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Posts Tagged ‘BPM’

Do You Have a Customer-Driven Process Enterprise?

April 7th, 2013 Comments off

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.

Download Business Process Management (BPM) Overviewour 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.

The Next Generation of BPM

February 27th, 2013 Comments off

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Alignment through Business Process Management

February 20th, 2013 Comments off

Strategic Alignment, Organizational AlignmentWhat do we enjoy about leisure activities?  A symphony’s crescendo.  A well executed touchdown.  A sunset from a summit.  We love the harmony.  But in business, there is also value.  Along with that feel good moment, alignment creates value.  It ensures the whole is worth more than the sum of the parts.  And the potential for alignment is in many directions.  We want to be aligned to customers, shareholders, employees and our communities.  But alignment only occurs through design.

In a phone conversation this week, someone asked me what BPM is.  To me it is the design of the alignment.  BPM isn’t the only discipline driving alignment.  In another conversation with a private equity sponsor, when asked about their upstream measures of alignment, I was quickly given financial metrics which if crossed triggered an action.  In such an advanced market economy, we have very refined measures for alignment to the requirements of capital.  And alignment with customers is the essence of Voice of the Customer.

Alignment and Balanced ScorecareSo where can the elements offered in SSQ’s business process alignment focus?  How do we contribute to an organization’s quest for value?  We focus on aligning processes vertically and horizontally using KPI metrics.

We introduce scorecards or dashboards as a way to monitor alignment vertically in an organization. The built-in ability of cascading scorecards, regardless of the number of hierarchies, depicts how the business rolls up from any perspectives.  While easily attained but it is readily understood and accepted.  It fits our view of organizations and compensation systems.

A greater challenge is achieving horizontal alignment.  Even though vertically defined functions and groups have a stake in a company’s outcomes, many times the overall company fails to optimize its potential because resources and information are “owned” by the vertical components. Thus, we create silos.  I am an optimist and believe people want to work together.  But I also believe in our quest for simplicity and accountability, we’ve failed to fully understand horizontal relationships and created incentive systems that drive people to work on their own.

So our implementation of BPM seeks to facilitate an organizations’ understanding of how a course of action adopted by one function impacts other functions. We seek to aid the company building a systems approach by giving the various vertical entities visibility into each other’s plans, resources and performance gaps based on internal and external customer requirements.

BPM Whitepaper – A Structured Approach to Delivering Value

We finally seek to redefine the KPI’s balancing the vertical requirements with the horizontal requirements to get the alignment in harmony.  By comparing those KPI’s with actual performance we help a company define the projects and activities that will close the gaps to the highest scorecard to ensure we also meet external alignment.

The BPM we introduce has many benefits.  It examines and aligns to scorecards.  In ensures financial and vertical measures are met by building the muscle tissue in the form of process definitions.  It focuses on KPIs, performance gaps and prioritized project lists.  But it is unique in its facilitation of an understanding and acceptance of horizontal alignment and thus takes organizations a step closer to its optimal value creation.

So in answer to the question for a definition of BPM, I say the essense is alignment.  And in answer to what we bring different than any other focus, we feel we facilitate overcoming horizontal barriers to value creation.  If you’d like to discuss these concepts and how we can help your organization, contact me.

Strategy, Execution and Operational Excellence

February 17th, 2013 2 comments

Hmm…something’s wrong

What is a strategy?  Where do you separate strategy from execution?  What value does Operational Excellence offer?  Why does any of this matter?

Quite simply, strategy is a decision about who you wish to serve, how you wish to serve them so as to deliver value and what capabilities are needed to succeed.   Answering these questions provides the guidelines by which to allocate resources.

On the other hand, execution takes your strategic decisions and converts them into a vision, mission and operational plans.  If you’re a regular reader of our blog, you’ll know we connect operational plans from each functional area to improvement projects by using core value streams.  Identified performance gaps in the value streams are the building blocks of an Operational Excellence effort.

Why are these distinctions important?  Describing vision, mission, operational plans and operational excellence activities as strategies confuses the journey with the destination.   That mistake ensures you’ll never arrive anywhere.   It also strips away the value of helping a client choose the means by which to execute a strategy.  Putting the cart ahead of the horse, yields both a useless cart and useless horse.

I tell prospects, clients and partners; we’re here to help execute on strategies but we assume those strategies are in place.  One of our value propositions to our clients is that we will develop a governance map from a top level scorecard at the highest point to the deepest sub-processes at which improvement opportunities reside.  There we specify business improvement cases and projects.  However, we expect the client to choose and weight the criteria by which to prioritize the projects for execution so we can allocate resources such as budget and personnel.

