Ever had a challenge evaluating intangibles? I love the term “bean counters” It is so illustrative. Someone able to count beans, but having no breadth of understanding of the value of intangibles.
A short story is probably inappropriate. Once for a short period I worked for a large state agency as a contractor. I watched as a money saving project moved forward to take personal printers out of staff offices and replace them with networked printers.
The savings appeared substantial on the macro level but at the office level, staff members would have to get up from their desks, secure their offices and go find the paperwork at the networked printer. Now cover that human power cost with a percentage of a penny per copy. You might conclude too, that someone had trouble evaluating intangibles, but were ace bean counters to a portion of a penny.
All right, lets get back on point here. On measuring intangibles, back in the good old days you could measure personal productivity by the widgets produced, the bricks laid, the number of screws inserted–. but not so much anymore.
Intellectual work is just plain hard to evaluate… the best managers do this well, others do OK, the rest just make matters worse.
Now lets think about evaluating the processes which impact the intellectual work. Oh, oh, this sounds really hard too.
Say something like getting estimates completed quickly but effectively. How many people are involved in the process? How much redundancy and reentry of data wastes time and slows down the process? How much is the process impeded by lack of proximity to tools and documents that are inaccessible from convenient locals.
What other little toe stubbers slow down and impact human creativity and problem solving? What is the ultimate impact when estimates are slowed down?
Well, prospects turn cool with the delay. Estimates just plain don’t get done. There is this big constraint on getting sales closed– what did Peter Drucker say was the only purpose of business? I forget– but intangibles can be at the very core of skinny profits.
So why the big fuss about intangibles? Battling with ineffective work processes is a strategic strategic issue. Intangible are at the core of a problem with proximity and the high perceived impact of tangible acts. I just made that up. But I like the phraseology. Let me explain.
It is much easier to feel the impact of writing a check– ouch! than a hunch about what the service might save in costs. The “punch in the gut” feeling of dealing with change and the sense of risk involved in something new has a higher leveraged impact than the obscurity of intangible gains.
Change in hard. Change affects productivity. People have to learn new work habits. People don’t like change, although I know for a fact, that engaged leadership can create an understanding and fashion the positioning necessary to make change exciting, fun and an exercise where everyone is a stakeholder in success.
It is SO EASY to just NOT DO, when DOING will save money and energy into perpetuity.
So how do we reduce the power of the immediate tangible over the significant but intangible?
Time must be taken to make a balanced evaluation. This is not a time to procrastinate. Saving money has to be taken seriously. Improving human productivity and eliminating busywork is essential. And it doesn’t take rocket science to blow up a bad idea. You just need a balanced evaluation process.
We need to create a cost analysis array where we can attribute estimated costs and time frames into a spreadsheet. We must be able to put a weighting factor into the calculations where priority interests can add impact.
When all is said and done, the numbers can be run and the ROI outlined. This makes decision making much easier and rational and makes everybody feel better. It is a win all around.
Such a procedure can help ameliorate check writing phobias and nervous twitches related to fear of risk and fear of change.
Lets go way out on a limb here.
Right now you are losing countless piles of money perpetuating time wasting operational tasks that if innovation was implemented –
- could make personnel happier: they are doing less busy work
- better engage team members because their efforts have more positive impact
- improves accessibility of tools and documents to staff members where they are
- give your team tools to creatively solve problems and better distribute their work load
- everyone can take better care of customers more effectively.
Calculating the value of intangibles is tough but close works OK. Bottom line, smart business owners do the most even handed job they can evaluating worthwhile innovation and really smart business owners trust their people doing the work to help make such decisions.
Feel free to toss in your own thoughts here.
