That sound you hear in the office, in the conference rooms, and in the field is the passing of time.
There’s only so much of it every day, and it’s a resource that HAS to be considered in every single decision we make.
Because of this thing called “opportunity cost” – that is, what you’re losing (or not gaining) by NOT doing something else at that given moment.
Leaders who fully understand opportunity cost can see, in their mind’s eye, the “layers” of revenues and costs that exist on their to-do lists, project status reports, and business plans. It’s like putting on a pair of 3-D glasses.
Once things get filtered through those lenses in 3 dimensions, there exists a constant state of urgency that serves as a wonderful inducement to move things along with what I call “deliberate speed”.
It’s really the mathematical underpinning of good and efficient decision-making. But it’s not easy to master.
That’s because there’s something out there that’s constantly attacking our precious time, and our ability to keep our 3-D glasses on – I call them the “black holes”.
These are things that we get sucked into that obliterate everything else in its path, the glasses fly off, and common sense is suspended.
Here are a couple of examples:
“The Fire Drill”: Your boss calls about a negative customer comment he read on the Internet, and demands that the situation be resolved immediately. You are now in the black hole, because you immediately drop what you are doing to attend to the boss’s request.
The “Process Speed Bump”: You just signed a letter of intent on a contract that would immediately save the company $20,000 a month. All it has to do is go through the final approval process. However, the contract gets “stuck” in legal for what seems like weeks, going back and forth on certain provisions that are “policy” but have no bearing on the financial benefit.
In both of these cases, the concept of opportunity cost is suspended (i.e. your 3-D glasses come off). You KNOW there are more beneficial things you could be doing at that moment, but you are stuck in the black hole.
And you clearly hear the “tick, tick, tick” again, and this time it’s the sound of losing money.
How can we avoid the black holes, and keep our 3-D glasses on, thus not wasting our most precious resource?
Here are three important things we can do:
- Don’t forget to take the 3-D glasses into the meeting rooms – All too often opportunity cost fails to make it out of the offices and into the conference rooms, so black holes can proliferate there, resulting in long, unproductive meetings that can create more problems than they solve. Everyone on the team, including the highest level executives, must commit to taking the proper 3-D mindset into the meetings, and be held accountable for any black holes they create.
- Create processes that are created with concise 3-D clarity – The more approvals that are needed (and thus the more humans that must get involved), the greater the chance of a black hole. We must take greater care to craft our internal processes, and eliminate unnecessary or redundant steps. And once we do, make sure all the costs and/or benefits are clearly delineated in a “cover sheet” for all to see (with their 3-D glasses on, of course).
- Trust the folks wearing the glasses – Leaders need to recognize when their teammates are wearing the 3-D glasses, because when they do, they can be trusted to make good decisions. That kind of trust results in more distributed responsibility and less “command and control”, which is a huge black hole generator.
Learn how the concept of opportunity cost works in your workplace, and get those glasses on. You’ll be a more effective (and decisive) leader.