Saturday, April 14, 2012

The Futility of Tracking Individuals Time

An inordinate amount of economic resources are spent on managing people's time. Professional Services, IT, Design Agencies are typical examples of organizations that ask their staff to track every task they do, the type of the ask, the client the task was for, etc., all down to the hour, or minute, depending on where you work.

The rational for doing this seem perfectly reasonable, even if the outcomes do not.

Chiefly, business owners want to know if they are charging the right price for services rendered to clients. The need to track effort is a primary objective. Supposedly this helps managers optimize efficiency.

Tracking time is also cited as a way to prevent abuse at work. Time management is supposed to protect workers from being forced to work unreasonable hours. It is also is touted as a way to keep workers honest, preventing them from spending to much time googling, or facebooking, or other kinds of goofing off.

While the objectives are rational, the ability of management to ignore the obvious dysfunctions of time management is not.

Whenever time tracking is used to prevent abuse, falsification of data is the result.

Project Managers will prevent workers from tracking after hours work if it affects their budget, regardless of exhortations from senior leadership. This is especially true in professional service and consulting firms.

Workers will also enter time according to the expectations of their management, implicit or otherwise. No one wants to be flagged as a bad performer.

Even when discounting abuse, time entry is notoriously inaccurate, most workers have trouble remembering exactly what they did down to the hour for an entire week. Again, time gets entered according to management expectation, rather than reality.

The really insidious aspect of time management is that it is measuring the wrong thing. It emphasizes an inward perspective where cost is king.

Success in a customer experience economy requires an external perspective, one focused on getting a handle on the creation of customer value.

On first look, this is a more involved exercise than tracking individuals time.

Measuring customer value requires a deeper understanding of the types of goods and services you offer to your customer. This allows you to look at metrics like throughput, the time it takes to create customer value, and how often you deliver value without incurring customer complaints.

These are the metrics that matter to your customer, not the exact time spent by every FTE. Cost can still be measured, but by approximation, which is more than good enough for most situations.

Simply take the total burn rate to produce a product or service and divide it by the throughput. Effort across multiple services gets amortized across the portfolio.

- Posted using BlogPress from my iPad

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