Watch out for those unintended consequences.


Unintended consequences is something that happens when we get so excited about an idea we have that we fail to do enough research to see what will happen if we implement the idea. No matter what the size of organization, it seems that ideas are implemented without much thought of what could go wrong if the idea is implemented.

Here is an example when I worked at a major retailer. At the time there was a store manager plus three salaried assistant managers that handled sales, logistics and operations (customer service). The company decided to do away with the salaried managers and make them supervisors thus cutting payroll because supervisors made less money than managers.

However, there was a major unintended consequence to this move. Since the managers were salaried they often work 50 or more hours per week. That all changed when they became supervisors because that meant hourly pay and of course no overtime. So in other words three people that used to put in a 150 hours per week or more now were only putting in 120 hours per week. You don't have to be a math genius to realize the store loss 30 hours of work per week.

Eventually the company was forced to add another supervisor position to make up for the lost productivity and in the long run spent more money on payroll than they did before. They got so excited about saving money they didn't look at what could happen if they implemented the idea.

Here is another example from the government sector that is happening right now. Governor Jon Huntsman Jr. of Utah changed state workers from 5 days per week to 4 in order to "save gas". However, what the governor did not take into account was the number of state employees taking public transportation. When their hours changed many of them could no longer use public transportation because it did not run late enough so in the long run more people are having to drive now and are using more gas than on a 5 day work schedule. The Governor had an idea that sounded good but the unintended consequences were just as costly.

Whatever actions you take could have unintended consequences. Be sure to thoroughly research what could happen when implanting any new plan or idea. Better to know what might happen than to have it blindside you.

The All Business site is another good resource to see what to and not to do in your business.