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Michael C. Mankins
Chris Brahm
Gregory Caimi
Most companies have elaborate procedures for managing capital. They require a
compelling business case for any new investment. They set hurdle rates. They
delegate authority carefully, prescribing spending limits for each level.
An organization s time,in contrast, goes largely unmanaged. Although phone
calls, e-mails, instant messages, meetings, and teleconferences eat up hours in
every executive s day, companies have few rules to govern those interactions.
In fact, 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 e-mail chains, needless conference calls, and
countless unproductive meetings. This takes a heavy toll. Time devoted to
internal meetings detracts from time spent with customers. Organizations become
bloated, bureaucratic, and slow, and their financial performance suffers.
Employees spend an ever-increasing number of hours away from their families and
friends, with little to show for it.
Most advice about managing time focuses on individual actions. Coaches tell us
to reassert control over our e-mail, be far more selective about which meetings
we attend, and so on. Such recommendations are worthwhile, but executives often
discover that their best intentions are overwhelmed by the demands and
practices of their organizations. The e-mails 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 flood of interactions is how your company gets
its work done, you have little choice in the matter: You have to plunge in and
swim your way to the other side as best you can.
Some forward-thinking companies have taken a different approach entirely. They
expect their leaders to treat time as a scarce resource and to invest it
prudently. They bring as much discipline to their time budgets as to their
capital budgets. These organizations have not only lowered their overhead
expenses; they have liberated countless hours of previously unproductive time
for executives and employees, fueling innovation and accelerating profitable
growth.
By the Numbers: How Organizational Time Is Squandered
Andy Grove, the former CEO of Intel, 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. Of course, such
thievery happens often, unintentionally. Meetings creep onto the calendar with
no clear plan or priority. Initiatives crop up, demanding management attention.
But companies now have time-management tools that weren t available in the
past. With Microsoft Outlook, Google Calendar, iCal, and other scheduling and
messaging applications, they can track where managers and employees are
spending the organization s collective time and thus investing its resources.
The calendar data show how many meetings are occurring each week, month, or
year and what kind they are. They show how many people are attending, by level
and function within the organization. They even permit the tracking of certain
organizational behaviors, such as parallel processing and double booking, that
occur before, during, and after meetings. Of course, a company scrutinizing
such data needs strong safeguards to protect employee privacy; nobody wants the
feeling that Big Brother is watching his every move. But this information can
paint a vivid and revealing picture of an organization s time budget.
Bain & Company, using innovative people analytics tools from VoloMetrix (on
whose board Chris Brahm sits), recently examined the time budgets of 17 large
corporations. Here s what we discovered:
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. Many executives
now receive some 200 e-mails a day more than 30,000 a year and the increasing
use of IM and crowdsourcing applications promises to compound the problem. (See
the exhibit The Dark Side of Metcalfe s Law. ) If the trend is left unchecked,
executives will soon be spending more than one day out of every week just
managing electronic communications.
Meeting time has skyrocketed.
Executives are also attending more meetings. That s partly because the cost of
organizing them has dropped and partly because it s far easier than in the past
for attendees to take part via telephone, videoconferencing, screen sharing,
and the like. On average, senior executives devote more than two days every
week to meetings involving three or more coworkers, and 15% of an organization
s collective time is spent in meetings a percentage that has increased every
year since 2008. These gatherings proliferate: See the exhibit Ripple Effects.
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% 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 sharing information rather
than gathering input or brainstorming alternatives. In short, more time spent
interacting has not produced significantly more collaboration outside
organizational silos.
Dysfunctional meeting behavior is on the rise.
At most of the organizations we examined, participants routinely sent e-mails
during meetings. At one company, in 22% of meetings participants sent three or
more e-mails, on average, for every 30 minutes of meeting time. Furthermore,
executives commonly double-booked meetings and decided later which one they
would actually attend. 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.
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.
It s hard to know exactly how much of this squandered time could be rescued.