It is the choosing and weighting of criteria for project ranking that tells me if a company has a clear strategy.  As previously stated, a strategy specifies what customers a company wishes to serve, how it wishes to serve them to deliver value and what capabilities are needed.  These decisions provide the guidelines by which to allocate resources.  When a company has a very difficult time ranking and rating projects, much less being consistent over time, it is clear they don’t have a clear strategy that is understood by everyone.

Systematically Driving Value with OpEx

When a company doesn’t have a clear strategy, improvement initiatives run into common problems.  The company develops a long list of projects but they are all equally critical.  People work on many projects spending a little time on each and never getting any of them done.

If you’d like to discuss, feel free to contact me

Business Process Management (BPM) – Process Stability as a Prerequisite to Process Improvement

January 22nd, 2013 Comments off

Stability Provides Predictability

After a long business cycle that saw the creation and expansion of performance improvement programs, we have undergone tremendous change that has forced every initiative at every company to re-evaluate its goals and validate its existence.  At some companies, continuous improvement has been repatriated to operations.  At others, it has mistakenly been eliminated and will undoubtedly have to reconstitute at a later date. And for a lucky few, economic changes are providing an opportunity to start for the first time or reorient their efforts to contribute to a new set of challenges.

Those that seek to prosper in the new normal get excited by the prospect of implementing or applying a responsive system that offers such promise. It is a pretty appealing prospect and there are a number of books that paint this picture as attainable using a variety of methodologies (i.e. Lean, Six Sigma, etc).  The challenge is that with all the turmoil of the last several years few have the infrastructure needed to really identify or sustain high value improvements, and this presents a major dilemma.

So, how can you overcome this dilemma? If you want to implement any improvement methodologies effectively, there are some pre-requisites must exist, possibly even before you attempt your first improvement project.  You can’t put an improvement in place if staff doesn’t follow standard work in a disciplined way – improvements rely on control to actualize the planned benefit.

The very arguments that support the exciting prospects of improvement methodologies often neglect to mention these issues, perhaps because they assume that the desire to improve makes you “ready”.   But sometimes that’s not the case and you must build a foundation before you try to put up the building.  The term that’s normally used for being “ready” is Basic Stability. It means that you can pretty much rely on your people and equipment to do what they are supposed to do, and you have a way (i.e. metrics) to verify.  Basic Stability usually involves establishing (or re-establishing) standard work processes and key process metrics.  Everything need not be perfect, but operations should repeat in a consistent manner or any change will soon be lost and thus the effort will prove to have been worthless.
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Download “BPM – A Structured Approach to Delivering Customer Value”

A good Business Process Management (BPM) program establishes the cornerstones of repeatability and thus Basic Stability.  Along with establishing alignment and cross-functional thinking, it  identifies and characterizes processes, identifies data sources, identifies key metrics, and provides for process analysis and control.  If this is in place, soon enough you will get to the place from which you can make those improvements and have them stick.

And, the good news is that establishing a foundation Business Process Management (BPM) does not have to be overly expensive or resource-consuming.  See more about our BPM approach with our complimentary power point download or contact me directly if you want to discuss.

Economically Delivering the Right Mix of Lean, Six Sigma and Business Process Management

January 17th, 2013 Comments off

The Right Mix

My colleagues and I have written about this subject from several angles I want to start bringing it togetter.  In my post On Demand Performance Improvement  and Lynn Monkelien’s, Senior Director of Enterprise Learning at the Apollo Group and SSQ guest blogger, post entitled Pull Learning in Business Process and Performance Improvement we discussed how to break the paradigm of training inefficiencies.  This was further supported in my white paper entitled On Demand Performance Improvemnt – Traditional Training Meets Social Media which is available on our website’s home page in the “spotlight” section.  Then my colleague, Eric Harris wrote Back to Basics where he introduced the various foundation aspects of Yellow Belt, Lean and Business Process Management.   Since then there have been numerous posts on each of these subjects.

Together we are all describing a new training paradigm that is emerging where with our clients we not only making better use of technology and social media standards but also of a contemporary and robust library of materials and broad capability of personnel to meet the contemporary needs of organizations.  Specifically, with so much pressure on costs and the limited availability of company personnel’s time, it’s not surprising that most companies are looking hard at how and what they delivery to their workforce.  The key is to define what is needed… nothing more and nothing less…in terms of both content and exposure.  And that is done by matching the depth of training to the problems the organization seeks to address and putting the information into the users hands in as many low cost forms as possible as close to the actual application as possible.

