First, they ignore a big chunk of the work being done in an organization because while all projects are work, not all work is a project. In most organizations, work is organized not only around projects but also around other business objects or functions. For example, there is work on products, work on customers, work on public sector grants, and work organized by job function (like internal audits). While this work is not project work, managers still need to be able to understand the work in terms of the resources it consumes, the results it delivers, and how it aligns with the organization’s goals and objectives. Understanding this type of non-project work is to understand how much effort and cost is needed to get a product out the door, the factors that contribute to customer profitability, or the total cost to serve customers. You have to be able to define and manage non-project work.
The second major hole in the traditional project-oriented approach is people. The project management approach looks at work as projects, tasks, and milestones, while the ERP approach looks at work as an accumulation of project costs. Missing is the understanding of the relationship between work and the people who do the job—including the ability to staff work. What is the “bill of talent and skills” necessary to get the job done? How can we capture the human resources consumed by work and understand who is working on the most important initiatives? What are the best (most expensive?) people in the organization working on now? This lack of insight has a significant impact at the work level and also weakens the impact of overall organizational alignment.
There is a strong trend in HR software to document and align the goals and objectives of the firm, cascading them from the highest reaches of the enterprise down though the organizational hierarchy to the individual worker. Not that there is anything wrong with this approach, but it results in a classic “last mile” problem as it is currently practiced. Specifically, the goals and objectives do not connect to the actual work being done, leaving the performance evaluation of both the worker and the organization to subjective review rather than practical measurable achievement. As a lifelong “finance guy,” I don’t pretend to understand the intricacies of performance reviews. However, it does seem to me that a performance management “solution” that is not grounded in the measurable outcomes of actual work is more of an employee review generator than a performance management tool.
“Who here works?” It’s an ingenious and efficient question that gets straight to the heart of management and the crucial interplay between people, skills, and work. I am very much looking forward to talking with that prospect again to see if adding the concept of work to the enterprise model, as we have recently done at Workday, has delivered the answer to his question. If the question has been answered—and I expect it has—are the results providing significant improvement in visibility and business alignment? I hope it will go a long way to helping the prospect and his colleagues run a successful business.