Monthly Archives: September 2011

Germans have a love affair with efficiency. Things in this country are under continuous scrutiny and society strives for efficient improvement. Governments, companies and even single consumers are looking for efficient ways to organize administration, debt, work, costs or life.

In the past this approach has largely contributed to post-war German success. Shortly after the devastations of WW2, Germany diligently reorganized. Old and crusted structures were replaced by new and modern measures – be it governmental, economic or socio structural.

Economic growth, raising profits, social change and worldwide reputation were the results leading to a real frenzy about more and more efficiency in more and more parts of life.

You will surely agree that efficiency is related to “doing the things right” and thus making them somewhat better. One could thus draw the simple conclusion that more efficiency is better than less. And it is this simple but wrong assumption that has somewhat tricked Germany. Things have changed in the continuous tuning of the well-oiled “Deutschland AG” (Germany Inc.).

Due to “over-efficiency” more and more products and services are working worse than before. Here are some examples:

State-owned companies (Deutsche Post/DHL, Deutsche Telekom, Deutsche Bahn) have been privatized and made “efficient”. Post offices, communication hubs and train stations were closed, investment and maintenance were reduced, employees were given the sack etc. Thus, finding a post office, phone box or train station in German cities or high-speed internet in rural neighborhoods has become a dream. Using worn out infrastructure becomes a pain and in the winter of 2010 the Berlin commuting rail system due to cost cuts had less trains up and running than in the summer of 1945 (yes, less trains than 1945!).

All these examples are systems that have reached a tipping point where a more of efficiency (e.g. in the form of value engineering) delivers negative utility and everybody is worse off.

Considering Germany a role model for inefficient economies in Europe is therefore at least problematic. In other words – who are we to tell others what to do? The German approach to efficiency works like repairs on a machine. Imagine a screw that is being tightened. At some point the screw is tight and thus it makes no sense trying to continue turning the screw. If done so a screw that is perfectly tight will suddenly loosen again, resulting into a ruined screw thread.

And that is when things start falling apart.

Think about it…