Us leanies hate waste. We go after it with a passion and vigor that has few equals. But in our zeal could we be going too far, and actually decrease value? That’s the question that popped into my mind after reading Steve Conover’s latest post over at The Skeptical Optimist. You get a sense of where he’s going from his opening ramblings…
I dislike waste as much as anyone else does. Whenever a baseball pitcher gives up a hit, every pitch thrown during that at-bat turns out to have been wasted. No doubt about it: all baseball pitchers are wasting their arms on a high percentage of their pitches.
Whenever a tennis player loses a game, every stroke in it was wasted; likewise, losing the set wastes every game in it, and losing the match wastes every set. Both winning and losing tennis players are wasting a large portion of their energy and talent, aren’t they?
If you haven’t guess it, here’s his point.
The problem with shallow thinking is that in most cases it’s impractical or impossible to eliminate the waste, and in many other cases we shouldn’t want to eliminate it. Why? Because much "waste" is inextricably built into a process that yields overall positive results.
We should still attack waste, but be more careful.
Don’t get me wrong: waste that can be eliminated without any undesirable side effects should be eradicated without hesitation. Let’s give the positive, unpredictable surprise every chance to emerge. Let’s eliminate waste that we can isolate from productive spending. Let’s spend and borrow as necessary to encourage the positive Black Swans and to prevent the negative ones. We need a paradigm shift, and all such progress generates some degree of "waste." Why not focus on the former instead of the latter?
Larry Kudlow correctly keeps reminding us of what Reagan used to say: "Okay, you showed me the manure. Now show me the pony."
So be careful when attacking waste. Trying new ideas, new cell configurations, new training methods… even if they fail they will probably eventually add value.