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Is people your most valuable resource?

by Christer Idhammar

“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 towards 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, USA, Sweden and 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%! 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” can not be right so I suggest it should be changed to “The right people is our greatest resource”. The wrong people are not an asset it is a liability. This example is about front line people and if the same rough statistics is 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 frontline 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 then 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 work load 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 supervisors and planners 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% of people are followers and only 3% are good leaders. If this is true it means that the contact person role is the responsibility of the wrong person 97% of the time. This also proved to be the fact. The self governed teams had become very reactive and ineffective, so now this organization faces this fact and reinstitute the positions of front line leaders.

I believe it is true that in organizations with many wrong people 70% of the work is done by 30% 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 lying people of or moving them somewhere else. Instead you look at ratios of attrition and start hiring people on other criteria then you might have done in the past. For example set a higher value on attitudes and aptitudes then 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 most probably soon start talking about more desperate actions such as outsourcing of the entire maintenance organization.