2002

Many organisations are wasting 25% capacity through poor resource management - 27 May 2002

Managing staff effectively is key to profitability. In times of growth, organisations are perpetually short of resources. In recession, organisations cannot afford the resource they are carrying. So making the most effective use of resources available is always top of the agenda.

However resource management is becoming more and more complex. The mix of people and work is evolving. There is a growing need to develop 'technical specialists' and project working is becoming an increasing part of business as usual activity. Research from PA Consulting Group shows that many organisations are wasting 25% capacity because management disciplines haven't evolved to recognise that managers now need to support this more complex mix of work and people.

Gareth Firth, a member of PA's management group comments:

"Many organisations are not even aware of their wasted resource capacity. However the rewards from effective resource management are significant. As a result, staff are used as efficiently as possible, even where work patterns fluctuate. Scarce resource is used optimally and staff are retained and effectively developed."

Through PA's work with Infraco JNP Limited (one of the three companies formed as part of the Public-Private Partnership of London's underground system) £7.1m was gained as a result of improving resource management. PA was able to withdraw from the team when implementation disciplines had been proven, and the JNP team members and divisional managers have continued to deliver valuable improvements to performance.

Andie Harper, Managing Director of Infraco JNP Limited states:

"From my perspective it [the project] has provided a base of control from which real benefit can be driven, which could lead to engineers doing fee-earning engineering, not chasing paper around. It also proved that given aspirational targets, teams can make things happen and change. Important aspects were the high-level focus on the objective and a robust team approach from PA."

PA's experience has shown that 5 key steps can be taken to manage resources better and give tangible results and payback rapidly:

• Work out what it is worth to you: Investigate, quantify and measure the business impact of poor resource management

• Find the compelling evidence: Create the local imperative to do something differently and quickly. Often the simplest things can make the biggest difference. For example during planning make sure that open-ended commitments are avoided and then ensure that the plan is followed.

• Break down the barriers: Separate perception from reality and deal with prejudice

• Fix some of the problems quickly to demonstrate the benefits: Pilot a bottom up approach to diagnosing the real problems in specific groups that pose a bottleneck today and propose solutions that fix the underlying cause. For example, for a major European telecommunications company, we established a series of pilot resource groups with between 10 and 50 people and demonstrated practical improvements within 10 weeks.

• Scale up and tackle the problems more widely: Build the commitment to support the wider implementation challenge. From a pilot group, analyse what aspects of resource management have worked best and determine how to exploit the concepts elsewhere in the organisation. Those involved in the pilots can then be used to lead by example.

-ends-

For more information, please contact:

Chantal de Havilland PA Consulting Group 123 Buckingham Palace Road London SW1W 9SR Tel: +44 20 7333 5277 Fax: +44 20 7333 5329 E-mail: chantal.de.havilland@paconsulting.com

Notes to editors

1. A copy of the case study 'Infraco JNP Limited - Improving commercial performance' is also available. N.B. Please do not contact Infraco JNP Limited before contacting us first.

2. PA has also helped the following companies achieve more by improving resource management:
(Case studies are available on request)

• Major European telco: Demonstrated that poor resource management was costing in excess of €150m (£100m) per annum.
• Engineering Consultancy: Reduced operating costs by 23% without loss of performance
• Major European electronics firm: Identified 20% wasted capacity in the project organisation
• Technology R&D organisation: Increased reliability of project delivery from 56% to over 90% in two years and halved support resources
• Major retail bank: Reduced HR budgets by over £8 million pa through a less costly, more responsive and agile organisation offering a new set of business capabilities
• Broadcaster: Reduced cost of production from twice that of independents and enhanced visibility of production pipeline
• Engineering contractor: Discovered that the organisation had been turning away work despite 15% spare capacity.

3. PA Consulting Group is a leading management, systems and technology consulting firm, with a unique combination of these capabilities. Established almost 60 years ago, and operating world-wide from over 40 offices in more than 20 countries, PA draws on the knowledge and experience of around 4,000 people, whose skills span the initial generation of ideas and insights all the way through to detailed implementation.

PA builds strategies for the creation and capture of shareholder and customer value, and helps clients accelerate business growth through innovation and the application of technology. PA works with clients to improve performance, mobilize human resources and deliver change effectively, including managing major projects, and designing and implementing enterprise-wide systems and full e-business solutions.

PA focuses on creating benefits for clients rather than merely proposing them, and this focus is supported by an outstanding implementation track record in every major industry and for governments around the world. PA also develops leading-edge technology both for its clients and within its own portfolio of venture companies in areas ranging from software to wireless technology to life sciences.

PA distinguishes itself from its competitors through the range and quality of its people, the depth of its industry insight, its development and use of technology, and also its independence and culture of respect, collaboration and flexibility in working with clients.

We are proud that our clients say "PA makes it happen".

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