Qualtec's Business Performance Improvement Blog

Verizon Wireless “Can you hear me now?” commercials hit home because in our increasingly mobile connected lives we live that moment so many times. Verizon’s implicit message is that not only will you be heard on their network but that they hear you.  We all want to be heard and we are frustrated when ignored.

We live that moment when we question whether we are being heard in many other ways including as consumers and business customers.    How often do we feel as if we are asking the people from whom we buy goods and services both personally and professionally “Can you hear me now?”  How often do we feel as if we are ignored, misunderstood or altogether treated like a dropped call!  What do we do when we feel that way?  I know what I do.  I move to another network.  I move to one that will listen to me.

Let’s now reverse the question.  As a product or service provider, ow well do we listen?  Are we so busy with what we wish to accomplish that we are forget our goal in business, which is to meet client or customer requirements.  I recently heard an individual involved in a performance improvement program discussing the need for Voice of the Customer, VOC, as he explained his management scorecard and projects.  When asked if he’d reviewed either with a major customer, he replied that they’d given him a scorecard but he’d neither used it or presented his because his system was still immature.  I took a double-take.  He’d been handed the VOC he sought but failed to realize it as such as he was focused on his ability to execute.  Tell me – would a hunter increase the amount of venison he had for the winter if he could shoot straight but couldn’t find his quarry?  I think he’d have a cold, hungry winter. Good VOC helps your business see the target.

a short training module that discusses Critical to Customer Requirements

If you want to judge the ability to execute, we have lots of qualitative observations and quantitative measures with which to make an assessment.  Do you have the same so as to assess your ability to listen?   Do you know whether or not you are really listening to the voice of the customer?  We feel that just as there is a maturity model for the ability to execute improvement, there is a maturity model for the ability to listen.  If you’d like to hear more and discuss how you listen to your customer, please contact me.  We always like to listen to you.

Over the past 20 years of experience, we’ve learned the key to sustaining performance improvement gains rests on process management.  This role is entrusted to a broad group of employees who are often the process owners and, when not the process owners, are still the most affected by large scale improvements.  Providing them the proper skills forms a critical component of a robust quality management system.

Some have dubbed this person and the required skills Yellow Belt but that term hasn’t done the role justice.  Yellow Belts are often thought of as data collectors or Black Belt assistants.  But a Yellow Belt’s ability to control and manage processes using metrics and data as well as solve problems using basic quality tools gives them far more impact.  Their power doesn’t come from their place in a tiered pecking order of Master Black Belt, Black Belt and Green Belt but in their numbers, demographics, foundational skills and role.

our executive brief that discusses how Yellow Belts play a crucial role in sustaining process improvement efforts

Yellow Belt training introduces the majority of individual contributors to the concepts of process improvement and management and their position in their organizations make a direct connection to improvement efforts.  Yellow Belt training can be fit to how people will be expected to operate.  If positioned to assist Black Belts, they have little need for project selection or analytical tools.  However, if Yellow Belts are expected to sustain gains long after Black Belts have left, a more complete set of tools is required.

Many organizations have active Operational Excellence programs that consistently execute projects through to implementation successfully.  But to make it stick, drive it wide and take care of low hanging fruit, they should look at process management which forms the core of Yellow Belt capability.  If you’d like to see the core concepts covered in Yellow Belt training, contact us or go to our website’s Yellow Belt webpage where you can download complimentary Yellow Belt training materials.

The 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?

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.

So, 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

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.

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 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 ….

Outwit…Outplay…Outlast.  Wow, that says it all doesn’t it?  Reality TV is a kick. Throw a bunch of strangers onto an island and watch them dwindle down based on how well they can play to the desires of a group in a winner-take-all battle. Lots to learn from watching. How well and quickly can a player understand the group’s requirements? How well can they meet those requirements in a highly competitive situation? Each elimination changes the group’s dymanics so the requirements, competition and strategy all have to be adapted continuously and quickly. One slip up and you could be out. How does this relate to Service Industries?

 our critical to customer requirements VOC module

In previous articles, I’ve discussed how business and consumer patterns have gone through massive changes and how understanding the Voice of the Customer is the key to adapting to the new environment. The nascent recovery is providing an opportunity to survive and, for some businesses, to flourish. But the competition is still in the elimination phase and I believe that is very much the case for service businesses of nearly every nature.

