Here’s the American Dictionary’s definition of the Law of Diminishing Returns: “The tendency for a continuing application of effort or skill toward a particular project or goal to decline in effectiveness after a certain level of result has been achieved.”

Ok… in my words it means that you can achieve a certain level with a certain amount of effort, and that after a certain point, it’s almost wasted effort. That’s difficult for people to swallow, for a lot of reasons. But, that is what real efficiency is all about.

Let’s talk about this… it’s at the heart of taking control of your life. The basic reality of life is that we have limited time. We need to weigh how much time and effort is worth a goal. It’s like determining how much money something is worth. Obviously if you have limitless money you can buy anything you want. If you have limitless time you can try to achieve anything you want.

Did you ever see the movie GROUNDHOG DAY? Bill Murray keeps reliving the same day over and over. After a while, he realizes that he can learn a lot of skills because he has limitless time… so he learns piano, ice sculpting, languages, etc – because it’s like he has limitless money – he has limitless time.

Well, we don’t have that luxury of limitless time. Being a boss is tricky because employees need to maximize their time… you need to give them enough freedom to use their time wisely, and hope that they won’t take advantage of you and misuse their freedom.

I’ve learned that good employees respond well to freedom – that they flourish with the opportunity to manage their time. Lousy employees take advantage of freedom and misuse their time. I prefer to let bad employees hang themselves.

This philosophy of mine flies in the face of too many bosses, coaches, cultures, etc.

Micro-management loves to point out the little problems… they always miss the big picture and the main point. Their nit-picking leads to poor leadership – leaders who are afraid to loosen the reins for fear that any minor problem will be used against them… so it all becomes management by ‘cover your ass.’

Years ago I had a young Assistant Pro who hit balls 40 hours a week at the range and gave very complicated lessons. I tried to explain to him my theory of the maintenance free golf swing… people don’t have 40 hours a week to work on their golf swing. He didn’t even sort of get what I was talking about, but years later he sent me an email that he teaches the maintenance free golf swing… wow! Stuff like that gives me hope.

I have to wrap this up… people need freedom to manage their time. Sounds obvious, but when bosses, family, etc. expect perfection we don’t have enough time to live and to be well-rounded, but the more we live in a specialized, perfectionist society the more we’ll have serious human personality problems. Business has to realize that those problems are not efficient, that they’re crazy insistence on control is actually not cost-effective. Look at the problems that the military is having with suicide. All of this comes down to a lack of freedom and a lack of understanding the Law of Diminishing Returns.