2
Liberate the Organization’s Time
As we noted earlier, most companies have elaborate procedures for managing financial capital: business cases, hurdle rates, spending limits, and so on. An organization’s time, by contrast, goes largely unmanaged. Although phone calls, emails, instant messages, meetings, and teleconferences eat up hours of every executive’s day, companies have few rules to govern these interactions. Most companies have no clear understanding of how their leaders and employees are spending their collective time. Not surprisingly, that time is often squandered—on long email chains, needless conference calls, and countless unproductive meetings.
This lack of management results in acute organizational drag. Time devoted to internal meetings and communications detracts from time spent providing value to customers. Organizations become bloated, bureaucratic, and slow, and their financial performance suffers. Former Intel CEO Andy Grove once wrote, “Just as you would not permit a fellow employee to steal a piece of office equipment, you shouldn’t let anyone walk away with the time of his fellow managers.”1 Of course, such thievery happens all the time, usually unintentionally. Meetings creep onto the calendar with no clear plan or priority. New initiatives crop up every day, demanding management attention. And the flood of messages never stops. According to our survey, executives work an average of over forty-seven hours a week—somewhat more in the Asia-Pacific region, slightly less in Europe, the Middle East, and Africa—but often have much less to show for all that effort than they would like.
What can be done? Most advice on managing time focuses on individual actions. The time gurus advise us to reassert control over our email, be far more selective about which meetings we attend, and so on. Such recommendations are worthwhile and helpful, but organizational drag can’t be countered by individual actions alone: even the best time-management intentions are likely to be overwhelmed by the demands and practices of the organization. The emails and IMs keep coming. So do the meeting invitations. Ignore too many and you risk alienating your coworkers or your boss. And if this steady stream of interactions is how your company gets its work done, you have little choice about the matter: you have to plunge in and try to swim your way to the other side as best you can.
Fortunately, some of the outliers have identified ways to manage organizational time quite differently. They not only simplify where the work is done—by what level, which function, which business units, and so on—as we will describe in the following chapter; they also simplify how the work is done, saving enormous amounts of time. They expect their leaders to treat time as a scarce resource and to invest it prudently. They bring as much discipline to their companies’ time budgets as they do to their capital budgets. These organizations have significantly lowered their overhead expenses. They have also liberated as much as 40 percent of unproductive time for executives and employees. That burst in productivity fuels innovation and accelerates profitable growth—and it frees employees from the frustrating, mind-deadening feeling that they are forever wasting their time.
By the numbers: how organizational time is squandered
To see how things got so bad, consider a seemingly innocent piece of technological wisdom known as Metcalfe’s Law. Robert Metcalfe—at this writing a professor at the University of Texas—is a giant in the technological field, coinventor of Ethernet technology, and cofounder of 3Com, a company later acquired by Hewlett-Packard. Along the way, he formulated a rule of thumb regarding the value of any network.
Metcalfe postulated that the value of a network increases with the square of the number of network users. One fax machine, for example, is worthless. Two fax machines are worth only a little. But a network that includes thousands of fax machines is worth millions, because now all those people can send documents to one another.
Metcalfe’s Law, however, has a dark side: as the cost of communications decreases, the number of interactions increases exponentially, as does the time required to process these interactions. Once upon a time, when executives or managers received a phone call while they were away, they received messages on pink slips of paper from their secretaries saying that someone had called. A busy exec might receive as many as twenty on an average day, or about five thousand a year. Then came single-user voicemail, followed by multiuser voicemail (the pre-email version of “Reply All”); the cost of leaving a message thus declined, and the number of messages left rose accordingly, perhaps to ten thousand a year. Then, finally, came today’s layers of networks—phone, email, IM, and so on—in which the cost of communicating with one person or many hundreds of people is virtually nil. Not surprisingly, the number of messages has burgeoned, perhaps to fifty thousand a year (see figure 2-1). Taking, responding to, and dealing with the consequences of all those messages obviously puts a burden on the individual. But it’s not only the people directly concerned whose time is consumed. Other employees must also get involved. The more senior an executive, the more time others will have to spend filtering, organizing, and coping with those fifty thousand messages and conversations.
