Is Efficiency Strategic?
Ever since I wrote the series on “Is Your CX Strategic?” (Parts 1, 2, 3, 4), I find myself thinking a good bit on the distinction between operational effectiveness and strategy. And when I think about strategy, especially at work, I find myself going, “I’m doing strategy now—wheeee!” Join me. It’s fun.
A question I keep coming back to is whether efficiency—operational effectiveness—can be strategic in and of itself. I suspect that yes, it absolutely can. To illustrate the point, sports!
Photo by NeONBRAND on Unsplash
Trust the Process
In youth sports, a good coach isn’t going to focus on winning. They’re going to focus on process—the discipline of learning to perform the basic fundamentals of the game over and over and over—that will eventually lead to the outcome of winning together as a team. That’s why you practice running the bases, playing catch, hitting off the tee, etc. When you do those things well, you start to win baseball games.
There’s of course a bit of strategy as well, like how you put the best kids at the top of your batting order, but for most youth sports teams, you can invest 98% of your energy into learning to practice well and you will give yourself the best possible chance of winning the game. Operating effectively is the strategy.
Trust the Process, Reprise
Professional sports are not the same as youth sports. The rules of the game being played on the field aren’t the only factors that determine how the game is won. As made famous in Moneyball, teams can have wildly different talent pools based on how much owners are willing to pay. You can’t compete against a team with better (more highly paid) players just by trying to out-practice them. I mean, you can try, but assuming they’re practicing just as hard, your probability of outperforming them is quite low. The deck is stacked against you.
But you can think differently about you build your deck. If you value certain player statistics differently than other teams, and those statistics are better predictors of what it takes to win, you can fundamentally change the odds of winning in your favor. This is entirely a strategic move. It has almost nothing to do with what happens on the field and how well the team practices and perfects the fundamentals of the game—which, at the professional level, should be nearly maxed out—and everything to do with how the general manager puts the team together.
What’s funny to me is that after a certain point, these kinds of strategic moves eventually just become part of a process that requires discipline and operational effectiveness to execute. There’s the story of the Philadelphia 76ers basketball team and how their GM basically tried to put together a bad team that would lose, knowing that the way draft rules were structured, they would get a 1st round draft pick and be able to draft an all star franchise player, increasing their odds of winning in future seasons. Lose now, win later. Their GM became famous for encouraging fans to “trust the process"—almost as if it was a discipline to be followed just like learning the fundamentals of the game—and their franchise player, Joel Embiid, was even nicknamed "The Process” (get it?). There’s a Reply All Podcast about it and it’s hilarious and great. In certain situations, off-court strategy can be just as important as execution during the game.
Effectiveness in Business
So what’s the verdict when it comes to business? Can operational effectiveness be strategic in and of itself? Yes, absolutely, with the caveat that you occasionally need to stop and re-evaluate if you’re focused on the right thing.
I can’t help but think of Chick-fil-a (which I explored indirectly in a previous newsletter). They’re so incredibly efficient. If you’ve ever used their mobile app or been through their drive through at noon on a Friday afternoon, you’ve experience the heights of their efficiency first hand. Whereas other fast food restaurants can barely keep up with the lunch hour rush, Chick-fil-a has turned operating well into a differentiator. Customers will choose them not just for their product but because of how well they operate. When customers are choosing you because of how well you operate, that signifies that customer experience has become part of the product and is strategically aligned to drive loyalty and repeat business.
Let’s pause here and emphasize that last bit. Yes, customer experience is a fundamental driver of revenue and expansion.
So yes, operational effectiveness can lead to customer loyalty, but the effects are actually compounding. One of the main outputs of operational effectiveness is that it creates time, practically from nothing. One moment, it takes your team 8 hours to accomplish a set of important tasks and the next moment it takes 5 minutes. What do you do with the extra 7 hours and 55 minutes? Do you fire the team? Or do you align strategically around constantly making operational improvements such that you can re-invest the team into a new process and set of improvements. Each investment in operational effectiveness creates time that can be invested into new processes in the future, and so on.
The only real caveat here is that you occasionally have to step back and make sure your focus is in the right place. I’ve written about this before:
[Our teams have] many systems in place that keep us highly focused on solving complex customer problems in an efficient manner…. Systems will always have flaws, which is why it’s so important to consistently take a step back to re-focus on what matters.
You have to take a step back from time and see if the game has changed. Is the market starting to offer live chat? Are customers starts to prefer purchasing via self-service? Should we be offering onboarding? Maybe we should keep our self-service help center up to date (yes, absolutely, why haven’t you done that yet?). These are the kinds of questions you need to ask from time to time to make sure you’re focused on what customers care about. But even as you ponder strategic questions, there’s an ongoing opportunity to think strategically about how you intend to operate well. Investments in operational effectiveness create opportunities for additional ways to invest that newly discovered time. Just make sure to reserve some of that time for thinking about how you can better focus on the customer.