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Process Improvement Goes Back to the Basics for Many…

March 18th, 2011 2 comments

Process Improvement BasicsThe last few years have witnessed big changes in the business climate, and continuous improvement (CI) efforts have certainly seen their share of change. I talk with companies every day and, without a doubt, there has been a fundamental shift in thought on how to best make meaningful process improvement happen.

Prior to 2008, there was significant interest and buy-in for large-scale, top-down initiatives. There was a willingness to set aside large budgets and free up significant resources for the CI initiative.

Training increasingly large segments of the workforce was front and center. Detailed, multi-year plans were put in place. The CI initiative was heavily promoted, internally and externally, and employees were strongly urged to participate.

But, did those big initiatives deliver results? Undoubtedly some did. But, many more, when you really check the numbers, did not. There are many distinct causes why they didn’t work, and I won’t try to dive into that here. But, with the meltdown in the business climate, many leaders took a look in the rear view mirror and didn’t like what they saw …. big dollars and resources consumed with little evidence of concrete results.

Now, does this mean that CI and process improvement is useless and should be abandoned? Of course not. Businesses live and die today based on the strength and adaptiveness of their processes, as compared to their competitors. Does it mean that the tools and methodologies used (Lean, Six Sigma, BPM, etc) are not good and should be replaced with something new? I think not. The tools and methodologies can certainly be improved and expanded (and are), but they are proven to work.

So what’s happened? I believe that, for a lot of companies, there was too much focus on the initiative and not nearly enough focus on results. And based on conversations I have with business leaders every day, I think many have drawn the same conclusion.

So, when smart people see the error in their ways, it typically leads to change. The change that I’ve seen happen for CI is a move back to the basics, and a focus on bottomline, business results. It may return, but for now I see very little interest in big change initiatives whose results are measured over the very long term, if ever truly measured. I see a much more tactical view of CI, focusing on solving specific business problems quickly, as opposed to general quality improvement. CI programs are more likely to be looked at from a bottom-up or grass-roots perspective.

Smart leaders are now letting the specific needs of their business drive what the CI program looks like, what methodologies and tools are applied, how results get measured, what technology platforms are deployed, etc. To borrow from Lean, the business is pulling CI capability, as opposed to it being pushed into the business. In the real world, what does this mean?

Download our executive brief that outlines the basics of Lean a short executive brief that provides a good overview of the basics of lean

Well, I can only give you my perspective from talking with leaders at companies of all sizes and in many different domains, but what I see is a clear move back to the basics of business and process improvement. Basic quality and process tools as employed in Business Process Management (BPM), Lean, and basic quality tools (Yellow Belt) are getting a second look.

Why? Because, for many businesses, the basics will help solve 95% of the real business problems, get results fast, and they can be introduced into the organization for a very low cost and very low risk. The basics also build a solid foundation on which advanced capabilities like Six Sigma and DFSS can be effectively built and deployed to deliver even more dramatic business results, with much less risk.

So, what do you think? Is this just a reaction to circumstances and will large-scale, top down change initiatives return. OR, is this the new normal for companies when it comes to business and process improvement? Feel free to Contact me if you’d like to discuss.

Business Process Management (BPM) = Robust Project Pipelines after the Low-Hanging Fruit is Harvested

March 10th, 2011 1 comment

BPM and Improvement Project selectionSo, what does Business Process Management (BPM) mean to you if your organization has already gone headstrong into lean,  six sigma or other improvement efforts?    What does it mean to you if the efforts have really produced some good results?  Think you don’t need it and should move on?   You may want to think again ….

I constantly talk with people and hear some variation of ….

“We got a lot of great results from our program (Lean, Six Sigma, Quality, CI, etc) for the first couple years, everyone was excited and motivated, but now the program seems to be running out of steam.  Results and participation are falling, interest in waning, and we can’t figure out why”.

There are, of course, many potential causes for this, but one of them seems to be pretty consistent.  There is no real project pipeline and project prioritization approach. What happens?  People don’t really know what to work on so they don’t do anything or, maybe worse, they start working on squeaky wheel projects that have little or no impact on the business, and may even have a negative impact.  If this happens, I can assure you that it is a recipe for disaster for any business improvement program.

Download our whitepaper that discusses using BPM and scorecards to align improvement efforts Download our whitepaper that discusses using BPM and scorecards to align improvement efforts

If you build that BPM framework, you will have a clear view of what really matters to the business and metrics to gauge your success in improving those things.  A pipeline of business cases and projects can be built based on measurable performance gaps and those projects will, by definition, have clear line of sight to things that really matter.  A clear prioritization scheme then keeps things practical and real.

If you have a clear list of projects that are absolutely aligned with the things that matter most to the business and you have a way to prioritize improvement efforts, do you think an improvement program is likely to fizzle?   I think not.

So, give BPM a second look, even if you’re well into an improvement program.  It doesn’t have to be a complicated, drawn out task.  If you’re just getting started, you can and should build it in stages, while you’re picking up some of those low hanging fruit projects.   If you have a mature effort, you can still build it in manageable stages by prioritizing the different areas of the business.  In the medium to long run, it might be the difference between your improvement program being a flavor of the month initiative and a long-term, strategic value-add component of the way you do business.

Contact me if you’d like to discuss BPM and your organization in more detail.

VOC and Lean Value Stream Mapping – A Simple, but Powerful Equation

March 2nd, 2011 Comments off

It sounds so simple. Lean eliminates waste defined as any activity that does not provide value to the customer. Eliminate the waste and you will bring products and services to customers better, faster and at a lower price. Finally, combine it with Six Sigma to reduce variation and defects, and you make breakthrough results.

We all start by understanding that value is defined solely by what the customer actually desires and for which they are willing to pay and that value enabling activities, while not adding direct value, are necessary. We all then look for the true non-value added activities that add waste in the form of unnecessary time, effort or cost. We learn to seek and eliminate those non-value added activities. That is the essence of a lean project.

So what is the lynchpin that makes this elegant equation work? Identify what your customer considers of value and how you deliver it. Once you have that line of site, if you maintain efforts to continually improve, you’ll get there. But without that clarity, your improvement efforts are a march to nowhere.

It is important when developing that line of sight to define value from the perspective of the customer, the Voice of the Customer (VOC). Understand clearly and exactly what product or service the customer desires, when it is to be

delivered, and at what price.

Download a VOC training module dealing with Critical to Customer Requirements, a key element of VOC

Download a training module dealing with Critical to Customer Requirements, a key element of VOC

To understand how your company actually delivers what the customer considers of value, leverage lean tools to precisely map the set and sequence of all specific actions done to bring the product or service from conception to final delivery. This provides a visual display of exactly how a particular process is carried out. Mapping this “value stream” enables you to identify value-adding and non-value adding activities from the customer’s perspective thus setting the stage for improvement.

Along with providing a sense of alignment between your goal of delivering value and your opportunity for improvement, this exercise also carries the message of how problems and solutions are cross-functional in nature. If process owners participate in this process with an open mind, they will learn the futility of looking for a solution from someone else independent of their efforts. Thus, not only does value stream mapping provide alignment from the customer to performance improvement opportunities, but it continues through to an individual’s actions.

Yes it can be a simple equation – understand what your customer values (VOC), eliminate waste (Lean) and be more competitive. But to do that, make sure you get the front end right using VOC and value stream mapping to get the target and alignment to individual actions.

Feel free to contact me if you’d like to discuss ….