We all have times when we do not like to follow rules. Nevertheless, D. Scott Davis (CEO of UPS) reminds us of their value in a large company. Devin Leonard, interviewing Davis, asked him about the mountain of rules thrust upon UPS drivers (“The Interview Issue” Bloomberg Businessweek 8/12/13–8/25/13, p. 94):
“Your drivers have to follow 340 rules. Why so many?”
Davis’ response emphasizes how rules direct operations, operations involve time, and time always equals money:
“We have always been perceived as one of the better operating companies in the world. Every minute is critical. Five minutes of congestion—for an average truck in the U.S. that has to wait for five minutes a day—it’s $105 million a year for UPS. We have to figure out how to do better.”
What Davis articulates is an age-old business reality. Every minute truly does count either for profit or for loss.
The challenge so often is companies develop some excellent rules to improve efficiency and effectiveness, but they fail to communicate them clearly. Employees at the bench level either never hear the rationale behind the rules or they do not understand them. In some cases, they never even hear the rules at all. These scenarios lead to misunderstanding and alienation. Employee engagement declines and everyone suffers, including the customers.
Therefore, a company should create the rules that will deliver the best performance while simultaneously clearly communicating those rules and their rationales to every employee. Only then will the company have opportunity to reach its maximum performance.
Finally, this is never a “one and done.” It is a process of continuous improvement. Wherever you find the best companies, you will find this to be true. Wherever you find the worst companies, you will find the opposite.