Man hours – Why?

For a product development organization, being driven by man-hours as measure for managing its operations,  lends itself to the command and control zone of management. Instead of measuring and tracking how we meet client demand, the focus is shifted on controlling this measure.

This measure leads the organization to judge its performance based on the cost of its people instead of Throughput. Instead of being considered opportunity, people are perceived as liability.  Therefore, Man-hours emphasize on maximizing people utilization.

Man-hours lead to negotiation, which against paying respect to people. I am not sure of the value we have from knowing the man-hours estimate of certain feature? I am not sure how possible this can be done in fair accuracy? Even if we do this correctly, how this can make real difference.

Man-hours discourage thinking on productivity basis and create culture of interfering in the means engineers do development. It promotes measuring people performance based on their utilization instead of the value they bring.

Being driven by man-hours is against organization agility. When developing a feature there is a collective contribution from various skills in a monolithic form. Why we care how many hours each person has spent? For me this is not possible and at best not helpful.

I suggest the PMO establishes measurement program for Lean measures namely Lead Time, WIP and Throughput and stop computing man-hours. Clients are interested in Lead Time, internal cost of production by the product company is of no value for them. Shareholders are interested in profitability in terms of increase in Throughput and reducing the cost per feature. Employees want to achieve life-to-work balance by reducing their work stress through controlling their WIP limit and avoiding having them being over-utilized.

2 thoughts on “Man hours – Why?

  1. This is an excellent and innovative approach for true productivity.
    I agree. This will support innovative thinking and creative ideas, which will turn each employee as valuable source.

    • Thanks Hossam.

      The overheads involved in man-hours tracking is high compared to ROI. What the company delivers is sheer effort of multiple skills. If the mind-set becomes shifted towards feature delivery, then, unit of planning and management is a feature instead of man-hours. Feature can have associated ROI which make it more meaningful to various stakeholders.

      I found operations management and their PMOs are extremely obsessed by man-hours and slack, instead of focusing on client-demand and our abilities in terms of Throughput and Cycle Time.


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