Does utilization matter?
Most recently I was watching a talk on Kanban. The speakers
gave an introduction of the Kanban method and then evaluated Kanban in
different respects. One thing they considered to be a disadvantage was that Kanban
causes utilization of people to go down. Once again I felt puzzled. The same
happens in almost every training class I teach: People ask how we measure
utilization with Kanban and how we we can make sure that people are always
fully utilized.
My standard answer to this is: „Is it really important if
people are utilized? If we deliver as much value for our customers as quickly
as possible, why should we care about utilization?“
Kanban and utilization
Kanban does not
try to maximize utilization (although my impression is that people sometimes try to abuse
it for this purpose). The opposite is true! In Kanban we are aware of the fact
that high utilization cloaks our system which leads to longer lead times and
poor flexibility. And even worse: If everybody is fully utilized, we do not
create slack in our system which means that we will not improve! Yes, I’m sure that there is
no Kaizen without slack. This is why I use this quote by David Anderson quite a
lot: „Slack is the ultimate weapon!“
In a WIP-limited pull-system we will always create slack –
because of variation and due to the fact that there will always be a bottleneck
in our system which affects upstream and downstream processes. My experience is
that this is the moment of truth: When teams new to Kanban first face the
situation of people having slack. What will the people do with this slack
capacity: Will they use it for system improvements and for helping their
colleagues? Or will they ignore the limits and start working on a new ticket?
And how will the management react? Will they trust people that they will do the
right thing and support them in improving the system? Or will they fall back
into the push model and assign new tasks to people?
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Everybody is fully utilized. But is this what really
matters?
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Utilization as a proxy
Even though most people agree that there is not much value
in utilizing people, I think there is a real need that causes people to use utilization as a metric. In my opinion
people use utilization as a proxy for something else. They want wo know about
the productivity of their team or department, and they want to know if their
plan is in danger. And they have a lot of pressure to get things done. So some
of them use utilization as a replenishment mechanism: As soon as utilization
goes down they think it’s the right moment to assign new tasks to people.
Do you know this old joke?
A drunk creeps under a street lamp. A policemen approaches
him and asks: „What are you doing?“ The drunk answers: „I’m looking for my keys,
must have lost them.“ Policemen: „Did you loose them here?“ Drunk: „No, I’ve
lost them somewhere down the street. But here it’s brighter.“
Instead of measuring things that really matter (customer
satisfaction, lead times for valuable features, employee satisfaction etc.) we
measure things that are easy to measure. This not only leads to dysfunctional
behavior (e.g. people doing a lot of useless stuff in order to keep utilization
high) but also obscures real problems and improvement opportunities.
Utilization of tickets
Having said that, perhaps there is another approach to this.
If people are used to utilization and are not ready to let go utilization, we
could (as a first step) change the scope of utilization: Instead of utilizing people, we
should focus on value-added tickets to be utilized. As soon as we work on
maximizing utilization of tickets we will tackle wait times and blockers. And
this is definitely a good thing to do!
Thanks to Stefan Roock, Henning Wolf and Sebastian Keller
for discussing this topic with me!
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Like this post? Then you should check out my post Keep the Ball Rollin´ which deals with the difference between resource efficiency and flow efficiency.
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Like this post? Then you should check out my post Keep the Ball Rollin´ which deals with the difference between resource efficiency and flow efficiency.