But our data suggest that most companies have an opportunity to liberate at
least 20% of their collective hours by bringing greater discipline to time
management.
Eight Practices for Managing Organizational Time
A handful of companies have learned how to attack this problem directly. They
create formal budgets to manage organizational time as the scarce resource it
is. They purposefully curb demands on executive time. And they push their
people to improve the productivity of meetings and other forms of
collaboration. We find that the following eight practices pay big dividends:
Make the agenda clear and selective.
One hallmark of great leaders is their ability to separate the urgent from the
merely important. They know that everyone must share an understanding of which
activities are critical to success. We advocate broadening that understanding
to include time priorities. Not only should people be crystal clear about how
to spend any extra time they may find in their day, but they should know what
they can safely postpone or ignore.
Perhaps no other executive managed organizational time more effectively than
the late Steve Jobs. Focus was a key to Apple s success. Each year Jobs took
Apple s top 100 executives off-site for a planning retreat and pushed them to
identify the company s leading 10 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 to everyone present what the
company would and would not take on. Jobs cut through the noise and enabled
Apple to invest the time of its top talent strategically, without dilution or
waste. This dramatically accelerated the pace of innovation at the company and
helped it become one of the largest in the world by market capitalization.
Create a zero-based time budget.
Increasing workforce productivity requires that every organizational asset be
carefully managed. Accordingly, many companies develop their operating and
capital budgets from scratch each year, rather than taking the previous year s
budget as a starting point. The best companies have zero-based time budgets as
well. Their mind-set is: We will invest no additional organizational time in
meetings; we will fund all new meetings through withdrawals from our
existing meeting bank.
Take Ford Motor Company. When Alan 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 35 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.
In late 2006 Mulally asked his team to ruthlessly assess the efficiency and
effectiveness of the company s regular meetings. It quickly eliminated all
unnecessary ones and shortened those that were unduly long, which forced people
to maximize output per minute of meeting time. The team 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), which has replaced meetings week. It brings together the company
s most senior executives in a focused four- to five-hour session each week to
set strategy and review performance. Content for the session is standardized,
reducing the extensive prep time previously required. The implementation of the
BPR 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.
Require business cases for all new projects.
Companies often fall victim to initiative creep, as seemingly sensible
projects are added incrementally. Few if any of them are ever formally
terminated. When Gary Goldberg became CEO at Newmont Mining, in March 2013, 87
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 cases for all the company s ongoing and proposed projects.
Before investing any time in one of them, the ELT had to review the case and
approve the effort. Each case 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 projects that had been
under way when Goldberg took over were discontinued because no business cases
were presented for them. Others were not approved. After less than three
months, Newmont had scaled back the number of initiatives by a third and
refocused its collective time on improving safety and operational efficiency.
Simplify the organization.
The more management layers between the CEO and the frontline worker, the slower
the information flows and decision making. All managers know this, even if many
fail to act on their understanding.
What they often don t realize is that every additional supervisor adds costs
well beyond his or her salary. Supervisors schedule meetings; those meetings
require content that some people must generate and others must review; and each
meeting typically spawns even more meetings. We have found that on average,
adding a manager to an organization creates about 1.5 full-time-equivalent
employees worth of new work that is, his own plus 50% of another employee s
and every additional senior vice president creates more than 2.6. The caravan
of resources accompanying a manager or a senior executive, which may include an
executive assistant or a chief of staff, adds further work and costs. (See the
exhibit The True Cost of Your Next Manager. ) As the work piles up, time grows
ever shorter.
Given the direct and indirect costs of most supervisors, one way to improve
organizational efficiency is to simplify, starting at the top. In 2010 the
University of California at Berkeley was facing tremendous financial pressure:
The state legislature had cut $150 million from Berkeley s budget in response
to a mounting deficit. To safeguard the funds needed to preserve the university
s reputation for excellence in teaching, research, and access, the
administration had to find ways to streamline its cost structure.