And here are some questions to ask when considering how to get the chosen information to the user:

* What sort of time is available from the targeted personnel? Can they spend a day in a classroom or is thier time limited to hours per day or per week? Will targeted candidates be in different locations or at one facility?

* Do you know exactly what thier problems require or will it evolve over time?

* Are they comfortable with technology and social media?

Overview of SIPOC & a 12-step process to build one

Here are some factors to consider when asking what training and coaching is needed:

* Are you addressing manufacturing, engineering or transactional processes?  In factories and laboratories where much of the improvement activity may focus on equipment, techniques such as Gauge R&R, Process Capability, Setup Reduction, Total Productive Maintenance and perhaps even Design of Experiments are invaluable.  But in transactional businesses, they can be substituted with more impactful subjects.

* Are you dealing with high-volume repetitive processes?  Much of the Lean training can be simplified and reduced if you are not.  Value Stream Mapping, for example, can be covered at a more general level.

* What is the objective and the environment?  Are you attempting to remove defects or reduce cycle time?  If you seek to reduce errors in a financial services company, the focus is on process analysis so Pareto Charts, Run Charts and the like, which are quick and easy to teach, become the focus.

The point is that you have choices.  You can follow a fairly standardized prescription for Lean Six Sigma training as described through the classic belt definitions or you can tailor your training to unique needs.  At the same time, you can perform standard instructor lead training or you can use various communication tools that leverage technologies and social media standards.

I have one note of caution –if you cut the content or instructor interaction too far, the price for the mistake doesn’t immediately show itself during the training.  Problems evidence themselves once the training is well underway or completed.  And the problems might be that projects get delayed, more coaching is needed to complete high value projects or certified candidates fail in follow-on projects.  The result is a general loss of confidence emerges for the whole process.  By the time you discover your mistake, the effort is deemed a failure.  We don’t say this to scare you into overbuying or overdesigning.  We believe the answer is to monitor the situation closely and maintain flexibility in both the training and support.  It is in this reaction time that modular content and flexible, technology enabled support tools and methods really make a difference.

If you would like to discuss this emerging model, contact me.

Mayhem – The Case for Business Process Management

January 11th, 2013 Comments off

Needs a Process!

Companies often deny they have a process or admit they don’t follow the processes they’ve developed.   In today’s economic environment, many attribute this behavior to a lack of resources.  Oddly enough, this behavior and explanation often comes from professionals that know the cost of not establishing or following processes.  Leaders have created a seemingly endless list of reasons for dismantling process efforts and eliminating process improvement projects.  Let’s examine those reasons and how to respond to them:

Reason No. 1: “I can’t do just a couple of processes. I’ve got to improve them all, and I’ll never get that done.“

Response: Concentrate first and foremost on the processes that touch the customer.

 

Reason No. 2: “Process improvement takes too long. “

Response: Not every process requires the same level of resources or attention to build, design or repair.  And not every process carries the same importance.  Also, most processes can be fixed or redesigned in weeks, and some should be finished in days.  Pick the ones that provide the most juice for the squeeze.  Get them 80 percent right and get it done. Resort and prioritize frequently.  You eat an elephant a bite at a time.

 

Reason No. 3: “All processes require a blank-sheet approach to redesign. “

Response: Not true. Some portion of the process can always be salvaged and reused in the new version.

 

Reason No. 4: “Modeling my process is complicated and it won’t get me anywhere. “

Response: Software is available to perform modeling and save hours of frustrations. It runs the process in the confines of the computer before it’s unleashed on the organization.

 

 

A basic view of BPM and a three step approach to implementation.

 

Reason No. 5: “We don’t need to spend time understanding the current process. I already know what the new process needs to look like. “

Response: Take the time to understand the current environment. This is by far the best technique for ensuring a smooth transition to the future.

 

Reason No. 6: “We’ve already improved our processes. “

Response: Process improvement is never done.  It is constantly on-going as people, technologies, customer requirements and competitor offerings change.

 

The point of this discussion is that if your company has responded to profit pressures by dismantling its process management and improvement efforts in favor of simply responding to immediate needs, you must revive mission before the undeniable problems come home to roost.  In restarting, reviving or keeping such efforts alive, adjust to the realities of our new economic environment.  Reduce what is being done to the available resources and focus on the customer.  Then continue to make the business case and document the ROI\ which reminding what has happened in the past when these efforts have been abandoned.  The case is as strong now for process improvement as its ever been.

If you would like to see how SSQ recommends its clients hone in on what is important and ensures a high ROI on the efforts, either download our slide presentation on BPM or contact me.

