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Tag: cost control models

Cost-cutting is upside down and inside out

Inverted by mgjefferies via FlickrTwitter culture

Twitter is such a good example of the benefits of distributed, leaderless, co-creation.  Lots of grown-up lol cats like what we are cooking!  Yes, I am serious.

Today, I was working on some tedious table creation in Excel and I dipped in-and-out of Twitter as brain relaxation between chunks of work.  This wasn’t time-wasting, at least not for me, because as any half-decent psychologist knows, we can’t  work much longer than 10 to 15 minutes at  a stretch without taking a mini-break to manage fatigue and to restore a sense of what is woods and what are trees.

Some back and forth between @loudmouthman @freecloud @dt and I soon created the ultimate Twitter experience – the total confusion much decried by Twitter’s critics and the insights to weave together several half-finished conversations that I’ve had while I’ve been buried in Excel.

I resolved to write down why I find the political conversation around the budget cuts so dissatisfying.

Cost control models are no substitute for strategy or leadership

Controlling costs is nonsensical as a leadership strategy.   Accountants out there don’t have a heart attack!  We still want you to count the beans  but the purpose of life is not to control costs.   Remember what Napolean called us : a nation of shopkeepers?  I rather admire shopkeepers and the till must be ‘manned’ ; but a till does not a shop make.

  1. Cost-added models are passe. I am not going to be happy with a teacher or a doctor because they cost more, or they cost less.  I will not buy a Snickers bar either just because it cost you  a shilling or a florin to make.  Let’s wise up.  Cost is not important. Value to the consumer or citizen is important.
  2. Public services aren’t discretionary.  We have public services because we need them.  Public services are not a luxury.  If we cannot afford them  we are done for.  Though the army is the extreme case it makes the point clear.  If we cannot afford to defend ourselves, then we will have to reconstruct our entire nation-model because, in short, someone else will be in charge. The only discussion worth having in the public service is what is essential and why. What do we have to make happen?  When we have agreed on what is essential, we will make it happen.  We aren’t dunces (or at least we aren’t that hopeless).
  3. Cost-focused models assume virtue matters. Since when did the English believe in cause and effect and a grand idea?  (Not sure about the Scots, Welsh and Irish).   The international financiers may like us because we control our cost; and just as easily they might not.  I am betting they won’t because their essential psychology is macho.  Show weakness and you are done for. Show that you are willing to cut your own people off at the knees and your essential bargaining  position is gone.  They know you will agree to anything.  Bad move.  Any cost-cutting should have been done very very quietly.

What is the alternative to government by book-keeping?

So if I take away your cherished dream of a country run of us, by the book-keepers, for the bookkeepers, what is the alternative?

  1. Do the work.  Decide what is essential and do it.
  2. Understand innovation.  Let people get together and thrash out ideas.  1/200 may be worth it.  Budget for 199 being trashed.
  3. Put in good accounting systems so we can pay Ceasar what is due to Ceasar when it is due.  This is not living by cost control.  It is simply having good book-keeping so we can get on with our lives without constant cash flow crises.   A cash flow crisis tells us that we had shoddy book-keeping not that we spent too much money.  Though both may be true, we cannot have a crisis without bad book-keeping. Restore some professionalism in public book-keeping (=make the data public).

The country is just like our house

Conservatives tell us that running a country is no different from running a household or running a shop.  Many of us might challenge that statement but let’s take what we learn from running a household or running a  shop.

  1. Necessities are necessities.  We can’t provide them unless we know what they are and unless they come before everyone’s luxury.  Necessities are necessities.
  2. A day out designed by Mum and Dad will be a day out with whining kids in the back seat bored at the restaurant table. Plan this outing as a family affair using everyone’s ideas.   Good things do not come out of pre-defined criteria. Good things come out of us working together to enjoy our lives.
  3. Budget simply.  The envelope system works fine.  Put money for the rent, electricity and food aside.  People aren’t daft.  They will figure out how to have fun with what’s left in the fun jar.

Twitter is a fine example

And all this for wasting time on Twitter.   No, all this from following some basics.

  • I had set my goals for the day.
  • I am working consistently.
  • I am putting some ease into my day so my mind doesn’t wander and create rubbish that I will have to redo later.
  • I am being creative in breaks from necessity and the “hardness” of rule-bound behavior.
  • I have a list on my pad and I time myself.  My bean counting adds to my life by telling me where I am.  If something very important came up, I could switch my priorities easily.

A week of Excel is a hard week – not unlike a financial crisis.  I’ll get through it better by keeping my goals clear but in their place allowing some ease and respect for the people in my life and what is truly important.

Oh, let me be blunt.  Some people need to stop behaving like pratts.

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