FIGURE 2-1
The dark side of Metcalfe’s Law
Source: Bain & Company
Today, companies have time-tracking tools that weren’t available in the past. With the widespread use of Microsoft Outlook, Google Calendar, Apple Calendar, and other enterprisewide calendar and messaging applications, companies can track where managers and employees are spending the organization’s collective time and, thus, investing this scarce resource. The calendar data shows how many meetings and of what type are occurring each week, month, or year. It shows how many people are attending these sessions, by level and function within the organization. It even permits organizations to track certain organizational behaviors, such as parallel processing and double-booking, that occur before, during, and after meetings. Of course, a company scrutinizing all this data needs strong safeguards to protect employee privacy; nobody wants the feeling that Big Brother is watching his every move. But the information can paint a vivid and revealing picture of an organization’s time budget.2
To study the use of time, we and our colleagues at Bain employed innovative people analytics tools from a Seattle-based company called VoloMetrix, which, in late 2015, became a subsidiary of Microsoft. Here’s what we discovered from examining the time budgets of seventeen large corporations:
Companies are awash in e-communications. As the incremental cost of one-to-one and one-to-many communications has declined, the number of interactions has radically multiplied. Some executives now receive some two hundred emails a day, or about fifty thousand messages a year in email alone. The increasing use of IM and crowdsourcing applications promises to compound the problem. If the trend is left unchecked, executives will soon be spending more than one day of every week just managing electronic communications.
Meeting time has skyrocketed. People are also attending more meetings. There are two primary reasons. First, the cost of organizing meetings has dropped dramatically. Think about the effort that used to be involved in scheduling a meeting with five executives twenty-five years ago. To find a time, one executive’s secretary had to propose a time to each of the other executives’ assistants. After a series of back-and-forth communications, a date, time, and location were finally agreed on. It took a lot of effort, so executives requested far fewer meetings. Second, the number of meetings has increased because it’s far easier than in the past for attendees to take part via telephone, videoconferencing, screen sharing, and the like. This has further reduced the cost associated with holding a meeting.
The result is indisputable: on average, senior executives devote more than two days every week to meetings involving three or more coworkers. Overall, about 15 percent of an organization’s collective time is spent in meetings—a percentage that has increased every year since 2008.
These gatherings don’t just proliferate; they cascade. A single meeting at the top can produce ripple effects throughout the organization that consume significant time and money. At one large industrial company we worked with recently, the senior leadership team held weekly meetings to review performance across the business. Those meetings directly consumed seven thousand hours a year of organizational time. In addition, each member of the leadership team met with his or her unit to prepare for the weekly meetings, consuming an additional twenty thousand hours a year. Each unit, in turn, looked to its teams to generate and cross-check critical information, mostly in meetings. These second-order effects ate up another sixty-three thousand hours a year. Finally, email and data collection extended far beyond the people involved in preparatory meetings. All told, those senior leadership meetings accounted for more than three hundred thousand hours a year (see figure 2-2).3
Ripple effects of a single leadership meeting
Source: Michael C. Mankins, Chris Brahm, and Greg Caimi, “Your Scarcest Resource,” Harvard Business Review, May 2014.
Real collaboration is limited. Although the number of one-to-one and one-to-many interactions has risen dramatically over the past two decades, up to 80 percent of the interactions we reviewed took place within departments, not between businesses, across functions, or between headquarters and other parts of the company. As for the interactions that did extend beyond an individual unit, analysis of their content suggests that many of them involved the wrong people or took place for the wrong reason—that is, they were primarily for information only, rather than to gather input or brainstorm alternatives. In short, more time spent interacting has not produced significantly more collaboration outside organizational silos.
Dysfunctional meeting behavior is on the rise. Meeting participants at most of the organizations we examined routinely sent emails during meetings. In 22 percent of one company’s meetings, participants sent three or more emails, on average, for every thirty minutes of meeting time. (Numerous other studies have documented extensive web surfing and other distractions during teleconferences, an increasingly common way of conducting meetings. Such distractions have been shown to cause a ten-point fall in a person’s IQ—the same as losing a night of sleep, or twice the effect of smoking marijuana.) At the same company, executives commonly double-booked meetings and decided later which one they would attend. So meeting organizers could never be sure whether required attendees would actually show up.
