The Merits of Time Reporting: Managing the Human Supply Chain

There is something vaguely disconcerting about that title, isn't there? It conjures up nagging visions of Soylent Green, conveyors full of people, and shelves lined with dormant staff just waiting to be activated. Just don't forget to remove that little desiccant packet…

I am routinely asked to make a case to reluctant knowledge worker executives about why time reporting is such a critical element to effectively managing their direct staff and workload. I suspect their hesitancy stems from some Orwellian stigma attached to the approach, or concerns of a staff revolt if they are asked to active role in eroding their own presumed workplace privacy and independence. If these concerns take on phobic proportions, time reporting sometimes gets labeled as Too Big of a Culture Change so it can be summarily set aside — pending unceremonious disposal in the future (sans witnesses). Like leftovers, perfectly good but unappealing ideas must be properly aged before being tossed out to avoid a fit of wasteful guilt.

Not so fast there — not if I can help it, anyway. Besides, I like leftovers.

I want to share an approach that I employ when arguing the merits (necessity) of time reporting by knowledge worker staff. It is difficult to dismiss in terms of logic. Of course, that doesn't mean it won't still be ignored as an inconvenient truth, but the concepts are sound and universally understood.

Whether manufacturing widgets or providing a consumable such as electricity, everyone can readily accept the intrinsic business reasoning for carefully managing the raw material employed. Cost effectiveness dictates a keen awareness of quantities on hand, how it's being utilized, and doing everything you reasonably can to identify and minimize production waste.

For example, power plants are constantly tuned to ensure that they produce as much energy as possible with a minimum of emissions from the fuel used. As you might imagine, accomplishing this requires a number of key parameters to be monitored throughout the process. Similarly, a manufacturing line ensures that parts are carefully laid out to maximize the number that can be cut from a single sheet of material and minimize waste.

The point is, regardless of the type of operations or the nature of the material used, it only makes sense to carefully measure and monitor your stock and how it is utilized, especially if the material in question is very expensive and limited in quantity. Production plans make assumptions about how much material you think will be needed in order to achieve a given result, which is then compared to actual parameters such as overall production volume, cost per unit, etc. Obviously, any variance between the two is crucial to understand in order to make adjustments and achieve optimum results.

OK, with that basic concept firmly in hand, let's turn attention to modern knowledge worker environments — IT, engineering, marketing, R&D, whatever. By definition, the primary raw material engaged in this situation is people — specifically, their time and effort. Doesn't it stand to reason that efficient operation mandates that a mechanism be in place to not only estimate the effort needed to achieve results, but also carefully measure actual usage? Without those two critical data elements, it is nearly impossible to establish accountability, identify inefficiencies and thus effect improvements to maximize production.

I know of no better, more effective way of tracking where the time and effort is spent at a sufficient level of granularity other than time reporting. While headcount is fine for gross inventory purposes, it does nothing to reflect actual utilization and efficiency compared to your capacity plan.

The second part of the argument is associated with defining the mechanism for how work progress will be measured so that plans can be updated and monitored. There are two fundamental approaches to doing that — you can either directly measure results or outputs, or you can measure the consumption of material used versus the total needed.

When building a brick wall or filling boxes with widgets, it is easy enough to directly measure results at any given point and reflect it as a percentage of the overall objective. While also knowing the time and material consumed is certainly useful information, at the end of the day the wall is half done or the order is half full, regardless of what was consumed to get you there.

The status of most in-progress knowledge work is much more difficult to directly measure in objective terms. The first issue is the ephemeral nature of the work process itself; it is flawed logic to assume that a presentation is half done by the number of slides created, or to estimate the progress of a computer program from the lines of code written. Second is the variable nature of just how much raw material is needed. It is relatively straightforward to judge how many bricks are required to build a wall or widgets needed fill a pallet. However, creating accurate initial estimates of the time and effort necessary to produce a knowledge-based deliverable gets decidedly more dubious. Time reporting assists with this issue by providing a mechanism to further refine effort estimates as work progresses.

But, the real clincher is, if you are not going to employ effort estimates and time reporting as your measure of progress, then what alternative are you going to use? What information will you collect, and how will you do it? In lieu of planned effort compared to how much was applied, you are left with trying to estimate the percentage of completion based on estimated progress towards a result. Knowledge-based products involve with a lot of intangible elements along the way to arrive at a tangible result, so finding a stable reference point from which to make a progress assessment is a real issue. Now for sure, effort reporting on knowledge work is not going to produce the same level of precision as measuring walls or widgets, but it is likely much more accurate and consistent than a subjective percentage number tossed out by the manager (who has a vested interest in appearing on time and budget).

Administrative and logistical considerations, such as how you will gather percent complete estimates, who will give them, and creating a consistent mechanism to get them all at the same time further complicate the option. Processes and techniques can be clumsy to the point they are never provide reliable information. The result is that organization is unable to effectively utilize and manage is most precious, costly commodity — its raw material — its people.

If you really take the time to properly analyze and think through the implications and mechanisms for alternatives, time reporting starts to be recognized as the much more appropriate, efficient and elegant approach that it is.

Finally, despite all the gnashing of teeth and wringing of hands over perceived cultural roadblocks to instituting time reporting, our experience with hundreds of organizations is that the actual shift to employing this process is quite often much less of a leap than first imagined, particularly when the basis for it is properly communicated and expectations are clear. Remember the sense of doubt and trepidation with your first venture up the diving board ladder? Now compare that to the exhilaration of surfacing after the dive, looking back up and thinking, that was actually pretty easy and fun! Such is the cool clear water of time reporting.

I would unscientifically and conservatively put odds of success at about 30:1, simply because I'm at a loss to recall a single deployment that failed where time reporting implementation was the primary reason. Hey, there are plenty of other challenges that have a higher likelihood of spoiling your parade — time reporting is probably not the big dark cloud. In fact, the complications of NOT doing it is a much higher risk to achieving objectives and success.

So, if you are a proponent of time reporting as the best method of establishing resource-centric work controls in your organization and are facing resistance, arm yourself with this line of reasoning as a compelling argument — then just dive on in; the water is fine.