Why Do Process Improvement Initiatives Fail?
Many organizations have failed miserably in achieving their process improvement goals. Most of these failures occur because the organizations did not integrate their process improvement efforts with their management practices to achieve strategic business initiatives. As a result process improvement is pawned off to the quality department or some other staff functions.
A disciplined approach to process improvement prevents the catastrophic failure experienced by so many organizations. In a disciplined approach process improvement initiatives are targeted at improving those cross-functional processes that have the greatest impact on achieving strategic business objectives. These key processes involve a number of departments in the delivery of a product or service to the organization’s customers. Successful process improvement initiatives recognize this horizontal flow of value creation and are structured accordingly.
Disciplined process improvement is what it takes to achieve positive business results. This means that work is accomplished and organizations succeed based on what occurs within key business processes. By linking strategic business goals, improvement efforts, and the business processes that most affect customers; process improvement does work, and some organizations do achieve results.
There are three basic reasons process improvement efforts miss the mark and do not accomplish critical business objectives.
1. They are not focused, meaning that process improvement is implemented erratically, with little regard for what is important.
2. Top management is not intimately involved in overseeing process improvement efforts. I call this the “bubble up” theory. Senior managers send employees to training, create a lot of teams, and wait for a host of ideas and improvements to bubble up. Top management think that process improvement, customer satisfaction, and cycle time will instinctively improve and that they will realize lower costs and higher profits. It does not work that way. Bubble up is all fizz and no discipline.
3. Some organizations have a vision, but lack the discipline or the focus necessary to make it a reality. Their process improvement efforts flounder because they do not:
– Focus on the key processes critical to achieving strategic goals
– Include top management in the selection process when identifying specific improvement projects
– Provide for regular senior management review to ensure that implementation produces both short-term and long-term results
The evidence is clear, a disciplined management-led approach is essential if process improvement initiatives are to succeed. The approach must be aimed at improving those vital few cross-functional business processes that result in a product or service for the organization’s customers. Discipline is what differentiates championship athletes, dominant sports teams, and world class competitors. In the business organizations top management creates that discipline.
The important thing to realize is that those vital few or key business processes are the heart of the business. Identifying and improving them will in turn deliver dramatic improvements in product or service quality and the bottom line.
The As Is
If we lived in a perfect world, all employees would clearly understand their business processes, create their work, coordinate activities, manage the white space, be very proactive, quickly deliver products or services, and produce defect free work.
The world, however, is not perfect. Almost all organizations are structured and managed through functional departments (i.e. customer service, sales, marketing, operations, accounting, distribution, etc.). Such a functional structure effectively reduces a complex environment to manageable units. However, functional structures ignore the fact that products and services are delivered to customers through horizontal processes, that is, key business processes that cross functional department lines and require cooperation and collaboration from many departments.
In every organization, even if one department has primary responsibility for production, others play roles from marketing to distribution. That is the real world. Unfortunately, most organizations and most process improvement efforts labor under the false assumption that the world looks like the organization chart.
Today’s customers are showing an increased willingness to challenge the inefficiencies and poor service of the functional approach. They are also rebelling against the costs associated with this approach. Work thrown over the wall at the functional transition points not only annoys and inconveniences the customer, but leads to a lot of rework. In fact, rework has been shown to chew up 30 to 50% of the total cost of doing business. Just as important is the impact on current and potential customers when products or services are late, defective, or too costly. It is important to understand that customers care about and react to the end product or service that is the sum of all the functional operations.
Yet over and over again in the workplace this concept is lost. Engineering worries about engineering, sales worries about sales, purchasing guards its territory. Manufacturing merely makes widgets. Customer service fixes problems, and management executes plans or people, depending on how it goes. Now and then everything comes together. All too often, however, everything falls apart, and customers lose. When the customers lose, the business loses them.
The Should Be
Disciplined process improvement emphasis is on managing key business processes across the organization. In other words, managing cross-functional processes rather than taking a functional approach that matches the organization chart.
Further, disciplined process improvement takes the responsibility for process improvement out of the quality department or other staff functions and puts it in the lap of top management. Disciplined process improvement requires that senior managers get committed and stay committed if they want sustained results. It puts the manager where he or she belongs: in the strategic leadership role. Management defines the organization’s strategic goals and identifies the key business processes. Management selects the process improvement strategies and projects and regularly monitors progress to ensure the key business processes are structured and managed so as to achieve the organization’s strategic goals.
Management does not sit around deliberating what went wrong with the process improvement effort or why it works in other organizations. Process improvement has only worked in organizations when senior management was committed.
Why The Emphasis On Discipline?
Disciplined process improvement does produce results. Refining your process improvement efforts by defining the key business processes that deliver products or services to your customers enables you to determine metrics that are important for creating things that the customer value. Using a disciplined approach will also help you overcome the common barriers to process improvement:
– Barrier #1: People dislike being measured: One of the secrets to getting better, making improvements, and increasing customer satisfaction is to realize that your employees don’t like being measured. Typically, when companies measure their employees’ work or productivity, they use the information to blame employees or point out their mistakes. While key metrics in the organization can indeed be useful, you need to use the metrics you uncover to identify how the processes or systems you have in place fail, not how your people fail.
Therefore, look at what you’re measuring and decide if it is providing useful information. Is what you’re measuring addressing what your customers value? After this analysis, you might need to totally change your current metrics. Or you might find that your metrics are correct, but the information is used to blame your people-blame your process instead, and then fix the process.
– Barrier #2: The “hero” complex: Sometimes managers think they know all the right answers. These “heroes” (and heroines) of the organization think they’re golden. They don’t want to be driven in a direction to improve because they think they’re doing a great job already. They believe they’re great managers and don’t need to change. To them, changing something is an admission that something they did or implemented didn’t work. These are the people who truly prevent an organization from moving forward.
All companies need new or revitalized processes, approaches, and techniques to find the hidden treasure in the organization. Help them realize that the golden opportunities are already there in the business-they just have to broaden their perspective to see these opportunities.
– Barrier #3: Getting collaboration between achievers and problem solvers: You can group all of your employees into one of two categories: Achievers or Problem Solvers. To identify the Achievers and Problem Solvers in your company, ask people two simple questions: 1) What is important to you about your work? And 2) Why is that important? Let’s suppose you ask everyone the first question and they all answer that serving the customer is important. When you ask them why that’s important, Achievers will give answers like, “We get more business,” “We improve the bottom line,” and “We increase market share.” To them, it’s all about achieving and what they get. Problem Solvers will give answers like, “We avoid having irate customers on the phone,” “We don’t have as many complaints,” and “We don’t have to do rework.” To them, it’s all about avoiding pain. Once you know which category everyone fits into, you can bridge the gap between the two mindsets so everyone works together effectively to improve your processes.
Conclusion
As your organization continue to grow and change, it is important to understand that some of the processes that worked well in the past may be ineffective in today’s rapidly changing environment. The stakes are high and the challenge is clear: you must continue to improve your processes to remain competitive. By improving processes, you improve results.
Successful process improvement efforts must be integrated with management practices to achieve strategic business objectives. It is a disciplined approach that will help you discover new opportunities, reach top performance, and quickly increase customer satisfaction. Give it a chance. Once you realize what disciplined process improvement can do for your organization, you won’t give it up. It is a habit forming endeavor that will transform your organization.