In the summer of that year, Robert Birgeneau, then the university s chancellor,
launched what was known as Operational Excellence. The program s objective was
to dramatically improve the efficiency and effectiveness of the HR, finance,
IT, and general administrative support provided to Berkeley s 14 colleges and
more than 100 departments. By standardizing and simplifying work by function
and sharing management across those units, Operational Excellence removed
hundreds of unnecessary supervisors and freed up an enormous amount of
organizational time. The restructuring and simplification has saved the
university some $120 million annually while enabling Berkeley to deliver more
with less.
Clearly delegate 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.
For example, leaders at one large manufacturing company recently discovered
that a regularly scheduled 90-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 VP s
administrative assistant was permitted to invest $15 million without supervisor
approval. No such thing would ever happen with the company s financial capital.
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 60 minutes to 30 minutes. Second, it
established a guideline limiting meetings to seven or fewer participants. Any
meeting exceeding 90 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 200
full-time employees over a six-month period.
Most companies place few restrictions on who can organize a meeting. The
result: Costly meetings are scheduled without scrutiny.
Standardize the decision process.
At many companies, decision rights and processes are so ill defined that the
organization devotes more time to managing the matrix than to decision making
and execution. In such cases, establishing an organization-wide approach to
decision making can greatly improve efficiency and rescue time for other
purposes.
Woodside, Australia s largest independent oil and gas company, is illustrative.
The company had been operating with a matrix structure for a number of years.
Although the matrix was designed to foster greater collaboration across the
company, decision authority and accountability were murky. As a result, the
time spent coordinating across functions and business units was rising steeply,
adding costs. In 2012 Woodside s leadership explicitly defined a set of
operating principles that spelled out responsibilities, authority, and
accountability for the business units, the functions, and the corporate center.
A broad training program helped ensure that the company s top leaders
understood the new principles and the implications for their units. A small
network of navigators was established to help remove roadblocks and accelerate
decision making across the company.
The impact of these changes has been profound. Given clarity on who is
accountable for important decisions, executives at Woodside have streamlined
how those decisions are made. A significant portion of the resulting saved time
is now spent on efforts to improve execution and identify new growth
opportunities.
Establish organization-wide time discipline.
No company can eliminate all meetings they 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:
Agendas with clear objectives.At Intel all meetings start with a clear purpose:
to inform about topic A, discuss topic B, and decide topic C. As simple as that
may sound, the procedure focuses attendees on accomplishing the specified
objectives.
Advance preparation.At Ford, all materials for weekly Business Plan Reviews
must be distributed in advance so that participants can review them before the
meetings. That greatly reduces the time devoted to information sharing during
BPRs.
On-time start.Beginning each hour-long meeting only five minutes late costs a
company 8% of its meeting time. Most management teams wouldn t tolerate 8%
waste in any other area of responsibility.
Early ending, particularly if the meeting is going nowhere.Steve Jobs used to
call an audible when the productivity of a meeting at Apple started to decline
or participants were unprepared. Some people considered his style abrupt, but
he prevented the waste of time and money when sessions were unlikely to produce
the desired outcome.
Provide 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 e-mail 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, it is impossible to set targets for improvement.
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, are experimenting with giving their
executives feedback on the load they are putting on the organization in terms
of meetings, e-mails, 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. Time is
an organization s scarcest and most often squandered resource. No amount of
money can buy a 25-hour day or reclaim an hour lost in an unproductive meeting.
To get the most out of your employees, you must treat their time as precious,
creating disciplined time budgets and investing effort to generate the greatest
possible value for your company.
Michael C. Mankins is a partner at Bain & Company. He is based in San Francisco
and heads Bain s Organization Practice in the Americas.
Chris Brahm is a leader of Bain s Technology practice in the Americas and a
partner in San Francisco.
Gregory Caimi is a partner in Bain s Technology and Organization practices
based in San Francisco.