Minimum Effective Dose

If a company is in a bad shape, the employees are, too. With or without severance, it is preferable to be employed than to be looking for a new job. So if finances are in the red, addressing that is the best way to serve your employees. Some sacrifices are justified when pursuing that cause. In difficult times, the best leaders manage to fairly share that burden between management and employees.

What separates good leadership from bad leadership, more often than not, is what happens after you’re done struggling. When you’re in the black, with a bit to spare for investment on growth.

It’s wise to invest in infrastructure, yes – marketing, technology, research and development – but also in people. 

Good companies understand that people are more productive when they don’t have to decide between fresh groceries, or canned goods and taking the kids to the movies. Companies like that understand that there’s no point investing in marketing if employees are working on stone-age computers, and it makes little sense to buy cutting edge hardware and software if the employees don’t have proper training.

Mediocre companies do a different kind of math. They think: “The less I spend on my employees, the more I can spend on infrastructure. So what’s the least money I can invest on people and still get the required productivity?”

That line of thinking has a name in medicine. It’s called “Minimum  Effective Dose” – the minimum amount of medicine that can be administered to fight disease. In medicine, this is justified because most medicines have unwanted side effects, which a conscientious physician will strive to minimize. Meanwhile, investing in people runs no such danger.

Do you treat your employees as if they are a pillar of your company, or as if they are a disease?