Managing human capital

Managing people is hard enough, but when your people are split across many projects it can be downright impossible without the right approach. David Braue finds out why proactive human capital management has become critical to future business success.

It's 9:00 am. Do you know where your team members are?

This might have been a silly question years ago, but times are changing -- and project management with them. Employees with software development, helpdesk support, and project management teams are all crucial to the successful rollout of information systems, but a historical lack of interconnectedness has made it difficult for executives to know what individual employees are actually up to at any given time.

This is because team members may be in their offices or kilometres away at customer or partner sites. And this, in turn, can make the ongoing management of information projects extremely difficult: like any project, successfully turning an IT-driven business initiative into reality requires the involvement of a broad range of skilled people at different times. Without a clear view of skilled workers and updated information as to when and for how long they're going to be available, it can be difficult for high-level executives to plan overall corporate strategies.

Such issues come to the fore in larger organisations, where many projects may be running simultaneously. They're also common after mergers, acquisitions, and strategic restructuring such as that that recently happened at Woodside Energy. There, an expansion in corporate direction saw the company's IT services arm separated from the core business into a new company called Adesi Solutions, which maintained its role as a provider of IT services (largely around SAP R/3) to Woodside but also generating new business by servicing external customers.

With four other major customers apart from Woodside, managers at the new company were finding it difficult to know which staff were committed to which projects, at which time. With up to 80 different processes running at once and employees forced to use different systems for change requests, billing, time recording, and other functions, co-ordinating between them became nigh unto impossible. Adesi eventually resolved this problem by implementing Mercury IT Governance Suite, providing those functions and more in a multi-project environment that has improved project visibility and helped managers regain control over their runaway business.

"We have a lot of resource sharing between projects and one person could be working on five projects at once," says Adesi consultant Wesley Franke. "We've created different business rules for all our clients, and can drive service requests through any defined processes we want to create. Because everything is in the one system and we have a single source of information, we've been able to standardise all of our processes across the different teams."

Backing the service guarantee
Major changes in organisational structure force managers to reconsider how things are done, but effective human resource management can fall through the cracks as management focus sticks on more conventional bottom-line financial performance and efficiency strategy.

There's little margin for error when people are expected to be jumping from one project to another with alarming regularity.
While it may be prudent to ensuring the businesses come together, such an approach is anathema to the requirements of a far-sighted business. Without the right people available at the right time, even the smallest strategic project can stumble or completely fall down. Yet with many project managers still focused on managing just one project at a time -- often through the use of simple Microsoft Excel spreadsheets or Project charts -- many lack the tools and broad thinking necessary to successfully extend the company in new directions.

This presents a major problem for companies eager to improve service, in an age where agreements between business units are increasingly governed by formal or informal service-level expectations. If a framework for better people management isn't put in place from the get-go, it can be difficult to engineer into the business later on.

The implications of such a shortcoming are significant: there's little margin for error when people are expected to be jumping from one project to another with alarming regularity. Miss a step, and the whole project can be delayed or thrown off altogether -- and this can have knock-on effects that damage other efforts. Commit to a project whose execution requires a particular staff member to be in two places at once, and someone is going to end up disappointed. Worse, it could put you into defensive mode and threaten your reputation.

Clearly, the solution to this problem requires the ability to forecast project requirements well into the future -- but most companies lack this kind of long-term visibility. Managers looking to bring consistency to their resource management systems need perspective on the change they're introducing -- something that's often possible by wrapping program management into overarching service frameworks such as ITIL (IT Infrastructure Library) or its derivatives, such as the Microsoft Operations Framework (MOF).

"Our industry is very dynamic, and you know you're going to learn technology today that is not going to be relevant in three to four years' time," says Microsoft Solutions consultant Gary Roos. "You need to keep people motivated, educated, and relevant, which is why workforce management is one of the key areas addressed in MOF."

The need to smoothly handle multi-project co-ordination was a core precept in the work of the UK-based Program Management Group (PMG), whose downloadable Program Management Maturity Model (PMMM) questionnaire guides companies through the process of improving their overall resource management.

PMG breaks the process into seven key stages: planning each project; transmitting project plans to a central point; consolidating many project plans into a single program plan; evaluating inter-project conflicts and identifying over-demands; experimenting with alternative strategies to optimise the workload schedule; disseminating strategic decisions back to individual project teams; and evaluating performance through a feedback measuring system.

Expanding on ERP
Simply knowing that there are enough people available to handle a project is only half the challenge, it's also equally important to make sure that they're the right people. You might have a hundred Visual Basic programmers available, but if a project requires Perl scripting expertise you're going to be up a creek. Increasingly specialised information workers aren't interchangeable; they have so many different skills, developed to so many different levels, and those skills are changing so quickly, that it's hard to keep up, much less anticipate future skills demand.

To get the whole picture, it's necessary to tie project management systems in with broader human capital management (HCM) platforms, which handle human aspects of the company such as development of individuals' skill sets. Enterprise resource planning (ERP) systems typically include human resources management modules, but their capabilities are usually limited to the more factual issues and stumble when confronted with intangibles such as knowledge and capability. HCM, created as extensions to the administrative features found within ERP systems, provides a more consistent view of employee training, education, skills, and other critical attributes.

"ERP was designed to make the recording of transactions very efficient, but when it comes to using information it's absolutely hopeless," says Michael Coveney, director of business services with services giant Geac. "ERP is focused on what you've done, but that isn't really an indicator of what's going to happen in the future."

These measures depend on operationally relevant information about the company's production processes and both its human and business assets. When combined with HCM capabilities, staff planning should properly be viewed with the same sort of importance given to conventional demand planning and forecasting. This will allow you to become become more proactive about your project scheduling, ensuring you know what skills are required and when -- and which people are going to be available to provide those skills.

For example, if your analysis can show that you're going to need five Linux experts for projects that will be running in 12 months' time and you will only have two available, now -- when you're committing to the project -- is a good time to start hiring or training some other people who may be free at that time. Because people are such a considerable expense for any business, better visibility of staff plans can also improve the budgeting process.

The long-term human view
Given the right management approach, project resources and staff capabilities will take their rightful place as essential elements of the business information ecosystem. But simply putting them there isn't enough -- to both allocate resources better in the future, it's also critical to implement feedback mechanisms that are able to measure project performance against defined measures of success. You're not sure how to measure success? Then you've got a problem. "When there's a whole series of projects, you have to assign assets and, even more importantly, at the end you must be able to measure whether you did what you said you were going to do," says Coveney. "This requires breaking down strategic plans into measures of success, implementation and measures of resources for those activities."

It's not enough to just say that a particular stage of a project was completed; it may have been completed late, improperly, or by people whose skills were only a partial fit for the job at hand. Any of these issues could easily have impacted the customer's perception of the company -- potentially endangering the opportunity for follow-up work or strong references down the track.

You probably already have regular appraisal techniques for judging staff performance, but they're likely to be generic measures that are hard to apply to projects. To resolve this issue, tailor performance metrics to the requirements of a particular project, then use appropriate systems to track both individuals' performance and customer satisfaction.

Such metrics feed into the overall picture of how the business is running -- and should be reflected in high-level business performance monitoring systems that gauge the overall performance of the company. Even if a project ends up being managed sub-optimally, careful management of human capital can provide invaluable guidance for the future, ensuring that service levels are met and constant improvement remains the name of the game.

This article was first published in Technology & Business magazine.
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