Archive for November, 2011

Learning and earning our way out of borrowing too much

November 12, 2011

The slow economy is a crisis for individuals, families and communities in many western countries. For a decade or more, many western economies have borrowed more than they have earned. Politicians now have to reduce public spending to avoid borrowing even more money. Reduce spending to keep the interest repayments down on what our country has to repay every month.

Yes, our credit bubble was made much bigger by banks slackening their credit controls to sell more and more loans to us (and to buyers of the loans). Politicians are more likely to allow inflation to erode our debts (by “printing” unearned money and allowing the currency to devalue) while we wait for them to create jobs. Inflation would also erode the value of our work and any savings we have left.

In seeking a living wage, all of us need work that adds enough value for all to be rewarded so all can look after their families, communities and ourselves? Therefore potential earners need help to measure the sustainability of their behaviors, skills and knowledge (competence). Providing jobs for incompetent people or insufficient competent people gets us nowhere. Schools, colleges and companies all have role to play in enabling the skills and knowledge of workers to add enough value for viable careers, fruitful families and successful communities.

Some politicians have had the honesty to admit that recovery will take ten years. We need at least as much time to repay as it took us to borrow the money we had not earned. Changing what we do to ensure our work adds value faster means we can also repay our debts faster.

Or are we waiting for politicians to create jobs?

Work, not jobs, is the key. Jobs are a departmental concept. Jobs occupy functions to further careers and claim bonuses. Jobs like this add no value for customers. Jobs like this put us deeper in debt. Better to determine how our work adds value. In both the private and public sectors, our work has to add value for customers (includes taxpayers) who are able and willing to pay. Our cross-functional work can add value faster to earn more for all of us.

Our work becomes meaningful in process teams as together we create more successful customers.

First we have to understand our processes. Then we need to be competent, applying our skills and knowledge within these processes for the benefit of customers. But far too many skilled and knowledgeable people work in departmentalized organizations that waste 40% of their efforts to serve customers. Two days a week on rework, pointless work and repair. Too many organizations neglect their cross-departmental processes for adding and enabling value. In short they neglect their process-based management systems.

How can we improve the economy for ourselves, our children and our communities? Process-based management systems can make everyone’s work more effective and then more efficient. Management systems can help all of us to determine and fulfill the needs of our customers. Process-based management systems that are self-improving so they help us to prevent loss while speeding the rate at which our work adds value.

All of us can create sustainable and satisfying work lives so we earn our standards of living.