A business created to make computer game graphics more beautiful stumbled into driving AI, one of the most important technologies of the 21st century. Rathbone Greenbank Global Sustainability Fund manager David Harrison explains what all the fuss is about.
There are still three long weeks to go until the UK heads to the polls on 4 July. One of the more wearying aspects of electioneering is the daily deluge of headline-grabbing policy initiatives intended to sway swing voters. An awful lot of spaghetti is being flung at the wall in the hope some sticks.
Call me cynical, but much of this pre-election noise feels like what American author and academic Cal Newport identifies as “pseudo-productivity” - busyness for busyness’ sake. If you’re frenetically doing something (almost anything), you’re not slacking and that’s useful, right?
Busy doing nothing…
Newport argues that visible activity is a very crude proxy for meaningful accomplishment. He’s a computer science professor so he’s particularly focused on what he calls the “hyperactive hive mind” of the tech world and other ‘knowledge’ industries that depend heavily on their workforces’ brain power to generate revenues.
He believes we’re pretty hopeless at defining what productivity means when it comes to tech workers toiling away at their laptops. If you manufacture widgets, you can measure productivity by counting how many get made in each shift. It’s much harder to gauge the output of a gazillion tech worker bees endlessly buzzing away at their email inboxes and chat channels.
In his blog, Newport notes that Manchester United’s new part-owner Sir Jim Ratcliffe recently decided to end the club’s flexible work-from-home on Fridays policy. Why? Because he’d found that when he’d allowed staff at one of his other companies to work at home on Fridays, their email traffic dropped by 20% that day.
Newport argues that email number-crunching simply isn’t an effective way to measure useful effort. Indeed, in his latest book Slow Productivity: The Lost Art of Accomplishment Without Burnout, he claims that email traffic is just the kind of pseudo-productivity that looks like we’re getting a lot done but in fact diverts and distracts us from actual accomplishments.
He suggests a three-step solution that might lead to less worker overload on the one hand and getting more and better work done collectively on the other: do fewer things; work at a natural pace; and obsess over quality.
Of course, Newport’s slow productivity philosophy is targeted most at specific people and environments, notably knowledge workers in hybrid offices. But the principles he advocates do have relevance for broader business and investment themes.
Why bigger isn’t necessarily better
As we explain in our latest webinar, there are powerful arguments to suggest that for many businesses less really can mean more. The era of 1980s-style mega-conglomerates is way behind us, but too often companies still argue the case for diversification away from their core expertise. It’s easy to assume that doing less as a company implies slacking. But those businesses that try to juggle multiple conflicting goals and priorities can risk losing their focus and, over time, that may drain their competitive edge.
In the end, what really matters is tangible results and longevity. Sometimes, the best course of action might actually be to get smaller…
Consumer goods giant Unilever is doing just that. It’s announced plans to jettison its ice cream division to focus on 30 of its so-called ‘Power Brands’ (household names like Hellman’s, Dove and Cif) that account for about 75% of group turnover. Unilever isn’t just seeking a leaner organisational footprint, it’s also determined to deliver its mega-brands better.
Indeed, Unilever’s new CEO Hein Schumacher sounded straight out of the Slow Productivity playbook when he recently committed to doing “fewer things, better, and with greater impact”. Schumacher thinks these goals are best served by steering well clear of a “constant churn of new news that doesn’t really shift the dial.” Unilever’s new Growth Action Plan is in its infancy and the consumer space is highly competitive, but we’re enthusiastic about the changes afoot.
In the pharmaceutical industry, businesses like GSK and Novartis have also decided to get smaller and to sharpen their focus on fewer key areas. Both have seen step-changes in their profitability as a result.
In the utilities sector, SSE and National Grid are at a different stage of the ‘less is more’ journey. The former sold its retail energy supply business several years ago when it decided to concentrate on building out vital next-generation grid infrastructure. That’s enabled it to develop into a business whose core focus is electricity infrastructure and is investing a whopping £10 million a day as it does so. National Grid is currently raising funds to facilitate its updated £60bn five-year investment plan in transmission grid assets both here in the UK and over the pond in the US, while simultaneously planning to divest itself of non-core assets.
In their different ways, all these businesses show that the more you care about the quality of the things you can do best, the more pseudo-productivity doesn’t seem worth it. Maybe all our noisy politicians could learn something here?
