Why Doesn’t Leadership Think More About the Cost of Inaction?
When deciding whether to fix an issue in their operations, most leaders run a simple mental calculation:
"How much will this cost to fix?" vs. "How much more revenue will we generate once it’s done?"
If the immediate ROI isn't obvious, the project gets moved to the "someday" list (which, let’s be honest, is the “probably never” list). But there's a critical variable missing from that equation: The Cost of Inaction.
We often fail to consider what the problem is costing the organization just by existing. Every disjointed process or manual workaround is a point of administrative friction that someone on your team has to navigate during their workday and after a while, it may become a much bigger deal than you think it is.
When you choose to ignore administrative friction, the Cost of Inaction becomes both the time/money involved in the slowdown it causes and the possibility of alienating your best people and eventually losing them. In addition to “how much does this issue cost us in lost time and manpower, ask yourself:
How marketable is the person who's currently performing a manual workaround? High-performers don't stay in environments that actively hinder their success. If you think they’re great to have on the team, so will some other organization and they may even be willing to take a pay cut to go elsewhere if the problem is frustrating enough.
How often are they bringing up the problem? If team member keeps flagging a failure point and nothing changes, the countdown to their departure has probably already started. Not only is the existence of the problem frustrating, but so is the feeling that they’re not being listened to.
What are the possible knock-on effects? A bottleneck in one department rarely stays there; it compounds, and creates errors and frustration down the entire chain.
Finally, beyond the spreadsheets and KPIs, there's another incredibly fundamental leadership question: Don’t you want to do right by your people? Sure, you’re in this to make money, to make a solid product or provide a great service and value to your customer, but you and your team are also people. If something at work was causing you constant frustration and someone else had it in their power to fix it, wouldn’t you want them to? If so, do the same for your people.
“Systems thinking” teaches us that an overwhelming percentage of problems are systemic, not personnel issues. If you leave your team to fight a broken system, eventually they’ll just stop fighting and they’ll just leave you altogether. Especially if you’re a business owner, it’s important to remember: your employees don’t care about your business as much as you do- nor should they, really. Don't wait for an important member of the team to hand in their notice before you decide the "cost of action" is worth it.
Map the friction.
Create the roadmap.
Fix the system before it costs you people.