The fallacy of efficiency

        Dan North
      ThoughtWorks
Dear Michael...
“So here's the thing, I don't believe in efficiency.
  It's our obsession with efficiency that has got
  u...
Efficiency (n)
1. The state or quality of being efficient;
   competency in performance.

2. Accomplishment of or ability ...
How do we measure efficiency?
           Budget/revenue targets

                Effort targets

                Time targ...
A brief history of efficiency
Pre-industrial
Industrial revolution
Rise of capitalism in America
Frederick Winslow Taylor
...
Meet Mr. Taylor
“It is only through enforced standardization of
   methods, enforced adoption of the best
   implements an...
Effectiveness (n)
1. Adequate to accomplish a purpose;
   producing the intended or expected result.

2. Actually in opera...
A brief history of effectiveness
Blah blah capitalism in America
W. Edwards Deming
Lean
  begat TQM and some other monster...
Meet Mr. Deming
“All anyone asks for is a chance to work with
  pride.”

“A bad system will beat a good person every
  tim...
Systems Thinking – “thinking in circles”
Factors influence one another in loops
   balancing or reinforcing, feeding back ...
You get what you measure



“Everyone is trying to help” – Virginia Satir




                © Dan North, ThoughtWorks   ...
Let’s game!
Exam pass rates in schools?

 Test pass rates in builds?

    Prison inspections?

      Test coverage?

     ...
How can we measure effectiveness?
Understand you are working with a system
   in fact a system of systems, of systems, of ...
How can we measure effectiveness?
Throughput accounting
  investment, operating cost, profit


Cycle time for end-to-end c...
Effectiveness is often inefficient
Cross-functional teams
Pair programming
Promiscuous pairing
Parallel spikes
Experimenta...
But it gets worse...
What influences your organisation?

                   Competitors
                     Markets
     ...
Change happens
               x                     x’
Performance




              Choice
                              ...
If you focus on efficiency...
You get better at being increasingly less effective

                  until one day

      ...
Ouch!


“Those who cannot remember the past are
  condemned to repeat it”

                                             Ge...
Some vendors feed off this
Product vendors
  have tools that hog the spotlight
  want you to buy bloatware

Services vendo...
Some would rather help you
Product vendors
  tools that keep out of your way... and your wallet


Services vendors
  want ...
If you remember one three things...
You get what you measure

Not all the vendors are bad guys
  Figure out whether they a...
Thank you


      Any questions?



dan.north@thoughtworks.com
     http://dannorth.net

        © Dan North, ThoughtWorks...
Bibliography

The Art of Systems Thinking – Joseph O’Connor

      The Modern Firm – John Roberts




                 © D...
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The Fallacy Of Efficiency

  1. 1. The fallacy of efficiency Dan North ThoughtWorks
  2. 2. Dear Michael... “So here's the thing, I don't believe in efficiency. It's our obsession with efficiency that has got us into the current technology mess, and which has led almost directly to heavy waterfall processes. “Efficiency is how you let the big vendors sell their bloated technologies to the poor CIOs.” © Dan North, ThoughtWorks 2
  3. 3. Efficiency (n) 1. The state or quality of being efficient; competency in performance. 2. Accomplishment of or ability to accomplish a job with a minimum expenditure of time and effort. 3. The ratio of the work done or energy development by a machine, engine, etc., to the energy supplied to it, usually expressed as a percentage. © Dan North, ThoughtWorks 3
  4. 4. How do we measure efficiency? Budget/revenue targets Effort targets Time targets Activity targets What does % complete on a Gantt chart tell us? © Dan North, ThoughtWorks 4
  5. 5. A brief history of efficiency Pre-industrial Industrial revolution Rise of capitalism in America Frederick Winslow Taylor Management Science ...You are here... Richard Durnall – the IT Division Refactored © Dan North, ThoughtWorks 5
  6. 6. Meet Mr. Taylor “It is only through enforced standardization of methods, enforced adoption of the best implements and working conditions and enforced cooperation that this faster work can be assured. “And the duty of enforcing the adoption of standards and enforcing this cooperation rests with management alone.” Frederick Winslow Taylor © Dan North, ThoughtWorks 6
  7. 7. Effectiveness (n) 1. Adequate to accomplish a purpose; producing the intended or expected result. 2. Actually in operation or in force; functioning. 3. Producing a deep or vivid impression; striking. © Dan North, ThoughtWorks 7
  8. 8. A brief history of effectiveness Blah blah capitalism in America W. Edwards Deming Lean begat TQM and some other monsters Systems Thinking ...You are here... © Dan North, ThoughtWorks 8
  9. 9. Meet Mr. Deming “All anyone asks for is a chance to work with pride.” “A bad system will beat a good person every time.” W. Edwards Deming © Dan North, ThoughtWorks 9
  10. 10. Systems Thinking – “thinking in circles” Factors influence one another in loops balancing or reinforcing, feeding back or forwards The shower being too hot Being addicted or too cold to drugs Committing crime to pay for drugs The amount I move the dial Being in prison with easy access to drugs © Dan North, ThoughtWorks 10
  11. 11. You get what you measure “Everyone is trying to help” – Virginia Satir © Dan North, ThoughtWorks 11
  12. 12. Let’s game! Exam pass rates in schools? Test pass rates in builds? Prison inspections? Test coverage? © Dan North, ThoughtWorks 12
  13. 13. How can we measure effectiveness? Understand you are working with a system in fact a system of systems, of systems, of turtles Identify the goal of the system which is sometimes just its own survival Step outside the system to observe its effect How well does its goal align with yours? © Dan North, ThoughtWorks 13
  14. 14. How can we measure effectiveness? Throughput accounting investment, operating cost, profit Cycle time for end-to-end customer journey “From concept to cash” Cost of end-to-end process including opportunity costs, factoring in time © Dan North, ThoughtWorks 14
  15. 15. Effectiveness is often inefficient Cross-functional teams Pair programming Promiscuous pairing Parallel spikes Experimentation (aka Innovation) Theory of Constraints Efficiency is the enemy of effectiveness! © Dan North, ThoughtWorks 15
  16. 16. But it gets worse... What influences your organisation? Competitors Markets Technology Staff Customers These are all changing outside your control! © Dan North, ThoughtWorks 16
  17. 17. Change happens x x’ Performance Choice John Roberts – the Modern Firm © Dan North, ThoughtWorks 17
  18. 18. If you focus on efficiency... You get better at being increasingly less effective until one day you notice about 2 years down the line so you have your next corporate overhaul © Dan North, ThoughtWorks 18
  19. 19. Ouch! “Those who cannot remember the past are condemned to repeat it” George Santayana © Dan North, ThoughtWorks 19
  20. 20. Some vendors feed off this Product vendors have tools that hog the spotlight want you to buy bloatware Services vendors want you to outsource, ideally off shore Process vendors want you to buy their rigid methodology © Dan North, ThoughtWorks 20
  21. 21. Some would rather help you Product vendors tools that keep out of your way... and your wallet Services vendors want to co-source, and Share Knowledge™ Process vendors want to sell you self-sufficiency and adaptability © Dan North, ThoughtWorks 21
  22. 22. If you remember one three things... You get what you measure Not all the vendors are bad guys Figure out whether they are helping or hindering Efficiency isn’t effective © Dan North, ThoughtWorks 22
  23. 23. Thank you Any questions? dan.north@thoughtworks.com http://dannorth.net © Dan North, ThoughtWorks 23
  24. 24. Bibliography The Art of Systems Thinking – Joseph O’Connor The Modern Firm – John Roberts © Dan North, ThoughtWorks 24
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