This forum is for discussing Energy-related Lean Six Sigma and process excellence improvement efforts.
A decade ago, companies differentiated themselves from their competitors using products and pricing. The internet has changed all that. Customers can quickly search for products online and even compare. They can easily choose to purchase from the company with the lowest price.
Change is Constant
Today, companies should be looking at the customer experience as a differentiator. How customers interact with your company is a process – one that needs some attention.
A customer experience consists of the customer’s perceptions of their interaction with your company. It is how the customer ‘feels’ about doing business with your company. It is the customer’s reaction to how they interacted with your employees.
Deliver a great experience for your customer throughout their ‘customer’ lifecycle and the results will improve your bottom line.
We are in the midst of change.
The internet has had a big impact on how companies do business. Companies are just now exploring the impact of social media. Mobile is next – companies are still trying to determine the impact. Then there is the cloud and ‘what does that mean to me?’
Improve your customer’s experience to attract more customers, to retain more customers and to increase revenue. If you doubt this, look at what Amazon has accomplished – or Apple.
It’s often all too easy to bundle “processes and procedures” into one statement as if they are a single entity. Of course, they aren’t, but ask a dozen people what the difference is and you are likely to get a dozen different answers. Throw in the oft misunderstood “work instructions” and chaos can ensue!
When working to improve business processes and procedures it’s critically important to define what each is prior to embarking on the improvement initiative. This sets a clear understanding for the business in terms of what work will be performed.
The easiest way to think about processes and procedures is in the level of detail of the information. Processes can be described as being at a “high level” and operate across the organization’s varying functions, whereas procedures sit at a “low level” i.e. they contain detailed information. Both are, of course, intrinsically linked. The procedural level can be thought of as a detailed breakdown of a step in the process.
So what are the key difference between processes, procedures and work instructions?
Processes are cross-functional and define what is done and by whom. They are often depicted in diagrammatic form such as a decision tree or flowchart where the work performed is split into logical interrelated steps or “activities”. Processes should always have a “trigger” or start event and a “terminator” or end event that achieves a specific result. All processes should seek to fulfill a successful customer outcome.
Procedures define how the work is performed. They are typically documented in a step by step order with detailed descriptions of how the work is to be performed and who is responsible for performing the work.
Work instructions add a level of confusion to the puzzle, but are generally recognized as a sub set of procedures. The way they differ is that the work instruction is typically written to describe how to do something specifically for a single role, rather than procedures that may contain instructions for several different roles within an organization.
How to Use
The next question then relates to how each of these should be used.
The answer is simple: together.
Processes are an excellent means of quickly displaying the entire process in an easy to understand format, but on they are too high level for staff to use to perform their day-to-day work. This is where procedural detail is required.
The solution to this problem is to always pair process diagrams and procedural detail together, clearly showing the step (or steps) in the process that the procedure refers to.
This way staff can see the greater context and implications of the cross functional process whilst having the level of detail required to be able to successfully complete their own tasks. Work instructions can also be used in this manner but caution should be exercised as single role based work instructions can lead an insular view of the work being performed. Well-written procedural detail can often eliminate the need for documenting work instructions.
Processes, procedures and work instructions are all part of the business Eco-system, and just like life on earth, they work best when we work to manage all of them together in perfect harmony.
@tribrandconsulting… Helping Complex Organizations Achieve World Class Efficiency and Customer Experience
“BPM is a fantastic basis for business optimization and improvement”.
Right now I am involved in a Lean program that helps the organization to be more customer focused and improve operational excellence. As said before, BPM focuses on the business process, the value chain, connecting customer need to customer value. Still, BPM is process focused. In Lean, you look at different area’s. Not only the process matters, also the purpose and the people do matter. Maybe they matter even more? That is what I love about Lean: Lean gives a holistic approach to improving customer value, looking at the process, the purpose and at people.
Business is about people. Customers are people, organizations are people. Customer satisfaction is an experience, not only a fact, driven by running the best business process. Employee satisfaction is not only a figure, it is a key to effective collaboration and thriving customer value. This is what makes Lean ‘more human’. Lean is not a bunch of tools or models, it is a way of thinking, a way of life, a philosophy, it is about culture. BPM is a part of it, mainly focusing on process efficiency (as related to value for the customer).
It is important to focus on process efficiency. It is obvious that customers don’t want to pay for activities that don’t add value to the product or service they buy. Also, inefficient processes will ultimately put you out of business if you don’t optimize, since your competitors will. Waste is waste, that is where Lean is about: eliminating waste on all levels. The process is the most obvious level to find and eliminate waste. With Value Stream Management, you can draw the process and add the value of each process step. How long does it take, where do you have to wait, where does an activity add value (and where does it not)? Value Stream Management relates to BPM and is a very strong way to find and eliminate or reduce waste. Business Process Optimization is a means of reducing waste.
