Thanks to its success, many businesses today are considering working under the Agile philosophy, which stresses the value of process efficiency. However, they face a major stumbling block: the choice between resource efficiency and flow efficiency. This dilemma can be chalked down to how they see the system of work.
Analyzing Resource Efficiency vs Flow Efficiency
In resource efficiency, organizational work flow moves from one individual to another. This picture, however, fails to indicate the presence of workflow delays. What this means is that an individual, and no one else within the organization, can carry out their tasks. As you move up the employee hierarchy, you find that senior or specialized employees need to do the work, making others less capable of performing the tasks. In resource efficiency, tasks are optimized for individuals.
On the other hand, flow efficiency places responsibility for processes and tasks in the hands of teams, making it possible for a team to specialize in a particular feature area. If one person needs to take time off or go on vacation for any reason, the team remains operational without that single individual. Although the team might be a bit slower as a result, it still works.
In a nutshell, resource efficiency is individual-based optimization, while flow efficiency is about optimizing for processes, tasks or features.
The Effect on People
If an organization optimizes for resource efficiency, there are always people with open, unfinished tasks. The more work that remains unfinished, the longer the queue of work grows. Despite working hard all day, they do not feel like they have accomplished anything since nothing gets done.
Conversely, when optimizing for flow efficiency, members of a team finish tasks together and have less work in progress. The team members experience a sense of accomplishment since they can see what they have been able to complete.
This idea is in line with the adage Many hands make light work.’ The goal of flow efficiency is for people to help each other to move a task to completion.
Management of Performance
Performance management is carried out in different ways, depending on whether resource efficiency or flow efficiency is applied. Some of the ways in which performance can be managed include:
- Asking for results
- Asking individuals to team up to complete tasks
- Setting up practice communities to help people hone their skills and learn their craft
- Showing team members how they can offer feedback to each other
Performance management is a system function. In the case of resource efficiency, it is necessary for someone to check in on what other people are doing, to prevent bottlenecks. However, if you use flow efficiency to focus on features instead of individuals, there is minimal performance management required.
When it comes to accountability, many managers want to know:
How can I tell if everyone is doing their jobs?
How can I tell if they are letting other people do their jobs?
Are people learning how to do their jobs?
The answers to these questions come from the team. Every member of the team is aware of who is working hard and who is slacking. The team is also aware of how members are learning and if anyone is stuck.
When people within the organization add time into their estimates to build documentation that the team finds useful, members of the team pressure each other to deliver on the documented tasks. In addition, the team will know who does and who doesn’t deliver on documentation. Whenever the team completes its work, the project owner determines whether any backlog adds value or if they cannot afford to put any more money into the project.
In flow efficiency, accountability for tasks is team-based, not individual-focused. The team is accountable for completing processes, knowing the progress of work in progress, letting the process owner understand how long tasks will take to complete, and the value of each feature of the product or service.