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Disrupting Efficiency
There is nothing more wasteful than making more efficient a process that should have never existed in the first place.
We need to distinguish between internal incremental efficiency and customer driven disruptive efficiency.
The former (incremental efficiency) makes scant if any changes to what the company outputs, but rather focuses on spending less time and resources producing it.
The latter (disruptive efficiency) uses an efficiency approach making dramatic improvements to the customer experience, customer and business outcomes amplifying what brings value while identifying and removing what doesn’t.
Disruptive efficiency removes or reduces waste from interactions with customers by eliminating what customers don’t need, value or what doesn’t bring value back to the business.
Sure, we can continue to spend time and resources on incrementally improving the speed, seamlessness or linearity of our own internal operations (e.g. let’s reduce how much time we spend making one piece of content). But why would we waste time making redundant processes more efficient when we should be removing them entirely?
e.g. 89% of Health Care Professionals (physicians) would likely or very likely change their prescribing behavior based on viewing peer-reviewed content in its original form as it was published versus only 7% in case content is summarized or re-written by pharma. — New England Journal of Medicine
Why spend millions making processes more efficient, when the obvious approach should be to stop creating experiences that have no value no matter how efficiently we can perform them?
How to do it:
Disruptive Efficiency is customer centricity on steroids. But instead of using the customer to generate new value we use the customer to remove waste.
Three elements are needed for Disruptive Efficiency: insights, strategy and measurements.
#1. Insights
One of the main reasons we are not making these obvious efficiency gains is because we can’t see them.
Because most of us aren’t asking questions to understand our customers. Instead we are predominantly asking questions concerned with our own perspective, processes or products.
I used to do some work for a hotel brand and when I asked them how they would improve their guest experience they gave me tons of ideas about the process of collecting a booking and welcoming people to the hotel. But when I asked how to improve the room experience specifically they gave me blank stares. Why so many ideas about booking a room and so few on how to experience it? Because the hotel chain had tons of data on the booking process, but no data about the use of their rooms. So when I asked them what to improve they retreated to what they had data and language to describe: online booking, check-in and check-out.
The first step in disrupting efficiency is therefore to disrupt our own data and research. We need to make sure we can see what our customers sees through their eyes (e.g. a physician sees the life of the patient through the lens of their disease, while the patient sees their disease through the lens of their life).
Understanding this difference is vital. E.g. if we are looking at channel performance data like click-throughs, open rates or content tags and assume we are looking at our customers we are not getting it!
One of my former bank clients went to his managers suggesting that everyone at the bank was looking at their customers through the lens of bank services. He boldly suggested that at least one person should be able to look at bank services through the lens of their customers. They agreed and he was able to set up and run an awesomely insightful project into what money means to people’s identity, meaningfulness and ability to thrive.
To summarize: we need to make sure we see the customers world through their lens. But we can only achieve this if we ask questions to better understand our customers jobs, situations, needs and desired outcomes.
“We must try to put ourselves inside their skin and look at us through their eyes just to understand the thoughts that lie behind their decisions and their actions.” — Robert S. McNamara paraphrasing Tommy Thompson during the Cuban Missilie Crisis, The Fog of war
With the right and deep insights in place seeing the first opportunities to make efficiency gains would already be obvious.
But there is more..
#2. Strategy
If you don’t know where you are going any activity will do the job.
We underestimate the effects of poor strategy by a mile and more. Bad strategy is easily one of our greatest sources of inefficiency. Like a vessel without a rudder accelerating into unwanted turns.
But what is strategy: strategy is decisions made in order to win in environments which we can’t control. It is often confused with an ‘important’ plan. But a plan in comparison is the orchestration of what we can control in order to deliver on the strategy (R.Martin).
e.g. in military battle the strategy could be to take the South Hill by dusk gaining the upper hand. But how we take the hill and all the changes and adjustments needed in the heat of battle, that is planning. Maybe eventually the South Hill becomes impossible to take or it looses its ability to be the upper hand .. then we change the strategy.
A customer centric strategy needs to answer what competencies we will combine producing what unique value motivating which behavioral change delivering the desired outcome to both the customer and our business.
Doing this the team will know:
- Which customer needs are relevant and which are not
- Which customer behaviors are relevant and which are not
- Which customer value propositions are relevant and which are not
- Which internal competencies are relevant and which are not
A good strategy is very good at pointing out what to stop doing. There are plenty of efficiency opportunities in good strategy.
Side note: A good strategy is informed by good insights. Product centric research won’t help you answer any of these questions. So a good test on your research is how clear the answers to these questions are based on what the research is selling you?
Holding teams accountable to a good strategy is essential. If teams are not held accountable then why would they care (this is only human). They would write a few jargons, use some key words, produce three Jenga-style power point slides, present and we’ll all forget all about it.
A good strategy should clearly say what to stop doing and is foundational to efficiency.
Unfortunately too often we don’t ask the right questions to get the right insights informing the right strategy. Or we don’t use the strategy to answer the right questions and are not held accountable by the right measures.
#3. Measurement
The last leg of disrupting efficiency is measurements that matter. We need to measure our ability to deliver on the strategy in order to, with brutal efficiency, stop doing what is not working, do more of what is working, and be able to respond to any unknown unknows.
If we don’t measure properly we will be staring into the fog. Not knowing what is happening in front of us as our caboose without breaks is accelerating into the mist.
This is key: internal efficiency is only looking at what is happening inside the company, on the factory floor or conveyor belt of production of output. But it pays no attention to what happens when the output leaves the factory, goes into the world to create value. This is the most essential part of efficiency: how do we understand what produces value and what doesn’t in order to amplify what works and stop what doesn’t.
With good measurement we will be able to break down what is happening after the output leaves the factory and develop a line-of-sight from work to value giving us the opportunity to make better decisions on what and where to amplify or dampen investments.
With the right measurements we will know:
- If the right people are engaging in the right way at the right cost [quality and quantity of engagement]
- Are they getting any value from the engagement [e.g. If they came to learn something did they learn something, and did they learning the right things]?
- Is this learning leading towards the desired behavioral change [are we offering the right influences]?
- Is the behavioral change bringing value back to the customer and the business [Is the strategy making the right assumptions]?
If we can measure these we can check and improve the efficiency of :
- Our engagements
- Our value proposition
- Our strategy
- Our ability to produce impact and revenue
Our team will have a line of sight knowing where and what to improve or dampen. They will see that their job is not only to produce outputs and engagement, but to create value to the people we work for (our customers), which will make their work more meaningful and motivating (an added bonus).
I’ve been working with clients and own customers for years and have always scratched my head and asked: why are we making all these useless processes more efficient when we can remove them entirely? Knowing that this is not a difficult undertaking if we use the customer and focus on valuable outcomes.
It’s only difficult to know how and where to be efficient if we can’t see it (because we have the wrong insights), we are not prioritizing (because nobody is held accountable to the strategy) and we aren’t measuring what’s happening and having the line of sight from work (factory floor) to value.
The term Disruptive Efficiency is needed because now more than ever efficiency itself has become too inefficient and needs a disruptive overhaul to deliver the desired gains.
