The reason why I am writing this article is an observation of mine around some office environments where working more is considered better than working efficiently. I tried to understand this phenomenon. From Lean perspective it is always flow what matters much , but, why still people insist on resource efficiency ? What are the things from real life making this hard to focus on flow efficiency ?
Then it come to my realization that not everything is easy to adopt when it comes to capitalism aspect of life. Here in this article I try to go through ingredients of this mind set and understand the background of it.
When you pay money for something, you naturally want to make sure that you get exactly what you have paid for. So, in shop you make sure that product is checked before handed, or, you typically have buyer protection clauses for online shopping. All of those arrangements are there to make sure that there is fair trade practice. In short, trust, which is critical for us to come back again and do shopping again. Buyer gives out hardly earned money and receives goods or services under terms that are agreed upon.
Situation changes dramatically when it comes when you hire a person to do a job. Basically hiring means that you pay money to get specific task done. You cannot do it yourself, since you are limited in time and you do not have those skills. So you pay for labor. Still it is easy , as in task like wall painting, there is measurement criteria of wall is space. Or if you hire a person to translate a document, there is evident outcome and this can be fairly measured.
Complication comes into the scene when there are additional variables coming into the space :
- Role includes creative elements
- Role includes pull based activities which are not in control
- Role required mobility and transportation cannot be predicted
- Role is interlinked with other people outside of organization
- Company has many processes and every employee participate in several of them at the same time
- More than 3 levels of management.
- and other.
If your role has some of characteristics mentioned upper then you are probably hard case when it comes to evaluate your real value for company. Even it is hard to decide whether company needs you or not. This is very hard question for managers to deal with. I have seen several cases how in different companies people are being pushed to keep them busy, since this is only obvious and seemingly observable state for manager to have clue on your added value.
If you have a boss who constantly keeps you busy by making sure that you have constant backlog of tasks to finish , then probably you are in the environment of resource efficiency focus. It is called Busy Bee paradox, since, it shows exactly opposite when you look closer.
Little’s Law
This paradox states that when you have employee working all the time, at first it seems like they accomplish more, but, in reality it is part of downward spiral. Since, focusing on individual instead of flow definitely creates waiting lists on people desks (since not everyone works at the same speed within process) and you keep increasing WIP (Work in Progress). If you are familiar with Littles Law, the more you have WIP more your process takes time. So, Lead time directly related to WIP.
So Littles Law states that :
Lead time = WIP * Cycle time
Lead time - Average time it takes for your process from order to delivery
WIP - Work in progress. Average works which were started but has not yet been delivered.
Cycle time - time between two successful deliveries
So, Little’s law states that if you want to be fast to your customers you have 2 choices. Being fast means lower lead times. Low lead time means that when your customer wants something it gets it quick. 2 choices are :
- Decrease WIP.
- Decrease Cycle time.
Now let’s see those actions in real life when we are focused on resource efficiency. Everyone in bellow process focuses in their own task and produce as much as possible finished stuff on their desk. (This is required by their boss – “keep working!”). So more they work more WIP they create. More WIP is created higher the Lead time.
If we compare this to the roads. Imagine a highway where traffic accident happened and pass through decreased 80% . There is a traffic police just at entrance to the highway. This police keeps sending cars into this highway, since, his success is counted not by successful car passage to another city but no traffic at HIS part of the road. This is what happens in real life. People are pushed to do more at their desks while not making effort to make a connected process.
Business people love to increase utilization of their assets to increase revenue. It is always working scheme when it comes to assets. Like, if a company has a car which is not working in evernings, they can rent it and get additional revenues.
But it is not always true when it comes to people. Even, it makes opposite effect. More people work, more WIP they create and longer the lead times are getting
But what is the solution ?
Flow Efficiency
When we talk about flow efficiency we are thinking about customer. Only about customer. Isn’t it the most critical for us ? At the end of the day, how many products we have delivered to our customers. This is our measurement criteria. So, let’s zoom out and describe it.
At this point we do not talk about individuals. We are talking about teams. This is also common concept in Lean Six Sigma as well as Agile thinking. Stop thinking about individual delivery but focus on team delivery.
This means that companies should define exact number of processes and people in each process. Then to make sure that when request comes in it goes through it at maximum speed possible. This is the way of efficient teams.
Final remarks
Is the resource efficiency wrong idea? Should we forget about our employees ? How much they work or does not work?
No, If you have employee and you pay salary , you have to make sure that you are getting maximum from him/her, but focusing on his busyness is not the way to go.
Here are the steps:
- Focus on flow. Make sure that processes are defined, steps are well described and people are ready to work as teams, not as individuals.
- Make sure that process does not face delays between employees and WIP is decreased.
- AND only now, think about resource efficiency. How to utilize excess time of employees while not hurting the process flow.
If you would like to discuss this with me, please write me on twitter – @imranbaghirov .
I’ll be happy to discuss and collaborate on this subject.