Are people your most valuable resource?

Christer Idhammar
Tags: talent management

“People are our most valuable resource” is most probably the correct political statement to make, but is this true? I do not think it is not true and in this article I will explain why I think so.

 

In his book “Good to Great”, Jim Collins talks about having the right people on the bus before you start a journey toward excellence. Those of you who have read his book will recognize some of my reasoning here.

 

During the last five months, I have asked front-line leaders in maintenance organizations all over the world – including Australia, New Zealand, Canada, the United States, Sweden and the United Kingdom – the following question: “How many of the people reporting to you could you send home to never come back without seeing a difference in your team’s performance?” The answer is between 10 and 30 percent! And, comments like “It would be a great relief and a morale- and performance-booster if I could do that” are common.

 

The right people
So, the statement “People are our most valuable resource” cannot be right. Therefore, I suggest it should be changed to “The right people are our greatest resource.” The wrong people are not an asset; they are a liability. This example is about front-line people and if the same rough statistics are true also for management, it has worse consequences. The higher up in the organization you have the wrong people, the more damage they can do.

 

The best do more and more

What happens in many organizations with the wrong people in the front line is that the best performers will do more and more and the lowest performers will do less and less. As a front-line leader, it is more convenient for me to assign the people who I know will do the job well and without any complaining than to assign the less-willing and/or less-skilled people to do a job. This will result in that the best performers will not only do more work, but they will also become more and more skilled and the opposite will happen with the lower performers. This is also a typical phenomenon in so-called self-governed teams. Some individuals will not take on the same workload as the rest of the team and the top performers are driven by pride in what they deliver.

 

The right people in the wrong position

Four years ago, a maintenance organization I recently worked with had taken away all maintenance supervision and formed so-called “self-governed” teams. The replacement for the supervisor and planner roles became the responsibility of a rotating maintenance contact person for each team. The responsibility was rotated on a monthly basis. Research has found that 97 percent of people are followers and only 3 percent are good leaders. If this is true, it means that the contact person role is the responsibility of the wrong person 97 percent of the time. This also proved to be the fact. The self-governed teams had become very reactive and ineffective, so now this organization had to face this fact and reinstitute the positions of front-line leaders.

 

I believe it is true that, in organizations with many wrong people, 70 percent of the work is done by 30 percent of the people.

 

So if you have many wrong people, how do you change this? In most cases, you can not do anything in the very short term such as laying people off or moving them somewhere else. Instead, you look at ratios of attrition and start hiring people on other criteria more than you might have done in the past. For example, set a higher value on attitudes and aptitudes than skills or the fact that they just happen to live close by or their father worked in your plant.

 

If this is not an acceptable timeframe for change and the situation is really bad, you will probably soon start talking about more desperate actions such as outsourcing of the entire maintenance organization.


Torbjörn (Tor) Idhammar is partner and vice president of reliability and maintenance management consultants for IDCON Inc. His primary responsibilities include training and implementation support for preventive maintenance/essential care and condition monitoring, planning and scheduling, spare parts management, and root cause problem elimination. He is the author of “Condition Monitoring Standards” (volumes 1 through 3). He earned a BS in industrial engineering from North Carolina State University and an MS in mechanical engineering from Lund University (Sweden). Contact Tor at 800-849-2041 or e-mail info@idcon.com.
Management Consultants in Reliability and Maintenance – IDCON
www.idcon.com


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