It’s important to understand why things are different in services so as not to be lulled by more macroeconomic headlines. Before the crises, manufacturing went through years of driving productivity while services accelerated right up to the edge. The Federal Reserve’s strategy of depreciating the dollar and growing demand in emerging markets has helped the global competitive position and demand for manufacturing products while services are more tied to the domestic economy. Finally, we have a political environment that ramped regulation or restructured entire service industries such as banking and health care. And if that weren’t enough, services are going to be the start-ups of all the unemployed as they require less capital and can use the internet to gather and distribute information, the very essence of a services business, at a very low cost.

Change is not over in service businesses. Like Survivor, listening and adapting quickly to an ever changing customer is still the only protection from elimination. Several key points we consider imperative to driving alignment are:

1. However you capture VOC, keep improving it. We propose a five level maturity model that goes from what you need to simply stay alive to what you need to be innovative.
2. Balance how you respond to VOC with how you respond to other stakeholder demands. We have a checklist of behaviors that will give you the ammunition to point to an imbalance.
3. Segment your VOC. Meeting every item your customer sets out for you will not yield a purchase while some will yield tremendous results. We offer a framework for segmentation.
4. Convert what you hear to something you can measure. To make science out of art we use industry case studies and benchmarking as the best guide.
5. Align process metrics to the chosen customer measures in #4 above. Again, use industry benchmarking and cases to apply knowledge and experience and avoid the alchemy.

Now you are ready to drive change. But there is one more thing. Let’s return to the scenario painted at the start of this article…it’s not enough to just do this. You must do it fast. We are rebounding but demand for services isn’t returning to 2006 levels…at least not until around 2016…and competition is increasing. During that time, businesses will fail, be acquired or be rationalized. But there will also be winners and, like Survivor, they will win big. We urge you to recognize what is coming and act.  Outwit…Outplay…Outlast. 

If any of the pieces above would help you, let me know our thoughts.

With today's lean workforces, outsourcing important process improvement activities to a specialist partner may be the path to results ...

One trend I saw throughout 2010 (and 2009 for that matter) was a intense focus on doing more with less.  Business is picking up substantially for many companies, BUT the willingness to hire certainly has not.   Personally, I think this trend will continue unabated through 2011.  Companies are very lean and have realized very high levels of productivity (and profitability), and are simply unwilling to go back to the old ways of thinking (i.e. “bloated” workforces).  Outsource certain activities to specialist providers, and figure out how to do more with the same resource levels internally.  As I see it, that is the new norm.  And, one of the fundamental ways you do this is by improving processes.   

But, if the workforce is very lean, running at very high levels of utilization and productivity, how then do you find the bandwidth to do meaningful process improvement activities?  A difficult conundrum, without a doubt?  The old approach (if you consider 2-3 years old!) of setting up a formal top-down initiative (i.e. BPM, Six Sigma, Lean), training a large number of people in one or more problem solving methodologies, and then sending off your new process improvement army to fix stuff is simply not feasible for many organizations.  Even if they want to do this, their people are so busy that there is no bandwidth available, and any kind of a training centric approach like this would likely fail. And, hiring to build a dedicated process improvement organization is just not likely.  So, what is to be done? 

our Lean Primer Kit for an overview of Lean and how it can be leveraged to improve results

I would argue that the way to do it is to outsource process improvement activities to a partner that specializes in Process Improvement. This is a standard outsourcing value proposition where, instead of building up an internal CI organization, you establish a strong relationship with a specialist partner, and leverage their products/services on an on-demand, as-needed basis.  Fixed overhead now becomes variable cost.  Done well, it’s actually better in that ANY $’s expended on process improvement with your partner should yield a significant ROI.

