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Economic Effects of Multitasking on an Organisation

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Bob Hartman, Founder and Partner at Agile For All and Certified Scrum Trainer and Coach, recently wrote an article on Peter Drucker’s view is integral to the values of Scrum. In this article he explained how multitasking negatively impacts an organization economically and illustrated Peter Drucker’s quote

Concentration is the key to economic results. No other principles of effectiveness is violated as constantly today as the basic principle of concentration

Bob emphasized on the scrum value of “focus”. He says:

It is rare when we start working with clients to see any sort of focus at any level of the organization. Multitasking is not only rampant, but being able to do it well is considered an admirable attribute! It is clear to me that most managers and executives don’t understand the huge toll multi-tasking takes and how much productivity is being lost to the effects of multitasking.

Bob mentions that in the above Peter Drucker’s quote use of the word “concentration” could easily be the same as “not multi-tasking.” So Peter effectively says not multi-tasking “is the key to economic results.” In other words, if you are going to do one thing right in terms of generating economic results, make that one thing be focus! It leads to an interesting expression: If you focus on focusing then you will achieve better results.

Generally people ignore the worst impact of multitasking but in reality the penalty is very high as shown in the graph below mentioned by Bob. As per the graph, 20% penalty gets increased for each item added to multitask.

Sketch graph with actual data

Carol Deeb, Real-estate investor and Business Owner mentioned how businesses and the economy suffer when employees are constantly interrupted with unnecessary distractions, in her article on Bad Effects of Multitasking. She mentioned that The New York Times cites a 2007 study by Basex, a consultation company that studied how employees perform their tasks in conjunction with the use of electronics and concluded following results:

Basex estimated that businesses lose $650 billion a year related to the lack of job performance and creativity due to distractions. When employees lose their concentration on assignments and on finding solutions that help a company reach its financial goals, profits can suffer.

Realization, provider of Flow-based Planning and Execution solutions, released a report on The Effects of Multitasking on Organizations, which reveals that organizational multitasking, a problem that typically goes unnoticed within large companies, annually costs the global economy more than $450 billion in lost productivity.

Bob suggested that we should present the waste productivity in dollars to senior management to grab their attention and encourage them to avoid multi-tasking.

Realization's report cites Flow-based Project Management as the solution to improve organizational productivity and focuses tightly on attacking the biggest cause of lost productivity and organizational multitasking. This method involves following three steps:

  1. Reduce the number of open projects or work streams by 25 to 50 percent.
  2. Establish a clear rule for task-level priorities.
  3. Do not start a project without adequate preparation.

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