Business Maths

I was never particularly good at maths when I was at school and that inadequacy with figures has, I’m afraid, carried over into my adult life. The chances are, many of you could or would say the same. It’s socially easy to admit to difficulties with maths whereas it’s very difficult to admit to difficulties with reading. Perhaps that’s what explains some of the very questionable business maths that I heard from a group the other day.

Let’s begin by setting you a simple problem. You have a team of eight people, all of whom produce one widget per day. If you take away four people, how many widgets per day will the remaining four have to produce in order to maintain your total output of eight? The answer is, of course, two per day: even I could work that out.

However, there’s a problem. The current eight people don’t appear to be slacking. They all appear to be busy each day; they’re not sitting around drinking coffee and gossiping. One widget per day appears to be about right; in fact given that you used to have a team of 16 people producing eight widgets per day, the current productivity seems very good. So what do you do?

The answer to that, of course, is equally simple: you make the cuts anyway and drive the remaining four to work even harder, until they burn out or leave. It seems crazy – no, wait; it is crazy – but that’s exactly what the company was proposing to do. The group I was working with were resigned to taking on a whole lot of extra work on top of their existing responsibilities. When I asked them how they proposed to do that, someone muttered something about “discretionary time” but, in order to be discretionary, you have to have some choice in whether you give that time. They felt they didn’t; they had to work the extra hours, just to keep up with the job.

Oh, I understand that there are efficiency savings to be made. I understand that there might be synergies (and, unlike a lot of people who bandy that word about, I know what it means) but there is a bottom line. This bottom line isn’t on the accounts: it’s the baseline below which no-one can go. Everything you do takes time; there is nothing you do that you can do in an instant. You can be more efficient and look for ways of, perhaps, doing two things at once to speed things up, but there is a bottom line below which we cannot go. There is a point at which there are no more efficiencies; there are no more synergies. What then? Work harder is no longer the right answer...