually is money (a thought: what if paychecks were physically handed out by managers? hourly? When the cost is physically and immediately felt, I imagine those leaders would be much pickier about what that past hour was spent on!). The incremental benefit / impact of the above mentioned report request was negligible, with costs (time, money, credibility, trade-offs from other priorities). Sometimes there are things that pile on in between – a customer request for example – and that’s ok. The key success factor here is that manager and their team have an agreed upon system or set of criteria – e.g., does this help the team? Does it drive impact? Does it make things better for the customer, either directly or indirectly through better-decision making? Such a set of criteria is ideally something formulated together or aligned upon, so that the whole team feels not only bought in but also empowered to make decisions on where to spend their time. Opportunity cost, spending time on one area at the cost of another, is very real. For example Bill Gates could probably manage his calendar and schedule meetings exceptionally well – but isn’t his time better spent on helping develop technology, or investing how to cure global diseases? Having an assistant solves that  very real opportunity cost. Taking a step back, when a team’s vision and mission is clear, it helps inform their strategy – literally the art of decision-making among finite resources. From there the tactical considerations for day-to-day activities become much more clear. If your strategy is focused on, for example, maximizing short-term profit, the prioritized set of activities that drive toward that goal should be very different than if your strategy is, say, long-term social impact. Maybe your to do list is in a notebook, in Evernote, or just in your head. But take a week to work with an eye toward honest prioritization. Is it a new report to pull together? Or a meeting to coach someone on an important topic? Or talking with customers? There’s a classic hip-hop song called “The Choice is Yours” with its refrain – “You can get with this, or you can get with that.” It’s simple but true, every activity is actually a choice. Ultimately organizations with clear visions and transparent priorities have teams that are best equipped to make decisions among those choices.

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─ February 4, 2016