Optimization vs Improvement

By Taylor Milner and Kyle Bowman

Optimization isn’t going to deliver the step changes you need; only improvement will.

Optimization and improvement are very different activities.  Optimization is about playing within the known constraints as best one can.  Improvement, on the other hand, is about breaking through these constraints to reach a much higher level of performance. The United States did not put people in space by optimizing the airplane; we built an entirely new industry that took us to the moon.

Let’s use a case of bottled water as an example to further highlight the differences. If you think back a number of years, a case of bottled water came in a sturdy cardboard tray with sides. Over time, the sides went away and then the cardboard liner got thinner and thinner. These are great examples of optimization - small changes that make marginal improvements (in this case they lower raw material usage and cost).

Today, most cases of water don’t have any cardboard liner at all. This is improvement. Could the jump have been made from a tray with sides to no liner at all? Probably, but it likely would have required more work, more resources, and a greater overall change process on the part of the bottled water company. The bottled water companies likely did not feel the urgency to make as significant an improvement in one step (otherwise they would have).

Distinguishing optimization from improvement

As leaders the distinction between optimization and improvement is important because focusing on one or the other will help us achieve different goals.  As in the example above, optimization is great when we need a smaller improvement, and often more quickly.  The more challenging our goals, however, the more we need to steer our people toward improvement and away from optimization.

Optimization and improvement also require different skill sets and therefore different resources.  When hiring or looking to fill a role, distinguishing between optimizers and improvers can mean the difference between success and failure.  Optimizers are great at finding the fine line between tradeoffs.  When I think of optimization, I imagine people working individually, spreadsheets, computer code, and dark rooms that churn out “the answer.”  

Improvers, on the other hand, require the ability to push through constraints, not taking no for an answer, lots of curiosity, asking ‘why’, and almost never being satisfied with the status quo.  Improvers are rarely hidden in the dark room behind a spreadsheet, they are out in the business, making noise and pushing the organization (often uncomfortably).

Slowing down to get more output

As a leader it is also important to recognize when we have optimization marauding as improvement. In these situations, you will likely end up with far less of a step change than you need to achieve.

An example for me is when I hear, “we are going to slow down to get more throughput,” I know that I am seeing optimization marauding as improvement.

Production lines can be run “too fast” causing downtime and quality problems that can be reduced or eliminated at slower speeds.  Therefore, small reductions in speed can result in marginally greater throughput. There is a limit, however, as to how much slowing down you can do before you start to get less out. There is also a limit as to how much of a throughput increase you can achieve by this - usually only a few percentage points.  This is optimization at its best as you are working to find a “sweet spot” between speed and lost time that will give you a small throughput gain.

The challenge with optimization, is that it is a one off.  You can only optimize once, not year after year.  You cannot slow down a little more next year, and the year after, and hope to get more out than you currently are.

Looking at this same situation from an improvement perspective, you see those same downtime and quality problems that occur at higher speeds in a very different light.  They are what you need to eliminate to enable running at those higher speeds.  Solve those problems and you benefit from both the improvement in speed and uptime.  This will be far more output than any optimization will generate and you can repeat it year after year to achieve more.

As in the above scenario, when optimization maraudes as improvement, you might get a small, short term boost, but not the step change that you are looking for.

Signs you are optimizing rather than improving

Here are a couple of telltale signs that your team might be hoping to optimize their way forward when they really need to focus on big improvements.

  • Proposed solutions include tweaking, working a little harder, and small changes vs the wholesale elimination of problems and steps

  • Proposed solutions require fixing many small easy problems vs tackling the one or two big hard ones

  • You hear your team talk about how they need to accept certain constraints and tradeoffs vs seeing their excitement when they figure out how to break them

  • Words they use: optimize vs improve, tweak vs major change, work around vs eliminate,

People often talk about optimization and improvement as if they are interchangeable, but they are very different activities and deliver very different results.  As a leader, this distinction is important to recognize because only improvement will deliver step changes to the performance of your organization.

 

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