There's always been a concept of two important things that drive most of what we do in business - time and money. Think about it. We have the common construction saying of "time and materials". And whether it's in brokerage lending, or appraisal, it's usually a question of how much does it cost and how long will it take. Well, it seems that some Harvard professors have looked at this from the perspective of scarcity; sort of like supply and demand. But they've taken it a step farther and really examined how scarcity and our flawed responses to it impact our lives, society and culture.
They set out to answer things like why do successful people get things done last-minute? Why do organizations get stuck putting out fires as opposed to planning? The book is simply called Scarcity: Why Having Too Little Means So Much, by authors Mullainathan and Shafir. And while it's a book on social commentary more than anything else, as I perused it and got a better understanding of why the busy stay busy and how scarcity can lead us astray, it also had some really good business lessons.
What I found to be the most interesting part of this book was its examination of what they call "bandwidth tax". Which means that if we are working up against scarcity, we will exhibit behaviors that require constant, energy depleting vigilance that keeps us from being mentally engaged. We may be physically present for something that is enjoyable, but we may not be mentally there because we are concerned about fixing the "scarcity" issue.
I think the biggest benefit of scarcity is that it clearly is the mother of invention. The silver lining is that it drives innovation. I think over the past number of years many of us have witnessed this personally. We sometimes live by the adage "why mess with success," meaning when times are good we stick with what's working because it served us well so far. Conversely, when things aren't so good and opportunities are scarce, smart people and companies work to become more effective as opposed to just streamlining and becoming more efficient.
I think I've discovered over the years that I actually prefer to work under conditions of scarcity. I need tight schedules and tight budgets and I've discovered the reason why - focus. Yep, it's all about focus. Let's face it we know for sure whether it's time or money, if we have more than we need of either one it will negatively impact our focus. When the deadline is four weeks out it's easy to dawdle for the first two weeks. The same with money, which is particularly true for those who live in a world paid by commissions. We tend to always believe that we can get that money, but typically we don't put a big enough sense of urgency on obtaining it. This was illustrated by an exercise used by a good sales trainer I had. He would pose the problem as a need to raise $10,000 by the end of the day to bail your innocent mother out of jail. For most of us that created a strong sense of urgency and most of us could get it done.
Scarcity gives me the motivation to say, "it'd be nice to go over that again, but we simply don't have the time or money." It makes me focus on how to creatively hit the deadline, as well as stay on budget. Supposedly I'm not alone. Given the choice, many of us would say that we would rather be given a problem with plenty of resources to throw at. But our actions speak otherwise. Where do you fall?
