This cliché is often associated with physical or mental fitness. Jack LaLanne, who died recently at the age of 96, said once “It’s better to use yourself up than to just sit around and rust.” Wise words from another kind of old lean dude. Taiichi Ohno frequently used the human body as an analogy for business, which may well have led to the term “Lean” to coin the system that Ohno and his contemporaries gave birth to. So the phrase ‘use it or lose it’ occasionally arises in Lean discussion as a reminder to exercise our minds and practice reliable methods.
But in this post, I’ll touch on a negative connotation of ‘use it or lose it’, one that relates to panicked decisions that are made to accommodate questionable policy. I was reminded of this last week as I spoke to a potential customer who had just returned from vacation:
“I hope you had a nice vacation,” I said.
“It was okay,” she replied, “I had eight days to use up by the end of February or I would lose them. I worked a bit from home so I wouldn’t fall too far behind.”
This is a ‘use it or lose it’ situation that many companies and employees face. Companies are reluctant to carry accrued vacation forward as a burden on future budgets; and, in any event, good HR practice should encourage that vacation time actually be taken. The IRS even allows organizations to transfer unused vacation pay to an employee’s 401K, but apparently few companies have exercised this option. Forced vacations are still commonplace. And when they occur ‘in batch’ across an entire organization, they are disruptive to customer service and damaging to morale. A depleted workforce working overtime is an ineffective, stressful and costly by-product of forced use of vacation time.
But this situation pales by comparison to the end of year spending binges that occur in the public sector. Grade school teachers and hospital administrators, professors, managers and governmental agencies scurry at the end of budget periods to spend every last penny in their budgets for fear that if the money is not spent it will be allocated elsewhere in subsequent budgets. While schools, towns, states and our federal government struggle to find the means to keep basic operations running, they are penalized for demonstrating savings at a period end. If Benjamin Franklin were alive today, he would have to revise his aphorism: “A penny saved is a penny lost.”
Working in the private sector for most of my career, I viewed yearend public sector spending gluts as a bonanza: a means to beef up sales at year-end. These sales spikes (Mura) came at a premium however as we expedited parts from suppliers and worked overtime to meet artificial deadlines. It was like drawing a chance card in Monopoly (e.g., “University lab must spend $250,000 by year end, and the order for product X is yours!”) Unfortunately, such speculative ordering often activates resources to build items that are not really needed at the expense of real need. When customers are forced to guess at their needs they are at best ordering too soon or too much, and likely ordering something that isn’t needed at all. This would be considered overproduction, the worst of the 7 wastes. The goal regrettably is to hit the budget, not to serve the customer….and the balloon bursts as soon as the end-of-period deadline passes. And as for the person who took the forced eight-day vacation lest she ‘use it or lose it’, that would be the 8th waste: loss of human creativity, the ultimate ‘use it or lose it’.
What other unproductive ‘use it or lose it’ examples can you think of? Please share with us.