Hi mindmeld - the "productivity myth".
I've seen a lot of these "productivity" initiatives by IT organizations. Actually did a fair amount of that chart-jockeying for budget slice myself. Quite successfully.
The one that always works is the argument that if you spend X$ here you can reduce Y$ over there, where X is smaller than Y by at least whatever hurdle rate is in vogue at the time. Or the "if you don't spend" converse when the budgetary pocket you are planning to pick is tight.
It works brilliantly if "here" and "there" are the same place, only separated in time across fiscal years... lol.. organizations have flawed memories. Now you see it, now you don't. Even more brilliant if you can move on and get promoted just as the "savings" start to kick in, but before the full effect can be counted. Look, nothing up my sleeves... hold my coat please?
The final act is in the creative repositioning of "old" costs versus "new" costs and show how your past productivity effort has obliterated all of these "old" costs, allowing the company to spend even more "new" costs. One side of one balance sheet shown here, the other side of another shown there. Never reconciled. David Copperfield of creative accounting. All but very few senior executives can detect the subtle flaw in this seductive logic.
Because it's all a shell game. Chasing the pea in the pod.
You don't have to believe me. You can measure it directly. Productivity is "Output" divided by "Input".
Look at the mighty Cisco. The most internet savvy of the bunch. If anyone should be the asymptote of productivity gains through interneting the business it should be Cisco.
Oh, how strange, actual "Output" over "Input" (Gross Margin) has steadily declined!!! All those unharvested productivity initiatives happening under the guise of "OPEX" are growing the business yes. But so far they have not increased productivity one smidgen. And you will be hard pressed to go back and find ANY budget submission that claimed negative productivity as an anticipated outcome. So the sum of the parts is indeed greater than the whole.
Are you sure that pea is under there?
Take it farther. If the greatest internet enabled to the max company on the planet is getting negative productivity growth, what's happening at those that are only mediocre?
Possibly getting bitten by the sharp teeth of reality right about now.
No shame in proclaiming the productivity myth. After all, you're one of those IT professionals whose job depends on it being perceived as true. You and me both. So it is a good thing that you pound the table about its benefits.
But... while pounding on the table to preserve your ability to sacrifice Dollar Cost Averaged funds to the money gods of the market, you might want to hedge your bets. That is, invest in companies that create something other than IT "productivity".
John. |
