Underpromising and overdelivering, not such a good idea

Posted on January 23, 2009

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Back in December, after the horrid experience I had with the local power company, I wrote a post about communicating when all else fails.  In it I discussed a variety of ways in which communication could have been greatly improved.  But, as I was thinking the other day, there was one point that I alluded to that has more relevence in the business world than some of the others.  “Underpromise and overdeliver.”  If you haven’t said it yourself, you’ve probably heard it from someone.

The idea seems ok on the surface.  If I say to you “you’ll have it by Friday” and then I give it to you on Tuesday, how unhappy will you really be?  I mean, after all, you were OK with getting it Friday, so early delivery should make you excited, right?  Wrong!

Let’s return to the ice storm.  The message we were given was “power will be restored by the end of the week.”  There’s something like, who knows, 20,000 people in my town.  So how true is that statement for most people?  In it’s most generous of meanings, that statement is true: you will most likely have power restored by the end of the week.  But, for most people the statement is also false.  In fact, your chances are really good that you will have power well before then.  The act of fixing the power grid is a right skewed curve, like this:

right-skewed-distribution

Why is this interesting?  Well, the morning after the storm, almost nobody has power, but then the crews work immediately on the main lines.  Once they get the main lines back up, power is quickly restored to many people, hence the quick rise in the curve.  Indeed, the pace of recovery is quite quick, perhaps only a day or two for most people.  In reality, 55% of the town had power by the evening of the third day.  And yet, it took almost 12 days for the last people to get power back.  Clearly, the probability that you’d have power back by day X had a very long right tail.  Some people, a very few, were in the cold a long time.  Most of us were not.

Well, so what, you say?  What’s the big deal that the town underpromised 60-70% of their residents and overdelivered?  I’ll tell you what the big deal is.  Money and lots of it!

Every day you are without power you have to make a choice – if I stay here, what are the chances that I’ll get power back?  If the odds aren’t good, well, you make certain financial decisions.  On day two, because the town employees were still saying “end of the week” I went out and spent several hundred on a generator for my home.  Other people spent nights in hotels.  That might be $150 or more a night AND if you didn’t really need the room but you occupy it (i.e. use the resource unnecessarily), then you deny someone else who does need it access to a warm place to sleep.  So, how acceptable would it have been to me if on day two someone told me “end of the week” and then I drove home with the generator, used it for a little on the expectation that I’d need it for several days, and power came on three hours later?  I’d be furious, that’s how I’d feel!  By the way, you can’t return a used generator… stores don’t allow it because they don’t want to become a generator rental company during major outages.  If you spend the money, it’s yours to keep.

Well guess what, as a systems organization, it’s the same deal.  When you underpromise to your customers and then overdeliver, how do you know that they haven’t made an expensive financial decision based on when you said you could deliver it?  Maybe they retained extra staff to do the work manually until you automated the process.  Now they’re paying for people they don’t need.  Maybe they bought extra hardware to cover until you could resolve your performance issues.  Great, now they own hardware that they wouldn’t have otherwise bought.

Sure, underpromising and overdelivering means you’re never late, but that doesn’t mean you’ve done your customer a favor.  Underpromising is as much a lie as overpromising.  PROMISE and DELIVER!

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