Dysfunctional behaviors like these create a vicious circle: parallel processing and double-booking limit the effectiveness of meeting time, so the organization sets up more meetings to get the work done. Those meetings prompt more dysfunctional behavior, and on and on.
Formal controls are rare. At most companies, no real costs are associated with requesting coworkers’ time. If you want a meeting, your assistant merely sends out a meeting request or finds and fills an opening in the team’s calendar. If you identify a problem in need of fixing, you convene a task force to study it and, most likely, launch an initiative to address it. Such demands on the organization’s time typically undergo no review and require no formal approval. For example, leaders at one large manufacturing company recently discovered that a regularly scheduled ninety-minute meeting of midlevel managers cost more than $15 million annually. When asked “Who is responsible for approving this meeting?” the managers were at a loss. “No one,” they replied. “Tom’s assistant just schedules it and the team attends.” In effect, a junior vice president’s administrative assistant was permitted to invest $15 million without supervisor approval. No such thing would ever happen with the company’s financial capital.
There are few consequences. In a recent Bain survey, senior executives rated more than half the meetings they attended as “ineffective” or “very ineffective.” Yet few organizations have established mechanisms for assessing the productivity of individual gatherings, not to mention clear penalties for unproductive sessions or rewards for particularly valuable ones.
Think about the effect of all this on the typical entry-level manager’s week. She spends roughly twenty-one hours in meetings, plus another eight dealing with e-communications. Some portion of this time is wasted on emails, calls, and IMs that should never have been sent or that she should never have responded to. More is wasted on meetings that should never have been held or that she should never have attended. If all the e-communications and meetings were bunched up at the beginning of the week, she wouldn’t be able to start other work until late Thursday afternoon. But, of course, they aren’t bunched up—they regularly interrupt the manager’s other work. If you were to deduct periods of less than twenty minutes of working time from her productive time, you would find that she has something like 6.5 hours a week of uninterrupted time for tasks other than meetings and communications (see figure 2-3). Studies have shown that, while multitasking can be emotionally satisfying because you feel busy and important, your performance drops significantly.
FIGURE 2-3
Meeting overload leaves little time to think or work
Example: 40% of time can be liberated by reducing meeting frequency, reducing invitees, and/or reducing email.
Source: Bain & Company
The good news, however, is that between 25 percent and 40 percent of the typical manager’s time is potentially recoverable. The secret is to bring greater discipline to time management.
How to manage your organization’s time
Some Swedish companies are trying out a radically simple way to manage organizational time: give people less of it. “In Sweden, the six-hour workday is becoming common,” reports the magazine Fast Company. One company, an app developer called Filimundus, made the switch in 2014 with no loss of productivity. The reason? “The leadership team just asked people to stay off social media and personal distractions, and eliminated some standard weekly meetings.”4
How simple! But Sweden has long been something of an exception, and companies in other countries aren’t likely to adopt the six-hour day anytime soon. Still, there are plenty of other ways to reduce organizational drag by better managing work time. These methods fall into three broad headings.
1. Invest time as carefully as you invest money
Since no company that we know of has a chief time officer, the responsibility for setting time-investment standards falls to the CEO. And some have shouldered that responsibility in innovative ways.
Be ruthless in setting priorities. When Steve Jobs was leading Apple, he would take the company’s top one hundred executives off-site for a planning retreat, where he pushed them to identify the company’s top ten priorities for the coming year. Members of the group competed intensely to get their ideas on the short list. Then Jobs liked to take a marker and cross out the bottom seven. “We can only do three,” he would announce. His gesture made it clear what the executives should and should not focus on.5
Of course, you don’t have to be as dramatic as Jobs. When Gary Goldberg became CEO at Newmont Mining in March 2013, he found that eighty-seven initiatives were under way across the company, each demanding the time and attention of one or more members of Newmont’s executive leadership team (ELT). Many of those initiatives, including efforts to improve mine safety or increase operational efficiency, were valuable. Others were more questionable in terms of Newmont’s return on investment.
To gain control over initiative creep, Goldberg insisted that leaders develop formal business plans for all the company’s current and proposed initiatives. Before investing any time in an initiative, the ELT had to review the business case and approve the effort. Each plan had to specify the precise economic benefit the initiative would deliver and also its total cost, including the time of executive leaders. Every initiative was required to have an executive sponsor, who was accountable for managing its progress and keeping it on budget.
