Management Articles


 

The Law of Improvement Displacement

By: Jim Clemmer

Jim Clemmer is an international keynote speaker, workshop leader, author, and president of The CLEMMER Group, a North American network of organization, team, and personal improvement consultants based in Kitchener, Ontario, Canada. His other bestsellers include Firing on All Cylinders: The Service/Quality System for High-Powered Corporate Performance, and his most recent book, Growing the Distance: Timeless Principles for Personal, Career, and Family Success. His web site is http://www.clemmer.net/


"What you are going to be tomorrow you are becoming today."
In a dingy, unused warehouse down by the waterfront, a real estate agent found a curious old machine covered in cobwebs, grime, and decades of dust. As he was wiping the dust away and inspecting the old contraption, he found a few pieces of yellowed paper in a cracked leather pouch. He chuckled softly to himself when he pulled them out and found they were entitled "Operating Instructions for The Perpetual Money Machine."

"What's the harm in following them?" he thought, as he turned rusty dials and pulled creaky old levers according to the directions. Suddenly the machine whirred, clanked, and clamored to life. It coughed and wheezed a few times, a bell rang, and out dropped a bundle of crisp new $20 bills with a red elastic around them. The agent was stunned. As he was inspecting the stack of bills, the bell rang again and another bundle dropped out. Then it happened again. And again. By nightfall, the agent estimated he had about $50,000. In the gathering darkness, he found the instructions to shut the machine off and went home.

Within days the agent had bought and secured the warehouse. He now spent every day operating the incredible money machine. He carefully followed all the instructions. But the "Care and Maintenance" section was becoming especially irksome. It clearly spelled out that the machine could operate no more than ten hours per day. It must have an hour of greasing and oiling each day. And the machine needed at least one day of complete rest per week.

Within a few weeks, the agent began to find that this care and maintenance schedule was a big bother. The down time was costing him a lot of money. So he started trimming back on maintenance. The machine kept producing money. Encouraged, he operated it for eleven, then twelve hours a day and continued to reduce maintenance time. Those magical twenty-dollar bundles started to slow down, but they still kept coming. Soon he was operating it seven days a week for eighteen hours a day.

But than the stream of bundles slowed to a trickle. Frantically, the agent went back to the maintenance schedule. But it was too late. The bundles of twenty-dollar bills all but stopped. One day, the agent became frustrated with waiting for the next bundle of bills to finally drop. He picked up a big wrench that he once used for maintenance and angrily smashed the side of the machine. With a loud, long hiss, the machine gradually shrank, shriveled, and faded into a mound of rusty iron filings on the black, greasy floor.

I wrote this fable to illustrate a very old performance principle. I call it The Law of Improvement Displacement — short-term performance pressures drive out long term improvement activities. The growth, development, and performance of many organizations, teams, and people is severely stunted by their failure to recognize and overcome this natural law. Too many managers fail to balance cash flow and wealth. They allow today's cash flow needs to crowd out tomorrow's wealth producing activities. These shortsighted managers forget that today's cash is the result of yesterday's wealth investments (some of which go back decades).

Few managers would ever allow physical assets like buildings, technology, production equipment, or vehicles to crash or burnout from lack of care and maintenance. Repair schedules are followed, insurance coverage is purchased, computer and telecommunication systems are regularly backed up, upgraded, and tested, parts are greased, and oil is changed. Yet many managers fail to make the same investments in themselves, their teams, and their organization. They're so busy trying to produce today's cash that they neglect to build tomorrow's wealth. So when tomorrow finally comes, there's little wealth to produce cash.

In today's information age, an individual, team, or organization's wealth is its capabilities. That's the source of tomorrow's cash. An organization's future revenues, for example, will come from finding and exploiting new markets, customers, and unmet needs better and faster than anybody else.

Customer loyalty (and continuing revenues) will be earned by closing product or service performance gaps better than anybody else. Those "Prime Directives" depend on capable internal and external partners: creative partners that know how to innovate and have the hard management systems and soft leadership cultural support to do so; passionate partners that are enthused and energized about being part of a winning team with an exciting future, rock solid principles, and soul stirring purpose; caring partners that provide the same high levels of service they're getting from their servant-leaders.

These are capability issues. They determine the organization's future wealth from which future cash will flow or trickle. If we want to expand tomorrow's wealth, expand today's capabilities.

© Copyright 2001 The CLEMMER Group

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