Does working with this specialist partner mean that internal resources are completely isolated from process improvement activities?  No, of course it doesn’t.  But their involvement shifts to a subject matter expert role, rather than a process engineer.  Key stakeholders are involved every step of the way, from characterizing the current state of the process, to identifying problem root causes, to solution identification and prioritization, to management and control plans.  BUT, they are involved in a way that doesn’t drag them into the weeds and allows them to stay focused on their day job.   Process improvements get done in an efficient and cost effective way, and day to day business activities don’t suffer.   Not bad …     

Here at Qualtec, we are already seeing this type of shift happen with many of our clients and have adapted our business model and offerings to accommodate.  AND, we are seeing it work, very well.  So, if you have a real business driver for process improvements, but don’t and will not have internal resources to execute, think seriously about and outsourced approach to process improvement activities.  You may be pleasantly surprised with the results.

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

Your company’s or business unit’s results are ticking up. Many of your processes need improvement to deal with the increased activity layered on a rationalized capability. But your pre-recession centralized group was taken away with the tide or one never existed. And your organization is still holding a lid on any personnel additions as it finally enjoys the fruits of painful decisions and remains concerned about the myriad of external factors threatening a nascent recovery. You are left wondering how to unravel Gordian’s Knot. The Alexandrian solution is to build a self-sustaining model that integrates CI into every day activities.

We propose three elements to a self sustaining model which are as follows:

• Find True North. What is it that your organization needs the most? Is your organization looking to solve a customer matter? Must your organization continue to find efficiencies to remain competitive? Whatever it is, find it and stay on it by making it visible and clear to everyone. The reason is simple. Organizations often used a centralized CI program to push improvement efforts. If you find True North, you won’t have to push improvement efforts. They will be pulled.
• Keep it simple. As you look to take on improvement activities, keep the challenges simple. Use basic tools and techniques to knock down the easy barriers and drive a “pay-as-you-go” model that yields traction. Often a centralized improvement group is there to maintain momentum. Our discussion here isn’t against a centralized effort as much as it is against having to wait for one before you can move forward. We’d argue that as successes and improvements yield returns, go back to a funded centralized improvement effort to take on the chronic, cross-functional challenges that require a higher level of expertise, full time devotion, cross functional latitude and can power through momentum killing barriers. But for now, avoid making momentum a challenge.
• Integrate rewards. If you want it to be broad based, make the rewards broad based and commensurate with the effort. Members of centralized groups are motivated to drive improvement because they have skin in the game. They pursue significant improvement, are measured on achieving it and rewarded if they accomplish their goals. Is it any wonder they are focused on improvement? To get broad efforts to yield results, take a broad view of rewarding success. Now we aren’t saying to weight such reward systems such that everyone becomes an improvement professional. The reward should match the effort and return.

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

Every day we talk to people in all functional areas of organizations wrestling with the question of how to move their effectiveness and efficiency forward in the new environment. They see feel the pain and see the potential reward. But they are frustrated that they don’t have a centralized group which to call and ask for help. They feel locked in place unable to move forward.

Our advice is to find a different solution than what you have considered to be “normal” in the past. Let your organization’s mission pull activity. Pursue simple, well targeted improvements that provide their own momentum. Integrate a broad based reward system that recognizes peoples’ accomplishments on a level commensurate with their efforts. Cut the knot! 

If you would like to discuss these ideas, feel free to contact me.

Every company says they want to satisfy their customer. They talk about customer surveys and gathering the Voice of the Customer. They might even have allocated responsibility for collecting and analyzing this information.

But looking past what is being said, how can you tell if your organization is doing the things? How can you tell if you are really there? In essence, let’s define what constitutes a Customer-Driven Enterprise.

our BPM Overview presentation

 In our experience, when we have seen strong performance related to customer relationships, we have observed the following characteristics;

• A focus on process rather than on functions. The reason for this is simple – when you focus on process you focus on resolving the causes of problems and you measure upstream metrics that give early warnings. When you see organizations focused on functions, its usually an indication of the desire to fix or deflect blame. Also, it is when you see a neglect of process that you see lagging indicators such as financial measures dominating attention.
• Employees know and accept their roles in the processes they either own or of which they are a member. In addition to their recognition, you see their incentive systems tied to the customer metrics. Beware of incentive systems solely tied to financial measures. There is no surer way to take your eye off the customer and develop a short term focus.
• Everyone understands how the organization’s processes are operating. People know how things fit. They don’t just look at their process or their role in a process but they begin to understand and relate to how the processes are linked. When people focus on the linkages, there is less white space and fewer hidden processes.
• Processes are measured objectively and measures are reported regularly. In other words, it’s not about the blame and there aren’t any secrets.