These requirements had the desired effect. Many of the initiatives that had been under way when Goldberg took over were discontinued because no one presented a business case for them. Others did go through a business-case review but were not approved. After less than three months, Newmont had scaled back the number of initiatives by one-third. Newmont also reduced the size of its corporate headquarters by 30 percent, pushing greater authority and accountability to leaders at its mine sites. And it refocused its collective time on improving safety and operational efficiency.
Create a fixed time budget—and reduce it wherever possible.Another great tool: establish a fixed amount of time for meetings and other distractions. Companies that do this say, in effect, “We will invest no additional organizational time in meetings; we will fund all new meetings through withdrawals from our existing meeting bank.” As with financial budgets, these companies can then find ways to cut the time budget.
That’s essentially what Alan Mulally did. When Mulally became Ford’s CEO, in 2006, he discovered that the company’s most senior executives spent a lot of time in meetings. In fact, the top thirty-five executives assembled every month for what they called “meetings week”—five days devoted to discussing auto programs and reviewing performance. The direct and indirect costs of these sessions were significant—far more than the company could afford at the time.
So in late 2006, Mulally asked his team to assess the efficiency and effectiveness of the company’s regular meetings. The team quickly eliminated all unnecessary ones and shortened those that were unduly long, which forced people to maximize output per minute of meeting time. Team members also became much more selective about requests for new meetings. Although individual managers at Ford are not required to eliminate one meeting before another can be scheduled, the company’s executives treat organizational time as fixed.
The centerpiece of Ford’s approach is a weekly session called the Business Plan Review (BPR). It brings together the company’s most senior executives in a focused four- to five-hour session to set strategy and review performance. That by itself reduced the senior team’s meeting time from about fifty hours a month to about twenty. Moreover, content for the session was standardized, reducing the extensive prep time previously required. Substituting the BPR for the “meetings week” liberated thousands of hours at Ford, enabling the company to lower overhead costs at a time when rivals were seeking a government bailout. It also improved the quality and pace of decision making at the company, accelerating Ford’s turnaround.
A company that can establish a fixed time budget could at some point choose to start each year with a clean slate. Just as many companies develop their operating and capital budgets from scratch each year, a company that was serious about time management might decide to examine every regularly scheduled meeting to determine whether it was really necessary.
Establish clear delegations of authority for time investments. Most companies place few restrictions on who can organize a meeting. Decisions regarding how long the session should be, who should attend, and even whether participants must attend in person are frequently left up to low-level employees. The result: costly meetings are scheduled without scrutiny.
At another manufacturing company we worked with recently, the leadership team took two simple steps to rein in unproductive meeting time. First, it reduced the default meeting length from sixty minutes to thirty. Second, it established a guideline limiting meetings to seven or fewer participants. Any meeting exceeding ninety minutes or including more than seven people had to be approved by the supervisor of the convener’s supervisor (two levels up). This cut the organizational time budget dramatically—by the equivalent of two hundred full-time employees over a six-month period.
Create a new protocol for e-communications. We often tell clients and audiences that we have one simple, free piece of consulting advice for liberating unproductive time: eliminate “Reply All” on the company’s system. We mean this facetiously, but there’s more than a grain of truth in it. Indiscriminate copying of messages to everyone who might possibly be interested clutters up inboxes and wastes huge amounts of time. If people had to type in every recipient’s name, they would be considerably more careful about which individuals they put on the “To” or “CC” lists. Emails and responses would undoubtedly decline, probably dramatically.
Many companies have found it useful to spell out rules and protocols for emails. At one large technology company, a time audit revealed that employees at all levels of the organization were spending nearly half a day each week reading and responding to emails that they should never have received in the first place. Senior leaders were aghast. As a first step, they decided to role-model new behaviors regarding email. They reduced the number of one-to-many emails they sent. They resisted responding to emails sent to them “for information only.” And they started to call out others who were copying them on emails that they did not need to receive. With time, the leaders’ practices caught on, and managers at other levels of the organization altered their behavior. The result: far less of the organization’s time was wasted on unnecessary e-communications.