BPM and Lean – For Many Service Oriented Organizations, Enough to Get Big Improvement Results

October 4th, 2012 1 comment

Might Continuous improvement (CI) be making a comeback after a several years of being severely cut back or outright eliminated?  I think they just might be, and I see it most in service delivery organizations. But, they’re doing it for different reasons and they’re doing it in a different way.  Simple and light-weight trumps top-heavy and complex.  Near-term wins reign supreme over long-term initiatives.

Why the re-emerging interest? Well, the simple answer is that things are just different than they were, even just a few years ago.  I talk to business leaders every day, and I don’t hear “we want to start a program to instill a culture of quality and continuous improvement in the company”.    No, what I hear about are specific business problems, and immense pressure to immediately and inexpensively fix the problems.   Feel good corporate initiatives are out ….  in the trenches get it done  thinking and actions are in.

Problems in service organizations 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).  This insight doesn’t bode well for the near-term employment outlook, but it’s what I see nonetheless.

BPM and Lean for Services OrganizationsAnd, it’s not just the reasons for doing CI that are different. The way business leaders want to do CI is also different.  There is almost no appetite for big dollar, infrastructure-heavy corporate initiatives. The focus is almost entirely on quick wins … show me the money.   Now, I know there are some practitioners out there might say that a focus on near term results is just a recipe for disaster, but I just don’t think so.  We have to live in the real world, and this world requires a shift in perspective.

So, my argument …. For many service organizations, fundamental Business Process Management (BPM) and Lean combined with some light-weight infrastructure components can make for an incredibly cost-effective way to make near-immediate, high impact improvements and set the stage for long-term sustainable results.  A true win-win.

In a services environment, simple 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.

Download BPM

a BPM Overview presentation

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.

Download Lean Services

 this short .ppt overview of Lean for Service Operations

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.

Change Management – Is it as Simple as Just Seeing Clearly?

September 29th, 2011 5 comments

Change management - Use VOC and VOB to objectively identify performance gaps that matter mostWe’ve been working with a number of customers of late that are trying to improve service delivery processes, and move into the differentiating realm of service innovation.  In these very large enterprises, it’s always a challenge to get organizations to change behavior.  Immediately, voices start rising, touting the need for change management.

This is another of those terms that can have a lot of different meanings to a lot of different people.  Wikipedia defines change management as a structured approach to transitioning individuals, teams, and organizations from a current state to a desired future state. If you google “change management”, you really enter the swamp.   Even if we narrow change management to the business / process improvement world that we at SSQ live in, there is still a lot of confusion.  How do you sort it all out?

Download Business Process Management (BPM) Overview

our BPM Overview presentation

In the CI world, companies want and need to markedly improve their value-generating processes (value stream), but the question becomes how do you get people to embrace the changes that come as part of improving?  How do we get them to embrace the overall effort to improve processes, and theoretically improve service delivery?  Do we really have to indoctrinate them into some new philosophy of change?

Personally, I don’t think so.  I think that many times change management becomes a problem because people don’t have a clear picture of 3 simple (not really) things:

  1. where they are now,
  2. where they need to be
  3. why they need to get there.

Most organizations have plenty of smart people (I know … there are exceptions!)  .  The fundamental trick to change management really boils down to getting all those smart people pulling in the same direction.   If you can get clarity around the 3 simple things above, you might be surprised to see that change management is not the big issue you thought it was.

I’ve used the term simple to describe these three things above, but getting there can be anything but.  With our engagements, we spend significant time on the front ending trying to get these answers, and I can assure you that it can be challenging.  But, we get there, and I firmly believe our success rates with business improvement efforts are better because of it.

There are other ways I’m sure, but we use a structured approach that attacks the problem by:

  1. Understanding, for both the customer (voice of the customer) and the business (voice of the business), what constitutes high-performance and turning that into clearly defined metrics (efficiency and effectiveness).  We are looking for gaps in these indicators, between current state and where we need to be.
  2. Understanding the top-level value stream from a process perspective (not function), the things that have to happen to deliver your services or products, and create customer and business value
  3. Identifying metrics at the process level (VOP), and making sure they are aligned with top level VOB and VOC (#1).  Like #1, we are looking for the gaps.
  4. Defining an objective prioritization scheme based on voice of the customer and voice of the business.
  5. Identifying improvement ideas from the gaps, and evaluating and prioritizing those ideas objectively based on #4.  A prioritized project pipeline.
  6. Turning high-value project ideas (business cases) into tightly scoped improvement projects that are clearly aligned with very visible objectives (#1)

Of course, this is over simplified. There’s a lot of work happening between the spaces, but think about it and ask … Is change management really as simple as being able to see clearly? As always, I welcome your thoughts on this.  Comment or contact me directly if you prefer.

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.