Spending Review

A blog such as this is no place for political comment, but here’s an observation…

A major part of the recent government spending review and austerity measures has revolved around efficiency.  This is almost inevitable at a time when action is required to cut a record deficit, and the coalition sits in fine balance between providing good news to the voting masses, and risking double dip recession.  It would be too tempting (and perhaps unwise) to pass up the opportunity to swing an axe in the direction of inefficiency, after all, it allows the new regime to score points off the old (“what were they thinking”) while simultaneously having some positive numbers to talk about.

But, clucks John Humphries, the sums you’re talking about are minuscule against the scale of the task at hand.  Even then, your numbers seem optimistic and these are one time savings, we need long term solutions.  All may be true, but nevertheless, however many £billions it turns out to save, these are surely the most efficiently gained £billions the spending review will have to offer.  They are right to seize them immediately, right to trumpet the success of the saving, perhaps even to shame the government they inherited the inefficiencies from.

And there lies the lesson to us all.  Let’s not forget when we are against the ropes that before we embark on a daring project to triple our sales volumes or shrink headcount by 20%, let’s first take time to look again for the waste that can be cut, the things we can that no one will miss.

Here’s an anecdote to demonstrate the point.  Many moons ago we were working as part of the Operational Research division of British Airways.  There was a large scale project underway to identify and cut day-to-day inefficiencies and save costs.  There were some big wins coming from the project, but one of the most obvious came from someone outside of the analytic community, a member of the ground crew.  His proposition was simple, “why don’t we stop buying tax discs for the vehicles that are on the runway?”.  He observed that these vehicles (used for driving luggage around, refueling aircraft, etc…) were never driven on a public carriageway, and yet, all carried tax discs.

I truly doubt whether any amount of applied analytical thinking from the Operational Research community would have identified that opportunity.  Sometimes all you have to do is open your eyes.