Cheaper by the Dozen? Balancing Efficiency and Slack in Marketing
What would it be like to be raised in a home where the primary metric was efficiency? The New England home of Frank and Lillian Gilbreth and their 12 children doubled as laboratory for “time and motion” studies. Is it faster to wash arms or neck first when bathing? Would family meetings improve if run like board meetings? How best design a kitchen to avoid extra steps if simultaneously making a cake and washing dishes?
“The search of the One Best Way of every activity, which is the keynote today of industrial engineering, applies equally well to home-keeping and raising a family.” Lillian Gilbreth (1925)
The Gilbreths, two of the foremost efficiency experts of their day, were enthusiastic disciples of the field’s pioneer, Frederick Winslow Taylor. In the semi-autobiographical book and light-hearted 1950 movie, “Cheaper by the Dozen”, Gilbreth kids parade Tayloristic antics in their 1920’s domestic setting.
However, Taylor’s work is no joke. Business guru, Peter Drucker, called Taylor’s book, The Principles of Scientific Management, “the most powerful as well as the most lasting contribution that America has made to Western thought since the Federalist Papers.” A huge slice of commonly accepted operational practices started with Taylor. Measurement, specialization, planning, training, standards, best practices, professional management, and organizational hierarchies were born on 20th century industrial shop floors. After demonstrating astonishing productivity improvements, Taylor’s tenets spread to business (white collar workers learned how to clip papers in the “one best way”), government, military (the U.S. used Taylorism to ramp for WWII), schools, churches, and homes (thank Taylor and Gilbreth for the location of your kitchen cooktop and sink).
Efficiency is good for marketing.
Marketing benefited from recent efficiency improvements. The CMO’s gains in the executive ranks were made possible by Martech, intelligence, and process best practices. Earlier, marketing functioned like the loose craft guilds Taylor and the Gilbreths eradicated. Precise measurement was non-existent. Best practices were the purview of only experienced workers. Marketers learned necessary rules-of-thumb, tips, and trade secrets only after years of commitment. When CEOs asked for campaign ROI, they got hand-waving and beautiful slides.
Efficiency practices tighten operations by seeking to achieve the greatest output from the fewest inputs (e.g., cost, labor, energy, equipment, time). These are not bad metrics. Marketing organizations, especially those in the early stages of automation and marketing operations, should continually improve efficiency. All things being equal, it is better to have lower cost campaigns, for example, than competitors.
However, all things are not equal.
Strategic marketing inefficiency (slack) is crucial to business health.
Because marketing works in a VUCA (volatile, uncertain, complex, ambiguous) environment, effectiveness depends on more than efficiency. The agility, innovation, customer experience, and resilience required for today’s success require extra investment that – in the short run – make marketing less efficient.
Here’s an example of how efficiency as a singular driver can lead to inferior outcomes. Emma’s campaign has better ROI (an efficiency metric) than Ahmad’s if her campaign produces 100 leads with a $10,000 budget while his produces only 80. However, consider these factors.
Agility: Did campaigns attract desired new customers or expose existing deals from current customers?
Innovation: Did either campaign experiment in order to learn?
Customer experience: Did either campaign delight customers leading to better Net Promoter Scores or larger deals over time? Alternatively, did either produce “collateral damage” by tricking or spamming prospects?
Employee potential: Did marketers gain new skills? Is Ahmad new to the job?
Resilience: Did either campaign improve brand perception, or increase partner capability?
Excellent marketing requires slack. Slack provides flexibility to recover from delays, to make updates, recover, regenerate, and repair. Time-slack gives teams an opportunity to experiment and generate new ideas. Budget-slack provides investment to advance marketing effectiveness. I previously ran the annual IDC Tech Marketing Investment Survey. We found that running marketing too tightly, with too little budget compared to peers, correlated with lower revenue growth. Starving marketers can only keep the lights on. Consider how poverty impacts families. A little extra money provides better healthcare, more education, less stress on relationships, and the ability to weather downturns.
Find the sweet spot that balances efficiency and slack.
The Gilbreth kids titled their book after their father’s favorite retort. When inevitably asked why so many children, Frank Gilbreth would appear to ponder the question seriously then reply, “They are cheaper by the dozen.”
Well-run households don’t make every decision based on efficiency. Neither should well-run marketing organizations. Success in the VUCA environment of the digital marketplace requires a balanced approach. Enough efficient “tightness” to avoid chaos and achieve reasonable competitiveness. Enough of slack’s “looseness” to improve agility, innovation, customer experience, and resilience. While operating in the sweet spot requires a resource premium compared to high efficiency, it’s the only sustainable position for effective marketing today.