Nix Resource Allocation

I often get asked, “How can we improve Resource Allocation?”  My first question is “you mean people, right?” Calling people resources is a topic for another day, but for now, I’ll ask that you consider the impact of language on your culture, and start referring to them as 'people'.  The second question is “what are you solving for?”

When organizations optimize efficiency by making sure people are busy, they end up with a lot of work inventory.  Work inventory refers to partially done work that cannot realize financial gain (either cost savings or revenue).  Work inventory has significant holding cost.  Partially done work has to be stored, reviewed, documented as well as being queued up and prioritized for the next person who adds to it.  

Consider alternatively focusing on work allocation, instead of resource allocation.  Agile people refer to this as “watch the baton not the runners.”  In other words, make sure that work is moving and getting completed, instead of watching that people are busy.  Think about the cost of a person vs the value of the work. Assuming you have a viable business, the people you pay for the work make far less than the cost of the product.  It logically follows that you want to focus on getting your product out the door before you maximize your people’s time. I’m not saying that you shouldn’t do both, but I am saying that if you compare ROI you’ll likely focus on the product or service.

How do people know what to work on?  Resource allocation becomes a matter of assigning people to teams, and keeping the teams stable.  They stay on their teams indefinitely. Teams have a prioritized backlog or worklog.  This drastically simplifies the effort that went into traditional resource allocation.  And honestly, how accurate were these allocations? Did anyone ever check?

The Team can figure out how to allocate work by self-organizing.   The picture shows how much simpler it is when you only manage teams and priorities.


How do I know everyone is busy?  You don’t.  Let it go. People having slack time is a good thing.  They can now learn and jump on new opportunities, innovate.  If your fear is that they will play volleyball all day, rest assured, the team won’t achieve their outcomes and they will vote the volleyball player off the team.  Make sure the team has a mechanism to shed unproductive team members, and problems will be self-correcting.

Then what do managers do?  In many organizations, a large part of a manager’s job is doling out assignments and managing resource allocation.  Managers worry that if lose this responsibility they will be out of a job. Agile Managers shift from managing tasks to removing impediments.  What is blocking the team from working more effectively? Is working moving or is it stuck? Agile Managers work to change those things, and their outcomes are incredible!

How does resource allocation work in your organization? Let us know!