If you aren’t there, what do you have to do to achieve that state? Well first there are some prerequisites. An organization needs to bring together all its initiatives under one umbrella responsible for the business’ improvements. Next they need to communicate the seriousness of the need. One of the best ways to do that is to put the customer information in front of the process owners. Too many times the customer data is hidden. People are given just what the organization believes they need to know to do their jobs. The customer data, especially the most unpleasant, which by the way is the most motivating, is locked up so no one knows the bad news…but that just means no one knows the need to change. Finally, leadership must make their commitment. (See Leadership Steps in Becoming a Customer Driven Process Enterprise).

With prerequisites in place, the organization is ready to reorient ifself. Our process is based upon a system where we emphasize (i) Establish, (ii) Deploy, (iii) Implement and (iv) Review. We will get into that four step process in our next Customer Driven Enterprise article. In the meantime, identify if you are a customer driven organization and, if not, set the foundation on which to build. If you would like to discuss, contact me.

As I have said in a number of previous articles, Continuous improvement (CI) seems to be coming back in vogue after a couple of years where CI programs were severely cut back or outright eliminated.  Service and service delivery organizations that paid scant attention to structured business and process improvement are now taking notice.  Why? 

our BPM Overview Presentation

Well, the simple answer is that things are just different now.  I talk to business leaders every day, and I can’t tell you the last time I heard “we want to start a continuous improvement (or Lean or Six Sigma program, etc) to instill a culture of quality and continuous process improvement in the company”. Overwhelmingly, my conversations say it’s all about solving specific business problems, immediately and relatively inexpensively.   And, services and service delivery organizations are who I’m talking to.

Problems seem to cluster around being able to deliver an increasing service level while maintaining or growing margins, WITHOUT adding headcount.   It’s do more with less (or at least with what we have).  My limited insight doesn’t bode well for the near-term employment outlook, but it’s what I see nonetheless.

So, the reasons for doing it are different than they were just 2 years ago.  The way business leaders want to do CI is also different.  There is very little appetite for big dollar corporate initiatives. The focus is almost entirely on quick wins … results now.   Now, the Six Sigma purists out there might say that a focus on near term results is a recipe for disaster.  I don’t think so.  We have to live in the real world, and if some basic infrastructure components are put in place, you can focus on short term wins and still get sustainable results. We (SSQ) have defined and seen first hand just how successful an incremental, pay-as-you-go approach can be in a wide range of service oriented organizations. 

Basically, what we see for back-office and service delivery organizations is that fundamental Business Process Management (BPM) and Lean can make for an incredibly cost-effective way to make near-immediate, high impact improvements. 

In a services environment, BPM and Lean allows you to consistently execute well-defined, low risk, and high impact projects  that are clearly aligned with the real goals of the business …. for many, a better path  to  Continuous Improvement

BPM crystallizes value streams (processes) and establishes measurement systems that clearly identify the highest value gaps in performance, from both customer and business perspectives. These gaps represent business cases, and ultimately, projects.  Define a good prioritization approach, and you have a project pipeline.

Lean is an inexpensive and highly effective way, then, to execute those projects and close those performance gaps.  Now, there is not doubt that not all projects identified will be lean projects.  You will for sure find capital projects, six sigma projects, and even some process redesign projects.  BUT, my experience is that a significant number of the highest value projects in service and service delivery organizations are indeed Lean projects. They focus on doing more with less, reducing cycle time, or reducing cost.  That’s lean.

BPM and Lean.  Done well, you can get near-term results AND set the stage for long-term sustainable results.  And, the beauty of it is that it can be very lightweight and cost-effective.  Contact me if you want to discuss how this lightweight approach to CI might work for your organization.