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The well-established law of business known as Pareto's rule tells us that 20% of the work gives rise to 80% of the costs.  Typically this part of the work is the part least susceptible to automation.  In other words, your bit.  What happens when your company realizes that most of its costs are on salaries such as yours?

But no, you may say - people such as myself are the life-blood of the organization.  My employer would not be so foolish as to dispense with the valuable work carried out by highly-skilled individuals such as myself.

It would be nice to think so.  However, despite the BPR fiasco of the 1990s when exactly this kind of thing did happen on a large scale, the current trend towards outsourcing of everything possible is leading to what will probably be an equally disastrous re-run.  Perhaps you will be one of the lucky ones who gets to come back on an inflated consultant's rate when the dust has settled!  Perhaps you won't.  But it would make a lot more sense for everyone concerned to deal with things more thoughtfully this time round.

The underlying problem here is actually very simple.  People even at a senior level in organizations have a poor understanding of what it is that their staff actually do.  They form a simplistic concept of what their staff are up to, and then think: if this is all there is to it, why not get someone on the other side of the world to do it cheaper?

The perspective underpinning such decisions is that work can be defined as a series of tasks.  This task-oriented outlook arises from traditional management tools such as work breakdown structures in project planning, and is supported by mainstream technologies such as workflow and BPM.  In such approaches:

1. Work is divided up into tasks
2. These task units are assumed to capture what is done.

This is fair enough when the work consists of assembling cars on a production line, or matching bank statements to receivables.  However, the approach breaks down completely when it comes to what I call human-driven work - the sort of collaborative, adaptive, knowledge-based work that you and your colleagues do.

Treating work as task-oriented is equivalent to viewing it from the outside - as a detached observer, individual tasks are all that you see.  However, this is completely inadequate for human-driven work, which must be understood from the inside.  Your own work is not about tasks at all.  It is about things such as information, interaction and innovation - much of which is almost invisible to an observer.  Only by understanding work from the inside can you make valid judgements about it - such as how genuinely to do it better.

TAKE AWAY

How far down the outsourcing route is your organization already?  Where will it stop?

Even though ignorance of the true value of human-driven work was the direct cause of large-scale losses during the BPR fad of the early 1990s, it is all happening again.  In fact, those most concerned about it are the outsourcing companies themselves - the suppliers, not the customers.  They may be making a packet at the moment, but know there is huge trouble ahead when their clients start to realize what they have let themselves in for.

So, in an effort to stave off the coming backlash, the outsourcers are actually in the vanguard of efforts to better understand human work.  Many of them are already looking to the techniques of Human Interaction Management to get a better handle on what highly-skilled people actually do.

However, ultimately it is the responsibility of each organization to get properly to grips with what they want to outsource, and how.  The old notion of "core" processes has been discredited for a long time, with Hewlett-Packard outsourcing printer design, and banks everywhere outsourcing financial transaction handling.  So when will you come to understand what the highly-skilled people in your organization contribute - before or after it makes them (quite possibly including you) redundant?

Posted by keithhb in Business Process Management • Internet • Management |Digg This|Add to del.icio.us