So, I’m still not saying that the process doesn’t matter, on the contrary, it does! What I am saying is: there is more.
You need a revamp on your business process….. Call on us @tribrandng
Lean Management (Lean) and Six Sigma are getting more and more popular. These methods were developed in the industry, but have proven to be very powerful for service organizations as well. They use the approaches and instruments to systematically work on process and quality improvement. With the large challenges many service organizations face (cost cuts, quality issues, increasing customer demands) these improvements are more than welcome. But which method is best?
Like always, this depends… Both methods have their advantages and disadvantages. Let’s take a look at the methods from an ‘instrumental’ point of view:
An important strength of Lean is the fast implementation. Lean aims at standard solutions to standard problems. Lean is focused at customer value and waste. By applying Lean best practices organizations can quickly streamline their processes and remove waste. Quick results can work as a catalyst for further Lean implementations and Lean successes.
But what if your problems are no standard problems? In this case Lean won’t (completely) resolve them. You might need ‘something stronger’.
Six Sigma is a method for analyzing and resolving complex problems. Based on measured facts, a dedicated improvement team will use powerful (statistical) techniques to really understand the specific problems. Symptoms, problems and causes are identified, enabling the team to fundamentally improve processes.
But Six Sigma comes at a cost. Setting up the program and training the team members is expensive. Also, the method achieves improvements by resolving ‘problem by problem’. With a typical Six Sigma project taking about three months, it will take a lot of time (and costs) to come to a big impact for the organization.
So both Lean and Six Sigma are powerful. It all depends on the problems you have and the fit of the techniques with your organization. If we look at service organizations, we usually see lots of opportunities for improvement. They all face challenges like customer focus, quality and processing speed. Lean offers easy-to-use, common sense techniques to tackle these issues. Six Sigma is powerful as well, but for many organizations a bridge too far. The complexity of the method could draw away the attention from what it should be all about: improving processes and achieving results. Many organizations that experimented with Lean and Sigma also came to this conclusion: initially remove waste and streamline processes with Lean; secondly use Six Sigma for specific complex problems.
Besides the instrumental viewpoint on Lean (and Six Sigma) there is also a cultural viewpoint that might be even more important. Organizations that are successful in systematically improving processes don’t only use the techniques, but they ‘live them’. There is a drive to ‘do the work every day a little bit better’. Lean becomes part of the culture.
‘Make the customer the hero of your story’ – Ann Handley, Chief Content Officer, Marketing Profs.
Have you looked at your business from your customer’s point of view? Do you measure and monitor how well you deliver what your customer really wants?
They want things like…
◾On-time delivery [In today’s culture, customers are into instant gratification]
◾Accurate order [Returns are a hassle]
◾Flawless service and support
In summary, they want value for their money.
Do your processes support that?
Start by looking at your ‘Moments of Truth’ – the places where your internal processes interact with your customer. I suggest that you speak with some customers to see how you are doing. Ask them how you might improve.
Determining a way to measure how you are doing can get difficult. The metric you choose needs to be useful. You need to be able to objectively measure it. When you have established your current metrics, you can now look to improve those numbers.
The benefits of business process management
There are many benefits to managing your business processes. The benefits may differ from company to company, but they are very real.
The University of San Francisco posted a blog that identifies some important benefits:
◾Simplify regulatory compliance
◾Promote safe working conditions
◾Protect company resources/information.
These benefits will decrease costs and should increase revenues. Your expected outcome – increased profits.
If improving your processes leads to increased profits, then continuous process improvement just makes sense
The simplest way to address continuous process improvement is to have a process for improving your processes.
You could address a change to a process the same way you address a change to a product or service – through a change request. Obviously, this change request will follow a different path to implementation. Interestingly, medical manufacturers attempting to be FDA compliant are actually required to have a process improvement process.
Contact me if you would like some help with your process improvement process…….
Whether you like it or not, change happens…
Typically, we will respond to the change by taking some action. It is very easy to take the wrong action if you haven’t looked at the entire process. Once you look at the ‘whole’, you may see several things that could work better.
Focus on your Customers
Today, happy customers aren’t enough, you need ecstatic customers. An ecstatic customer will refer your company to others. It is important to understand how your customers interact with your company. There may be ways to move them from happy to ecstatic. I have pointed out Amazon before – they are always looking for ways to make it easier for their customers to buy from them.
Come up with new ways to take advantage today’s innovations. Be innovative yourself. These innovations can help you move your customers from happy to ecstatic and increase your revenues.
