All Posts in Policies and Procedures

|In: Industry Commentary|Last Updated:

There’s an old joke about a farmer who loans his mule to a friend. The mule will work hard if treated well, he explains. All you have to do is speak gently and the mule will do what you need it to do.

His friend tries it out, but the mule won’t do anything – it just sits in its stall taking up space and food. When the owner comes back his friend complains that the mule wouldn’t work at all.

Puzzled, the owner picks up a two by four and starts whacking the mule about the head and shoulders.

“I thought all you had to do is to speak gently,” his friend said to him.

“Well sure, but first you have to get its attention,” explained the farmer.

The joke isn’t all that funny, but the punch line can be used in a wide variety of circumstances. It probably explains, for example, the exorbitant estimates bandied about for the Total Cost of Ownership (TCO) of a personal computer. The promoters of these ridiculous estimates are just trying to get your attention.

This is the last of our three-part series on the subject. The column two weeks ago showed that TCO asks the wrong question — TCO adds together part, but not all, of three independent statistics — costs associated with improvements to personal productivity and effectiveness, with improvements in communications, and with the automation of company core processes (that is, development and deployment of production application systems).

Last week’s column focused on the statistic you should care about the most: the fixed overhead costs (Personal Computer Overhead Costs, or PCOC) associated with LAN-attached personal computers. PCOC, it appears, comes to about $3,000 per year.

We’re going to wrap things up this week by looking at the number you may have thought TCO measured: The cost of personal computing. Personal computing is the term we’ll use to cover the use of word processors, electronic spreadsheets, personal information managers and stuff like that — software designed to enhance personal productivity and effectiveness.

It’s tempting to calculate a total cost for this category, but it would be a mistake for two reasons. First, the benefits, while huge, defy quantification. (The proof: PCs have completely transformed the workplace — not one PC-enabled job looks remotely like what equivalent employees did 15 years ago.) Comparing quantitative costs with qualitative benefits can tie your brain into knots.

Just as important, these are variable costs — they go up with usage. Your goal when dealing with variable costs should be to reduce unit cost, not total cost. And the cost we’re interested in isn’t the cost of personal computing itself — it’s the cost of the work supported by personal computing (since that’s where the benefit comes in). Let’s walk through an example.

Figure an average employee gets one day each year of formal training, another full day of support, and loses two full days each year just figuring out how to do stuff. Including the employee’s time and that of support staff at a standard rate of $40/hour (a reasonable fully loaded cost for a $50,000 per year employee), that comes to about $1,600 per year. Allocate a third of the PCOC cost to this category of benefit (the other two thirds goes to the other uses of a PC) and you come to a total annual cost of $2,600 per employee for improved personal productivity and effectiveness.

Let’s figure about half of the employee’s total work — about 1,000 hours per year — is improved through personal computing. That makes the unit cost of personal computing about $2.60 per hour. Expressed as a percentage it comes to an overhead cost of 6.5% of the work affected.

Here’s a wild guess: personal computing leads to improvements in productivity and effectiveness that vastly exceed 6.5%. Reduce your support costs? Sure — so long as it has no deleterious impact on the employees you support.

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|In: Leadership|Last Updated:

Quite a few years ago one of the Jims reporting to me created an innovation called the “Daily Musing”. Each musing was a tidbit, milder than but akin to those that grace the top of this column, that appeared on the user’s screen while logging in.

The Daily Musing became quite popular, and employees inundated Jim with submissions. Having your musing appear became something of a status symbol.

One submission (from the Curmudgeon Calendar) read, “Happiness is seeing your Mother-in-law’s picture on a milk carton.” You can see what’s coming. An employee complained, calling it a “clear case of gender-bashing.”

We tried to save the feature, but after reviewing the situation with Human Resources we concluded it was hopeless. We worked through several examples and found that only by extracting every last bit of wit could we make the musings safe for employee consumption. Even making it optional wouldn’t help.

(I happened to walk past the complainer’s cubicle not too long afterward. In the cubicle next to hers I saw a sign that said, “Grow your own dope – plant men.” Too bad about that gender-bashing thing.)

Another example of Human Resources killing a morale booster? No, HR was just the messenger. Our HR folks did their best to help us preserve our “Daily Musings”.

Two recent columns have painted the HR industry in a less than favorable light, and reader response has been awesome in its volume and passion. Only a handful of readers spotted a key point: HR doesn’t become a bureaucracy unless line managers willingly abdicate responsibility. Many look to HR for protection when they make mistakes. Many more give HR the dirty jobs they don’t want — like giving employees bad news.

Yes, all too often, HR departments act in ways that deserve criticism, and there’s no point in pretending otherwise. Please notice that I said, “All too often,” not “Always” or “Usually”. Human Resources, like all internal support organizations, walks the fine line separating administration from bureaucracy (for a wonderful discussion of this subject, get hold of Larry Miller’s Barbarians to Bureaucrats). It also has something less than a free hand. HR helps implement the desired corporate culture — it doesn’t formulate it.

IS managers rarely offer compliments to HR. I think I know the reason: IS walks the same fine line, and comes over to the dark side easily as often. Yes, young Skywalker, when you take off Darth Vader’s helmet you just may find your own face inside.

Take an hour or so to look in the mirror. How long are your lists of “company standards” and “IS policies”. How flexible are you in interpreting them?

How much effort do you expend explaining your standards and policies? Do you explain them only when you issue them or often and in terms that demonstrate their value to the company and end-users?

When you find an end-user has violated one of your policies, do you just enforce the policy or do you take time to explain why it exists and is important? And when you’re done explaining (or better, before you start) do you ask why the employee violated the policy in the first place?

Have you ever said the equivalent of, “We won’t do it for you, we won’t give you the tools to do it yourself, and we won’t let you buy the tools either, because after you build it you may ask us to take over support”?

Did you write the e-mail policy that says the system can only be used for business purposes and that violations will be noted in the employee’s records?

The key questions to answer to find out if you’ve joined the Borg collective: Do a lot of your policies, procedures and standards exist for your own convenience? Borg! Is your first instinct when faced with an issue to draft another one and add it to the book? Borg again! Have you ever reviewed your policies and procedures to figure out which ones you can eliminate? Congratulations! You’re still human.

Human Resources has to deal with executive style, employment law, and union contracts. Accounting has to conform to both Generally Accepted Accounting Principles and the tax code.

What’s your excuse?

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