It's been a recurring theme for me in recent years - the idea that we (humans) are naturally programmed to look for transaction cost optimization that naturally leads to large batch sizes and "waterfall" thinking.
This year like any other year, we spend many an evening in December working on our Christmas card list. The first task is to update the information. The data is perishable. People move. Relationships change. Names change. People we haven't heard from for years get dropped from the list and new names added. My wife and I have lived around the World in the past 15 years. Between us, we've managed to live in Oxford, Toronto, Hong Kong, Singapore, Dublin, Dallas (Tx), Overland Park (Kansas), and Seattle, besides our native Scotland and Japan. We've picked up a lot of friends and colleagues with whom we keep in touch mostly just that one time a year.
It is interesting to compare my process against my wife's. After gathering an updated list, together with a set of cards, a set of photos of the kids, and stamps, I dutifully write a single card, address the envelope, insert the photo, seal the envelope and stamp it for sending. On a single sitting I might write 10 cards. Cards seldom depart without a personalized hand-written note inside. It's an effort. I manage to find the energy about two nights per week. My cards are sent off in batches of about 10, perhaps twice a week, starting in early December. I concentrate on the overseas ones and those that require the most detailed notes first. My wife has the same labor input and same quality of finish but she first addresses all the envelopes, then she writes every single card, then she adds the photos, then she stamps them and finally sends them in one single batch. Her large batch of cards is dispatched towards the 3rd week in December with some doubt as to whether the longer traveled cards will make it before Christmas. The saving grace being that few of the recipients are from a Christian tradition and hence they have a tolerance to receive the cards before or around New Year rather than Dec. 25th.
My wife's "efficiency" driven preference - you have to know her and her focus on economics ;-) - leads to a pure "waterfall" large batch transfer system with all the value delivered in one large batch at the end, and additional risk of late delivery to some of our friends. My iterative, flow of value approach, gets some cards on their way as early as the first week in December. Risk is mitigated. However, it is possible that my iterative small batch size approach does involve more energy expenditure. Regardless, all my cards made it to their destinations before December 25th. And had I run out of energy mid-Month (my job at Microsoft has been busy recently and the commute long and tiresome) then at least half my list (those furthest away and generally my more important family and old friends) would have received their cards.
Is my approach counter-intuitive? Or is the large batch size, more efficient (batch size over transaction cost) approach the natural way for the human race?
