The Pullman Problem
A couple years ago, I stumbled across a series of articles from 1916, published in a business journal called System. The articles detail how the Pullman Company (famous for their eponymous train cars) arrested their slide away from profitability by systematically overhauling their operations.
As I detail in an essay I wrote for Fast Company, a big factor in Pullman’s early 20th century problems would sound familiar to early 21st century ears: communication overload.
As Pullman president, John Runnells, explained, many departments were run with “confusing unrelated systems [that] had been spontaneously developed.”
The result is that everyone was a little involved in everything — disrupting their ability to do their primary work.
If you wanted something from the brass works, to cite an example given in the 1916 articles, you would go over to the brass works and bother someone you knew until you got what you wanted– distracting both of you from your main value-producing crafts.
As Runnells sagely observed, if you don’t build optimized systems to handle logistics, the effort simply gets offloaded, in an ad hoc and disruptive manner, to everyone: “and every man contributing by that much [to these organizational efforts] demoralized his own particular work by the interruption.”
A Century-Old Problem
This of course is the same problem faced by many modern knowledge work organizations. We hook up to email addresses and Slack channels and then just rock n’roll with messages all day long, trying to work things out on the fly, and hoping busyness will transmute into value.
This need to constantly monitor an inbox brimming with ad hoc messages, in other words, is simply the Pullman brass workers’ dilemma magnified to a new extreme by the electronic efficiency of digital networks.
Which is all to say that we should take seriously the solution Runnells and his team successfully deployed to turn around their company’s flagging fortunes: they made communication harder and less convenient.
As I detail in the Fast Company article, among other things, Runnells hired many more managers to do nothing but handle the logistical issues that used to distract the skilled factory workers. He also barred the door to the brass works to outsiders: if you needed something, you had to fill out a relevant form and send it through a special slot for a dedicated manager to process.
Hiring the managers was expensive.
Barring the doors was inconvenient.
But it was worth it: Pullman’s profit per train car jumped by over $100.
In today’s world, we assume faster communication and more convenient collaboration will always help the bottom line. We would be smart, however, to keep in mind the lessons learned by yesterday’s business leaders: making things harder isn’t necessarily bad.
14 thoughts on “An Early 20th Century Lesson on the Difference Between Convenience and Value”
What an interesting business lesson from the past! Runnells essentially built a more effective system for processing information within his company. In today’s time, it is also important that we build personal systems to handle the amount of communication and information that we receive on a daily basis. Thanks for sharing your perspective on convenience and value!
Is that how nightmarish bureaucracy gets started?
Interesting I am doing almost similar thing by shielding engineers from being directly assigned a new task without Manager’s approval and giving them one main task for a sprint that way they are focused on doing that one task well.
Hello Cal, this is Konrad from Stuttgart/Germany. I have read your book “Deep work” in 2016 (english version), it is a great contribution to us digital workers! In Germany the creative Industries, according to statistics, are structured like this: 98% are small companies (1-10 People) (like my company). Means that few people have to do a great variety of work and division of labour is not possible like in bigger companies, to achive undistracted areas. So the solution I can see is to divide TIME instead of LABOUR – and to live as a temporary digital hermit with 2-4 hours undistracted work per day. (as written in your book). Kind regards! Konrad
Interesting perspective as usual, Cal. Thank you!
One way to flip this around is to talk about focus (positive) instead of distractions, shielding, protecting (negative). We are experimenting with the “office hours” concept with our engineering teams. Essentially the senior engineers get to focus all day while they dedicate an hour every day to help other engineers (usually juniors) and anyone else. This provides an opportunity to say “No” more often and redirect folks to this dedicated “office hours”.
I think that this also demonstrates how organizing work and making decisions on who does what when is valuable and time consuming. That there is a benefit to having certain individuals in a management role who specialize in organizing work instead of having everyone try to organize and perform the work.
Interestingly, it seems like a lot of managers get pulled away from actually managing and into other responsibilities. Perhaps this calls for a more radical refocus on people and project management skills within certain positions?
To your brilliance!
If you pay these skilled workers by their production then this problem will be solved without adding middle managers. They will then not entertain these distracting parasites trying to consume their precious time and productivity. Then the parasites will have to fend for themselves.