Look at how you are currently doing business. Become change agents. Think courageously and challenge the current way of doing things. Embrace diversity of thought and the different ways your employees think and act. There is always a way to improve a process.
Take on BPM and turn it into a competitive advantage.
Business process management (BPM) is a methodology used by more and more organizations, specifically those that embrace business processes as a management tool. Processes are connected activities that span across departments, people, systems or roles, which are often represented by a flowchart. Processes have been proven successful at helping companies meet their goals by aligning resources with customer requirements.
BPM Increases Business Agility
In today’s fast-paced, global business environment, organizations must quickly respond to changing conditions, or they won’t survive. Customer preferences, government regulations, supply chain issues and competitor performance can all have major and immediate impacts on sales and operations.
BPM makes companies more agile, with a platform that supports process modifications, enabling a business to eliminate shipping delays, reduce a new product’s time to market, bring a new supplier onboard or improve customer service. BPM also provides the means to implement new processes faster, which is helpful when new opportunities develop.
Implementing BPM can greatly increase an organization’s efficiency. As each process is examined, inherent waste and other inefficiencies become clear – and can be eliminated. With BPM, for example, customer accounts can be opened more quickly. Employee training is accelerated. Manufacturing processes are consolidated. Companies are more efficient. As efficiency rises, revenue and profits increase. The more effective an organization becomes, the better its growth potential.
One of the biggest BPM benefits is an overall increase in transparency. Many companies experience an inability to proactively recognize where their processes fall short, but with BPM, they can utilize technology to gauge and better understand process performance.
BPM enables the recording, monitoring and measurement of every process activity. From there, companies can identify opportunities for improvement, make necessary modifications and boost efficiencies.
Why BPM is a Must-Have Tool
Business process management offers companies an efficient platform to respond to customer needs, as well as changes in the market. By facilitating the implementation of new processes or changes in existing ones, BPM enables organizations to remain competitive and stay flexible in both long-term strategies and short-term actions. BPM is the ideal tool to move an organization toward its goals, while cutting costs and improving efficiency, with the agility needed to respond to new opportunities that support growth.
Continuous improvement is a management philosophy and system that organizes employees and processes to maximize customer value and satisfaction. As a total management system, continuous improvement provides a set of tools and techniques that can result in outstanding performance if implemented completely over a period of several years.
One of the most significant components of continuous process improvement is its goal of compressing time in every way possible. Figure 1 shows the phases in a continuous
improvement process. The specific critical assessment steps are given in Figure 2. The champion of the continuous improvement effort, generally a senior manager, translates the corporate vision into a mission and a set of goals and makes sure they are
communicated to all employees.
With continuous process improvement, employees become part of a process in which decisions are a team effort. In order to provide employees with the necessary tools, constant employee training must be the foundation of any continuous process improvement effort.
Continuous process improvement also requires a dedication to following through with immediate
implementation. Management must be tolerant, supportive and allow for failures. This demonstrates a total commitment to continuous process improvement.
Successes, as well as failures, should be published to show that the employees’ efforts are supported and to give them the momentum to try again.
Process improvement is aimed at identifying the waste in your processes and eliminating it. It is about understanding what parameters in your processes are important, monitoring those in real time to make sure they are always on target, and then improving them if they are not.
Improving your process means eliminating the bottlenecks in your process that throttle the smooth flow of work from one process participant to the other. The process participant can be a person or a system. Improving your process means reducing your cycle times, so that you can process more orders or can serve more customers with the same resources. Improving your process means reducing the cost of processing each order, resolving customer disputes faster and, thereby, increasing customer satisfaction. Improving your process means identifying redundant process steps that can be eliminated.
In order to improve the process you need to understand what the measures for the process are. These can be referred to by various names like “process metrics,” “KPIs” (key performance indicators), “performance objectives,” etc. The idea is that in order to improve the process you should be able to describe what your process is and measure the process for its performance. Only then you can improve the process. The metrics for the processes are determined by your business goals. If quick processing of orders is important to you and your customers, then the cycle time of your order management solutions needs to be the key metric. If reducing order management cost is the business objective, then you may want to reduce the number of orders that need special processing because it is more costly.
Business people are most suited to identify the process metrics or KPIs as they are the ones who manage the business and are responsible for its performance. Business managers, whether they are responsible for order management, fraud detection, or product delivery, have certain performance targets that they strive to achieve. Because business results directly affect their performance evaluation, they want to know at all times how they and their teams are performing—so that they know if they are meeting their targets or their plan needs a course correction. That is why it is important that the business managers have the ability to define the metrics, monitor them and do something about them when they fall short of expectations. They need to do all these without needing to wait for lengthy, time consuming and costly IT projects.