Provide real-time feedback to manage organizational load. It’s said that we can’t manage what we don’t measure. Yet few organizations routinely track the critical variables affecting human productivity, such as meeting time, meeting attendance, and email volume. Without such monitoring, it is hard to manage those factors—or even to know the magnitude of your organization’s productivity problem. And without a baseline measure of productivity, setting targets for improvement becomes impossible.
Many executives already review how much time they spend with various constituencies and on various issues, using just their own calendars. A few companies, including Seagate and Boeing, have experimented with giving their executives real-time feedback on the “load” they are putting on the organization in terms of meetings, emails, IMs, and so forth. At Seagate, some senior managers participated in a program in which they routinely received reports quantifying their individual loads along with the average load generated by other executives at their level and in their function. This information, combined with guidelines from the top, encouraged them to modify their behavior to liberate organizational time.6
2. Run meetings that work
And then there are meetings. No company can eliminate all of them; some meetings are essential for fostering collaboration and making critical decisions. But most companies can dramatically improve the quality of the meetings they do hold by establishing a few simple norms:
- Be sure a meeting is appropriate. Meetings are great for some tasks, like gathering input and coming to a group decision. They aren’t so good for others, such as drafting a strategy document. Before calling a meeting, decide whether it’s really the best way to get the job done.
- Set a clear—and selective—agenda. A surprising number of meetings don’t have an agenda. One study found that 32 percent of meetings lacked an agenda, and only 29 percent of meetings had a written agenda that was distributed to all attendees in advance. A clear agenda communicates priorities. It also tells people what they can safely postpone or ignore.
- Reduce meeting time whenever possible. In general, people can concentrate on a single topic for an average of about eighteen minutes. Switching topics makes it possible to reengage participants, but there’s a limit of about forty-five minutes in all. In conference calls, people stop paying attention after an average of twenty-three minutes.
- Insist on advance preparation. One study reported that as many as one-third of meeting participants do not prepare for a meeting at all. At Ford, all materials for weekly BPRs must be distributed in advance so that participants can review them ahead of time. That greatly reduces the time devoted to information sharing during the BPR. At Amazon, CEO Jeff Bezos expects carefully written reports—no PowerPoint presentations—at every meeting of top executives. Then he gives attendees thirty minutes at the start of the meeting to read these reports.
- Practice good meeting hygiene. Clarify the purpose of every meeting. Spell out people’s roles in decisions. Create a decision log that captures every decision made in a meeting. (If the log is blank, you’ll find that people begin questioning why the meeting was held at all.) Oh, yes: start on time. Beginning each hour-long meeting only five minutes late costs a company 8 percent of its meeting time. Most management teams wouldn’t tolerate 8 percent waste in any other area of responsibility.
- End early, particularly if the meeting is going nowhere. If the meeting schedule calls for sixty minutes, most companies’ meetings almost always last the full sixty minutes, whether they need to or not. That’s crazy. At Apple, Jobs used to “call an audible” when the productivity of a meeting started to decline or participants were unprepared. Some people considered his style abrupt, but he prevented the waste of time and money in a session that was unlikely to produce the desired outcome.
Also, don’t forget to manage the invite list. In many companies it’s bad form not to ask lots of participants to a meeting. What people don’t realize is that every additional attendee adds cost. Unnecessary attendees also get in the way. Remember the rule of seven: every attendee over seven reduces the likelihood of making a good, quick, executable decision by 10 percent. Once you hit sixteen or seventeen participants, your decision effectiveness is close to zero. The corollary of this principle is that people should decline invitations to meetings they feel they shouldn’t attend. Attending a meeting ought to be a signal: “This meeting is so important that I am willing to set aside everything else that I could be doing to join with the other attendees.”7
And if too many people show up anyway? Recently, we heard a story about a US undersecretary of defense who was managing procurement. She came to her first meeting with contractors and saw some sixty people in the room. So she said, “Let’s first create a big circle. We’ll go around the room, and everyone can say who they are and why they’re here.” Participants rolled their eyes—did they really have to do something this gimmicky?—but did as she asked. After the first two had identified themselves, the undersecretary said, “Thanks for your interest, but we won’t need you here. You can excuse yourself.” Others met a similar fate. By the time she got to the tenth person in the circle, people all over the room were getting up to leave, knowing they had no real reason to be there. Eventually the group got down to around twelve members—and the productivity of that meeting rose about fivefold.
