Increase productivity: It starts with organizational alignment

Increase Productivity

Ways to increase productivity should be at the forefront of managerial and executive minds at any workplace — or so you’d hope. After all, at base level productivity is the amount of value produced (a good thing) divided by the time or cost it took to do so. It’s hard to achieve solid annual growth without methods in place to increase productivity, you’d reckon.

There are any number of tremendously fraught things about the quest to increase productivity, most notably the fact that many people think “busy” and “productive” are the same thing. (Breaking news: they’re not, and never have been.) We have entire sections of bookstores and millions in jet fuel burned annually in an effort to get companies to increase productivity — we talk about “The Four-Way Win” and “Productivity Styles” and we think these things will help us increase productivity. In reality, they probably don’t.

The reason they don’t is that any effort to increase productivity is misguided unless it begins from an understanding of organizational structure, organizational alignment, and job role.

Increase productivity: Some research from a billion-dollar tech firm

Ryan Fuller founded a company called VoloMetrix. Said company got acquired by Microsoft in 2015 and it looks like Fuller is working for Microsoft itself now (“acqui-hiring”) doing organizational analytics. Seems pretty noble.

He wrote a great article at Harvard Business Review entitled “The Paradox of Workplace Productivity.” What is that paradox? I’ll let him explain:

We recently worked with a multi-billion dollar technology firm, where the majority of the company’s revenue comes through a large ecosystem of partners (e.g., resellers, manufacturers, etc.). They have enjoyed strong growth for many years, but recently made the decision to put more emphasis on growing profitably rather than just growing. One of the things that they wanted to understand was the cost of managing their partner ecosystem – they had a hypothesis that there might be ways to do so more efficiently.

OK. So we got a tech company with strong growth. Check. They make money off a partner ecosystem and they want to essentially make more money off it, so they need to make sure it’s working effectively. Got it. The good news for this company: they appear to be solving the right problems.

Here’s the next step:

They began by providing us a list of around 700 employees that they believed represented the population of partner-facing roles across their organization. They asked us to confirm that these employees were indeed partner-facing, and to let them know if they missed anyone.

OK, OK … so 700 employees are the partner-facing crew. 700 employees are the primary revenue-drivers, you’d guess.

Now here’s where it begins to get interesting:

It turns out they were a bit off on the employee population involved. In reality, around 7,000 employees directly interacted with partners for at least one hour per week over the course of a year. Roughly 2,000,000 hours of time were spent in these direct partner interactions (emails, meetings). This equates to approximately $200M of employee time per year, which doesn’t even include any of the internal discussions or preparations.

Alright. We’re off the rails now. Somehow this company thought 700 people represented the partner-facing ecosystem — and it was 7,000! They were only off by, oh, about 6,300 people. And this is a company that makes billions of dollars! And grows! And they literally have no idea who’s doing what, it would appear.

And then this:

To be sure, some correlations with partner value creation emerged, but only when we got quite specific about the type of partner and the type of communication. After much iteration, the general conclusion was that at least 50% of the total time employees spent engaging with these partners had no correlation with enterprise value. That’s one million hours annually (not including internal prep time), or the equivalent of 500 full-time workers. Every day, they were dedicated to activities that appeared to be at best redundant or potentially even value destroying, with multiple employees from multiple teams engaging with the same people at the same partners in an uncoordinated way.

50 percent of the time these employees engaged with partners — so 1 in every 2 actions — had no correlation with enterprise value. Now look, there’s fundamental logistical and task stuff you need to do in every job. Not every action is value-driving, and that’s true. But 1 in every 2 actions of these 7,000 people aren’t correlated to enterprise value? That’s pretty insane. Then go down to “at best redundant or potentially even value-destroying.” And remember: this company makes money! Billions! And they grow!

Increase productivity: Begin with self-awareness

Self-awareness is one of those things you can’t toss on a balance sheet and breathlessly analyze, so a lot of execs kind of ignore it as a business concept. In reality, self-awareness is incredibly important — it’s often tied to why teams don’t hit targets or get tasks done. This floats up to the organizational level too. It’s why it’s hard to increase productivity.

Here’s what I mean. I’ve told this story before, so if you’ve heard it, bear with me. I moved down to Texas in July 2014 for a job. In June 2014, I flew down here to meet with my eventual boss and her boss. I had lunch with them. At the lunch, I asked something about the day-to-day responsibilities of the job. Neither could answer. This was a huge red flag, but at the time I needed a job, I needed money, etc, etc. I ended up taking it. 17 months later, I got fired.


Now here’s the deal: I got fired for a very specific set of reasons tied to things I did wrong, sure. But … the whole arc of the 17 months was very closely correlated with that lunch, and two people I directly reported through having absolutely no idea what I did. As a result, over the past couple of years I’ve become very passionate about job role and job definition. It’s crucially important, but we often half-ass it. We assign headcount based on politics. We create roles because it seems like competitors have someone in that role, or we heard at a conference that we need it. We don’t think about what the role would actually do, or if value would lie within it.

As Fuller writes:

To really improve productivity — and to be honest about what it means — you first have to gain a level of organizational self-awareness to understand what work actually drives value at your company, and then direct employees towards these tasks.

The other thing that becomes tremendously fraught here is that most executives tend to care about and focus on the revenue-facing roles in an organization, but oftentimes that’s only 1-2 out of every 5-8 people. (HR and other departments don’t face revenue at all, typically speaking.) If the senior decision-makers are pretty much only focused on the revenue roles, but the revenue roles are only about 20-25% of the company at most, then who’s shepherding the flock of the other 70-80% of people who come in every day and hit tasks?

There’s legit research from MIT that most organizations have no idea what their priorities are. Combine a lack of self-awareness with an over-focus on revenue roles with no true concept of how to increase productivity and … should we be surprised?

Increase productivity: Organizational structure

There is no way for everyone in your organization to be revenue-facing, no. But you need to focus a bit on organizational structure and moving the pieces around like a chessboard. Who goes where? Who fits best? Unfortunately, very few people with true decision-making power tend to think about this stuff.

The good news is that, via Deloitte, it appears more executives are starting to think about organizational structure and how teams are organized. If that’s true and not just survey lip service, it would go a long way towards efforts to increase productivity. If your organization is cohesive and aligned and the roles make sense and the people fit together in semi-logical ways, you have a better shot to increase productivity. If everyone is running around doing disorganized things to please the head of their silo, you have no chance to increase productivity. That seems logical, right?

Increase productivity: Individual vs. company alignment

This is a big one, so smartly I saved it for the end of this post. (I’m a flippin’ genius.) Phrased simply, individuals want one thing from work. Organizations want another. We can claim they’re aligned — but usually they’re not.

Individual productivity is often driven by tasks and to-do list items, i.e. a focus on the quantity of work. This pleases your boss, makes you feel busy (and thus productive, for many people), makes you feel relevant, etc. “I hit those goals! I checked those boxes!” Etc, etc.

Organizational productivity is often driven by making more money and keeping costs low as you do so, all the while assuming your goal is to make money — when in reality making money is the outcome that happens when other goals are met.

Execs tend to shepherd organizational goals.

So you’ve often got an individual worker thinking that “increase productivity” means “get more tasks done.”

Then you’ve got a C-Suiter thinking that “increase productivity” means “hit financial metric targets while keeping costs down.”

Those two thoughts about what “increase productivity” means are not aligned whatsoever.

The lack of alignment causes the majority of problems in most offices, honestly.

If we got a little bit closer on aligning them, you think we could actually increase productivity for both sides?


Other thoughts?

Ted Bauer

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