Take this challenge:

Is there any process that we should improve on?

By Dr. Sharon Gotteiner

Business processes make both success and failure repeatable. Improving on certain processes can improve the financial results. Can you help achieve that?

What methods have you already tried for improving performance? Lean? Kaizen? Six Sigma? Did you get the results you wished for? It’s likely that you did get some positive effect in some isolated operational areas. But too many academic studies question the overall impact that various process-improvement methods generate. Can you make process-improvements also improve your profitability?

Various process-improvement methods were found to be ineffective in significantly improving firms’ financial performance (Robson, 2004). It has been observed that such methods:

• Did not give clear decision support as to which performance areas to improve.
• Offered little support for measurement.
• Did not result in improvements in overall performance.
• Did not indicate alignment with competitive priorities.
• Yielded low success rates.

Therefore, we may need to follow a more straightforward path, to further improve any given business process. This challenge is asking you to identify one process that, in your opinion, clearly needs to be improved. Any business process or area can be addressed. To help you focus, try to identify one process, that can be categorized by one of the following types of processes:

• Marketing and sales
• Operational
• Key support

What business process do you have in mind, that can be improved?

Now, which aspect of that process should be improved? Select one of the following:

• Capacity
• Productivity
• Quality
• Cost
• Time

Can you provide any data that reflects the challenge about the aspect selected?

If no data is available to support your argument, you may have just identified an opportunity; quite often, improvements can be achieved by making useful financial and operational information more available. Specifically, the integration of these two types of information can generate observations that have not been observed before. In addition, related processes support ongoing monitoring of their outputs.

If data is available, your challenge is to link such data with its financial implication, and give the overall opportunity a financial context. If this context is not clear, you may want to reconsider and re-prioritize the processes you revisit. Specifically, it must be made clear which section of the financial statements can be improved on, by how much, and how. Certain numbers should be affected by certain decisions, policies, or activities by certain managers. Measurement and accountability should support the change as well.

Finally, any change we make has its own risks that need to be managed. One risk worth highlighting with specific regard to process improvements is the mistake of pushing a process beyond its limits, to a point that will compromise its effectiveness. Down the road we can mitigate such risks. So, in the meanwhile::

Can you draft an initial observation regarding any business process that the company may be able to improve? 

Good luck!

© Dr. Sharon Gotteiner, Corpocheck.org . All Rights Reserved. This publication is intended for individual use only. Please consider joining the Enterprise Plan for integrating our materials with the organizational innovation process in place.

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