3. Take a holistic approach
It’s tough to implement reforms like these piecemeal, because people will tend to forget about them. That’s why we often recommend a major companywide effort to change meeting practices. The Australian energy company Woodside offers an example.
Woodside is the country’s largest independent oil and gas company, with a $25 billion market capitalization at this writing and about 3,500 employees. But a few years ago, the mood in the organization was one of frustration. Meetings seemed to be happening all the time; in fact, a survey revealed that staff members were spending between 25 percent and 50 percent of their time in meetings, with senior leaders at the top of that range. Reports were proliferating as well, to the point where most managers were obliged to read three or four every day. And authorizations—just getting a plane ticket, for example—seemed to take forever. For a while, the company was hamstrung. Everyone was aware of the acute organizational drag, but no one could find the time to take action.
Finally, Woodside’s senior leaders decided to break the logjam. They commissioned a diagnostic test to quantify the problem and build a business case for change. The diagnostic test broke down the time spent in meetings by department, by levels of the organization, even by type of meeting. It added up the time of meeting participants to put a dollar figure on the cost. Woodside has an engineering, numbers-driven culture, and these numbers were persuasive. A pilot program, executives decided, would identify a few departments that were struggling the hardest with the time issue and would try out a variety of solutions. Those that worked would be rolled out across the organization.
The pilot project focused on three units, together accounting for about 13 percent of the target workforce. Groups brainstormed ideas, evaluating them on both ease of implementation and likely effect. Then the units began implementation. Some of the ideas were remarkably simple—programming Outlook, for instance, to schedule twenty-five-minute rather than thirty-minute meetings, thus providing people who had back-to-back sessions a few minutes to get from one conference room to another. Others required more effort, such as establishing and implementing “meeting blackout” periods each week. The company tried several other techniques as well. It created tools that calculated the cost of each meeting, based on the number of attendees and the duration. It trained everyone in meeting effectiveness, including coaching gatekeepers (such as executive assistants) in how to control the meeting scheduling process. It assessed every recurring meeting to be sure it was necessary, and it issued weekly reports for leaders showing actual meeting hours compared to personal and team targets.
The pilot project was successful, and the most effective measures were rolled out over the following nine months. The results? Time in meetings was reduced by an average of 20 percent, equating to about 5 percent of total full-time-equivalent capacity. Some 70 percent of the staff reported feeling that meeting effectiveness had improved. “I now feel more empowered to decline meeting invites where my attendance is not necessary,” said one manager. Said another, “My meetings are better structured and more effective as attendees come better prepared to contribute.” A third poignantly revealed just how important such a change can be:
I must admit that I attended the introductory session … with skeptical reluctance. I was particularly shocked to find that I spend an average of twenty-two hours a week in meetings. However, I was not surprised, as a majority of my effective working time has been pushed to late nights and weekends. Both my team and my family were suffering the side effects of my lack of availability.
I have already seen a major improvement in my work-life balance and time spent at my desk. It is the beginning of a journey to make the most of my time in the office and restore my work-life balance.
When a company stops wasting time, people feel as if a load has been lifted from their shoulders.
___________
As Peter Drucker said, time is an organization’s scarcest resource. No amount of money can buy a twenty-five-hour day or reclaim an hour squandered in an unproductive meeting. To get the most out of its workforce, an organization needs to treat time as the scarce resource that it is, creating disciplined time budgets and investing organizational time to generate the greatest possible value for the institution and its owners. Good time management is a first step toward unleashing the productive power of your organization’s employees. In the following chapter, we’ll delve a little deeper and figure out how you can attack the problem at its roots.
THREE WAYS TO LIBERATE YOUR ORGANIZATION’S TIME
- Who knows where the time goes? Using today’s tools, a company can track all the meetings and communications that eat up so many hours. It’s a great way to determine the magnitude of the problem.
- Time is money—and should be treated as such. That means creating time budgets, monitoring time investments, and reducing wasted time.
- Meeting management is essential. Good meeting practices can eliminate vast quantities of wasted time—and can make the meetings that remain far more productive.