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The Price is Right: Cracking the Code of Productivity

Leading a highly productive organization—that’s every executive’s dream, isn’t it? But here’s the catch: it’s like herding cats. I mean, have you ever tried to herd cats? Exactly.

In my line of work, productivity issues pop up like whack-a-mole. Weak leadership, lousy tools—you name it. Clients think tech can magically fix these bumps and potholes on the productivity road. Some even go all out on training programs, as if a few webinars will turn Bob from accounts into Steve Jobs. Spoiler alert: it won’t. Enter Price’s Law.

Understanding Price’s Law: The Square Root of Productivity

Price’s Law—the square root of productivity. Sounds fancy, right? Derek J. de Solla Price, who probably had too much time on his hands, came up with this in ’65. He basically said that if you have 100 employees, about 10 of them will do half the work. So, next time you’re in a meeting with 100 people, look around. Ten of them are actually doing something. The rest? Well, they’re probably forwarding memes.

This isn’t just office gossip. It’s everywhere! Academia, business, creative industries—yep, same story. It’s like we’re all part of one big, inefficient sitcom.

Then there’s the Pareto Principle—the 80/20 rule. It’s like Price’s Law’s less nerdy cousin. It says 80% of the effects come from 20% of the causes. Both say productivity is uneven, but Price’s Law is more like, “Hey, let me give you a precise math equation to show you just how much everyone else is slacking off.”

The Origins of Price’s Law

In the 60s, Price noticed that a few scientists were making most of the significant contributions. So, while everyone else was pretending to read their emails, these folks were doing all the actual work. Thus, Price’s Law was born and applied everywhere. Sales teams, coding departments, universities—you name it.

Organizational Structure Implications

Businesses can learn a thing or two from this. In a sales team of 100, about 10 people will close half the deals. The rest are probably just updating their LinkedIn profiles. Managers should identify their top performers and maybe, just maybe, reward them. Shocking idea, I know.

As companies grow, the number of genuinely productive people doesn’t keep pace. You end up with more dead weight, and things slow down. So, the key is to create an environment that keeps those top performers happy. Maybe don’t give them an open-plan office right next to the kitchen, yeah?

Real-world examples? Sure. In a research lab with 100 scientists, about 10 will come up with the groundbreaking stuff. The rest? Well, someone’s gotta make the coffee. In a tech company with 200 developers, about 14 will write the code that actually matters. The rest are probably arguing over tabs vs. spaces. In academia, out of 40 professors, around 6 will publish the papers that get all the citations. The rest are perfecting their PowerPoint animations.

Critics argue that Price’s Law simplifies complex human behavior. No kidding! But, even with its flaws, it’s a handy way to understand productivity.

Take Aways

Price’s Law offers a compelling perspective on productivity and performance within groups. By recognizing that a small number of individuals often drive a significant portion of the results, organizations can better allocate resources, identify top performers, and create environments that foster high performance. While it is not a one-size-fits-all solution, Price’s Law provides a valuable framework for understanding and refining productivity in various domains.

So, takeaway time: Price’s Law tells us that a small group often drives the bulk of the results. Spot these people, reward them, and don’t let the other ones drag the whole thing down. Easy, right? Well, it’s a start.

October 16, 2024 Posted by | Uncategorized | , , , | Leave a comment

Are you a chicken or a pig?

Chickens and pigs, both wonderful animals that contribute to healthy, delicious breakfasts all over the world. Many years ago, when I was a young professional, one of my mentors would tell the story of breakfast. It goes like this. When you look at your morning fuel plate it’s not unusual to see bacon and eggs sitting in front of you.  Consider the contribution of the chicken and the pig. The chicken is involved in the meal by offering a fresh egg.  The pig is committed to its involvement.

Which are you? Do you commit to change or are you involved? The difference is stark.

Chickens use words like buy-in and alignment to affirm that they’ll work to make a change successful. Soft words with soft meanings imply that you’re sort of going to do things that contribute to the goals of the necessary change. You’ll be involved in the work, but if the work gets too hard, maybe you’ll quit on the efforts. Chickens need multiple enticements to stay engaged and really work to achieve the stated goals. Chickens will move the goal posts of the change just to declare success. Most people involved in transformation programs are chickens. It’s just human nature to be cautious and leave options open.

Pigs on the other hand are all in. They use words like commitment and must do. Pigs put everything they have into the effort without enticements because they believe in the ultimate vision. Pigs don’t let obstacles move the goal posts. Pigs persevere through the challenges, make sacrifices, and never relent. Achieving the goals of transformational change sits at the top of their to-do list. Every change effort must have leaders that represent the characteristics of the pig. These are the change agents, the visionaries, the evangelists.

