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Friday, May 11, 2012

The Precious Resource

      Management 101 defines the manager’s job with stark simplicity: to get the highest possible value in the shortest possible time at the lowest possible cost . . . for the longest possible period of time.
Nothing to it. Just get out your calculator and organize an efficient investment of resources, then implement, monitor, adjust.
If it were that simple, of course, there would be no need for expensive managers. Just resources, planners and monitors. Here’s how it would work:
At its simplest, the list of resources is a short one:




                  EVERYTHING ELSE (Facilities, materials, etc.)

Time is the most rigid of the resources.
Everybody has the same amount of it. It just ticks away, one second at a time, sixty seconds per minute, sixty minutes per hour.
Einstein theorized that time becomes flexible as one nears the speed of light, but since few of us work at that rate, Einsteinian time is not an issue.
In reality, time is a great tool for measuring the investment of the other resources against results, and that’s it. It is a tool for making value decisions, but otherwise contributes nothing. A deadline’s value is in what a person or group can accomplish by a given moment. The people action is what’s important.

Money is the universal resource.
Everything can be converted into a cost. If you have enough money, you can buy whatever you can absorb of any other resource.
The People resource, for example, can be calculated in terms of “fully loaded labor cost.” That means a person’s salary and fringes plus the person’s proportionate share of cost of the organization’s common amenities: the building, insurance, air conditioning, marketing, etc.
If everyone in a company were of exactly the same value to the organization, you could divide its total cost of operation for a week by the number of employes. That would tell you how much each employe was costing the company, and therefore how much value that worker should provide for the company to break even on employing that person.
Things aren’t that simple in the workplace, but you get the idea. Money makes everything else possible, but has no intrinsic value of its own.

Let’s skip to Everything Else.
Here you can have construction materials, computer databases, office furniture, whatever. None of it does anything but sit there (costing money and probably deteriorating) without the wise use of it by human beings.
Information can be vitally important, in a Project or other activity, but only if it is known, understood and properly employed by people.
The “everything else” category is the one that, in general, can be replaced or substituted for by other resources. For example, if you have enough time you can swing an old-fashioned hammer instead of using an air-operated nailer. If you have enough money you can buy more raw materials.

The People resource is the central and most meaningful of the resources. Without it, the other resources have no meaning. They don’t do anything.
Under weak management, the people involved in getting things done are seen as the “adapter” in the scheme of things When you run out of time, make people donate time by working extra hours. Withhold overtime, and you save money, too.
If the Project suddenly hits an unexpected problem or picks up some added requirements, you can’t afford to bust the budget or miss the deadline – so you push the people harder.
In a properly planned Project or other activity, the human resource is not an adapter. The people who staff the Project have been carefully “estimated” to fit the requirements by devoting reasonable time to the effort. The result has been defined, and all the resources – including the human one – have been organized to get it done. Again in simple terms, the overall “investment” can be represented in a formula:

      Time + $$$ + Everything Else x Human Effort = Outcome

                                          T + $ + E x H = O

Time is added, along with Money and Everything Else. The role of Human Effort is that of a catalytic multiplier employing the other resources to achieve the planned Outcome.
If something happens, say the deadline is suddenly moved up to hit a window of opportunity in the marketplace, something has been subtracted from the T.
Logic – or good management – says O will be proportionately reduced, unless a sufficient increase is made in one of the other elements on the lefthand side of the equation.
Instead, what frequently happens is a greater burden is placed on the less-measurable human resource. Can’t you hear it now? “Let’s just take a few of these people sitting around drinking coffee and get another few minutes of work a day out of each of them.” Bingo! Problem solved.
You do that a few times – and it can work over the short term if the people care about the organization and believe in the Project – and you wear the human resource down. Its productivity declines. People get tired and uninspired. You miss the deadline (time), run over budget (money) and still have a poorer result (Outcome).

 So the substitution of human effort for other resources is of very limited value, and in fact usually is negative.
And, of course, if the enthusiasm was not there to begin with, there was not even a short-term gain.
However, the biggest price paid for such mismanagement is the effect it has on the people. They learn to distrust managers and their plans. They learn to protect themselves. They play the game as survivors, placing no value on courage, commitment or extra effort. You won’t get them back.
In short, you have blown the most precious resource. 

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