Lower Utilization to Reduce Variability
November 12th, 2002 by HalI've been writing about variability and uncertainty for the last few days. Someone asked, "What do we do when we are already busy? We'd like to improve but we don't seem to have the time for it." It just so happens the same group manages the project staff to virtually 100% utilization. They do it by seeing that everyone has more than one thing to do. The reasoning is understandable. So much of what we work on in projects is not ready for completion. People are expected to do what they can, then go on to another task. All the while, they keep their utilization high. This is a usual condition, particularly in engineering organizations and professional services firms.
High utilization is not equivalent to high productivity. Managers fail to realize the cost of the repeated de-mobilizations and re-mobilizations of work. Not only is that mobilizing time a pure waste, but for knowledge work and creative work the performer has fallen out of flow. The quality of the work has to suffer. Managers also fail to see they can do something about the exact issue they are responding to. They can set out to make work ready.
Ready work can be promised reliably. Ready work can be performed uninterrupted. Ready work completes on a predictable basis releasing work for others in the same predictable way. Ready work is simply more rewarding for the performers. It is a principal responsibility of the project manager and the planning system to make work ready.
The Last Planner™ System of Production Control is an approach for planning and preparing the work of the project team. In doing so, a principal source of variation — planned work in an unready state — is minimized. Oh, but we (the project team) don't have the time (capacity) for making work ready. What a shame. Stop what you are doing! Adopt the rule: only begin tasks that are in a condition for completion. Watch productivity soar!
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November 19th, 2002 at 6:39 pm
One reader recently noticed that the highest profitability on his firm’s construction projects was at a time when utilization was the lowest, 68%. Their target since that time has been 80%. Project profits haven’t been close to what they were during that time.
Anyone else notice that pattern
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