Imagine if every team member was committed to a change effort versus being involved. The success rate of change programs would skyrocket. Visions would be achieved at a higher rate and returns on investment goals would be beaten.

Just a few tips to garner commitment:

  • Set clear goals for the change effort. Words to describe and metrics to achieve.
  • Align incentives for goal achievement.
  • Communicate expectations clearly. Achieving genuine commitment requires clear communication of expectations, goals, and responsibilities.
  • Build a roadmap of actions together with all the stakeholders.
  •  Assign accountabilities for all actions with clearly defined results.
  • Measure progress frequently adjusting as needed to maintain commitment.

May 21, 2024 Posted by | Thinking About Change | , , , | Leave a comment

College Sports Transformation: A Lesson for Business

In 1976 I joined the Michigan State University Sports Medicine staff as a 17 year old freshman. It was my dream, all I ever aspired to do was support high level athletes in their pursuits. The experience I gained in just one year was phenomenal. Working with Big 10, yes there were only ten schools in the Big Ten at the time, athletes, physicians and Athleteic Trainers shaped much of my life. I loved collegiate athletics. Not any more! I can barely follow Division 1, FBS schools without shaking my head.

The transformation from an extracurricular activity that allowed opportunities for gifted athletes to achieve an education has turned into a full-on business endeavor for college football and basketball. Now, the gymnasts, fencers and swimmers still go to class and take advantage of the athletic scholarships. These athletes ride around in vans, stay in cheap hotels and remain uknown to most people. They complete their studies at a high graudation rate and become contributing members of society, as far as I know competitive fencers don’t demand $20 milllion contracts.

Over the past few years with the introduction of Name, Image, Likeness (NIL) contracts and the Transfer Portal the landscape in collegiate athletics has been entirely transformed. It’s a new world. So new that coaches are retiring, fans have not idea who actually plays for their Alma Mater from year to year and female athletes take a pay cut when they go pro.

The immediacy of the transformation has been so dramatic it makes any commercial business green-eyed with jealousy. So let’s break it down and do some comparison between the collegiate athletics transformation and a typical business transformation.

OBJECTIVE

Collegiate Athletics: Generate growth for the institution and individuals through enhanced revenue.

Business: Generate growth for the business through enhanced revenue.

STAKEHOLDERS

Collegiate Athletics: Institutional Leadership, Athletic Directors, Media Outlets, Individual Athletes

Business: Business Leadership, Shareholders

INVESTMENT

Collegiate Athletics: ZERO (any and all new costs are borne by commercial investors)

Business: Varies by magnitude of transformation and company size. Let’s throw a number at it from my experience in the large enterprise space of $100-$200 million off the bottom line.

COMMITTMENT TO END STATE

Collegiate Athletics: Extremely High, little or no resistance to adoption

Business: Dependant on multiple variables. In most cases resistance is typically high in the early stages as committment to end state is high. Over time resistance becomes higher, if not managed correctly, and committment wanes.

SPEED TO VALUE

Collegiate Athletics: Immediate following court decision and contract negotiations with athetes

Business: On the balance a major transformation time to value is 3 to 5 years.

LEARNINGS

Transformation, when driven by legal means, can be fast and furious much like the whirlwind caused by Sarbannes-Oxley following the Enron debacle. When a transformation is driven by a vision for the future without the stick of legal or regulatory rules the pace is slow, the investment high and the speed to value lengthy.

Conceptually the “burning platform” for change should always carry both a positive result and a negative outcome. Many times a business contemplating transformation will focus only the potential positive outcomes. Putting some fear into stakeholders about the negative consequences of transformation assists the psychological acceptance and adoption of the future vision.

What’s In It For Me (WIIFM). Student athletes are all in! They see dollar signs everyone for themselves personally. University leadership sees millions of dollars flooding into their coffers from media contracts. The WIIFM is clear and strong for collegiate athletics. In business the WIIFM is much softer and more challenging to quantify. Most workers in a business see very little gain from a major transformation. Possibly some reduced manual labor or the promise of contuing employment with the opposite also being in the back of their minds of automation replacing their employment. Leadership and shareholders hope that the transformation moves faster than market forces.

The primary learning from the rapid transformation of collegiate athletics is that a clear message resonates, backed by significant risk of non-adoption with strong WIFFMs for all the stakeholders impacted.

Take a strong, committed stand to your transformation efforts. Tell an honest story that articulates both the positive and the negative. Drive ahead at mach speed, do not delay the change.

April 16, 2024 Posted by | Uncategorized | , , , , , , , , | Leave a comment