Doubling-Down to Develop People and Processes

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Explore the benefits of linking business process improvement simultaneously with leadership and organizational development. A better business awaits when you double-down.

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Doubling-Down to Develop People and Processes

  1. 1. Work better. Get Doubling-Down to Develop People and Processes You want to your business to be more productive You need your business processes be streamlined and run more reliably You want your employees to be more engaged and service your customers better Identify whether you should invest in developing people, processes, or bothVisit us at: Contact us at: Speak to us at: 1 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  2. 2. Work better. GetDoubling-Down to Develop People and ProcessesIt is a sunny Wednesday morning and you are raising your freshly brewed cup of coffee to your lips. Yourdepartment supervisors weekly reports are on your desk, showing a healthy up-tick in productivity, and theoffice managers have celebrated winning their appeal to source only recycled paper for the photocopierswith an office-wide email. Corporate life is not so bad. And the coffee smells amazing.You hear a knock-knock sound come from your open office door. You look round your raised cup of coffeeto see David, your boss, a man not known for his quiet composure looking more agitated than usual.Before you get a moment to speak, your reverie of fresh coffee and organizational clockwork races to hideunder your desk in the tangle of network cables. David speaks:“I was reading <insert favorite executive journal name here> on my ride to the office, and I think we need tobe more like the best companies in the world. We need to run our processes like GE and train our peoplelike FedEx. That way well beat our competition into the ground.”.David steps away from the doorway, then pauses just long enough to look you in the eye and say, “Let meknow your plan by Friday morning”.Betting on Business ImprovementWhen making investments in business improvement to make company operations better, cheaper andfaster, there are two common strategies, as David hinted: 1) employ leadership and organizational development to get the best out of people 2) refine and automate business processes to achieve efficiency and quality with the skills you haveMost organizations know that focusing on one approach or other can help them meet many of theirproductivity or efficiency goals. Most of the organizations that have taken the leap to betting on bothapproaches simultaneously are renowned for their quality product design and manufacturing excellence.Visit us at: Contact us at: Speak to us at: 2 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  3. 3. Work better. GetThere are not so many examples of services companies that take the chance to double-down wheninvesting in their business improvement. But David may not be far ahead of his competition in realizing thatthe payback can be enormous. When we look a little deeper, it also becomes apparent that unlikeBlackjack, where the double-down term originates, the overall risk of failure is actually reduced when acompany takes a holistic view. Before we look at the companies that have succeeded with a strategy ofpeople and process development, we should look at whether each approach is right for your specificcompany.No More Touchy-Feely HRThe terms leadership and organizational development and business process improvement can havedifferent meanings depending on who you are talking to, so lets make sure we dont leave anything tochance and clarify what we mean in this discussion.Business improvement through leadership and organizational development is used by companies with along history investing in the performance of their employees, and is the domain of organizationaldevelopment consulting firms that help them formalize training programs specific to their needs. A widelyreported example of a company that does this well is FedEx, with detailed development plans andcertifications for every employee and strong leadership development. Companies like FedEx invest deeplyin proven employee engagement methodologies, consisting of components such as: • employee certifications to identify areas for personal improvement • employee surveys to identify issues that need to be addressed at an organizational level • employee development and training based on current roles and a need to grow • leadership development to help managers work better with their peers and direct reportsSurprisingly, this is rarely about touchy-feely HR issues. Organizational development from the topconsulting firms relies on rigorous methodologies, organizational psychology, and an almost scientificapproach to measurement and action, making it hard to argue with the results. The development programsare often tied back to measurable business metrics that show a direct correlation between improvedVisit us at: Contact us at: Speak to us at: 3 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  4. 4. Work better. Getemployee engagement, customer service quality, product quality and overall company performance.See What You Are FixingThe second approach to business improvement, by directly modifying business processes is the approachtaken by manufacturing production-lines worldwide, and emulated in office environments with businessprocess management (often referred to as BPM) tools. The process improvement approach builds on thetangible concepts that businesses will operate better if they: • run using streamlined processes that weed out wasteful activities • reduce the time-lag between activities • use employees where they offer most value and automate the rest • implement changes that reduce errors to prevent the need for reworkThis approach, which sounds like common-sense, is given structure by the Lean methodologies, including:Lean Manufacturing, focusing on removing waste; Lean Dynamics, focusing on removing lag betweenactivities. Six Sigma takes the process improvement to another level of rigor that most practitioners wouldagree is not a good place for organizations to start their process improvement experience. In an office /services environment, a business process is typically the flow of activities that must occur to service atransaction, a customer request, or create some other work product. Without the physical constraints of amanufacturing production-line, the design of a better process in an office environment is typically coupledwith software tools for managing the minute-by-minute flow of work between employees, with it landing ontheir desks in specific PC-based applications.Know the Team PlayersWhat style of organization benefits most from leadership and organizational development? If we look at theprofile of companies the organizational development consultants are marketing to, well get a good idea ofthe profile of customers that are most likely to benefit from their methodologies:Visit us at: Contact us at: Speak to us at: 4 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  5. 5. Work better. Get • services or product organizations... • that have regular communications with customers through delivery, sales or customer services channels... • where a level of engagement, innovation and intelligence is required by employees... • the activities performed are core to the companys business... • and the operations can not be automated or outsourced while retaining the expected level of quality or customer service.So it seems, our FedEx example was a good one. Others good fits are research companies like 3M,Proctor and Gamble and WL Gore, since employee engagement is core to their product innovation. Thenthere are the companies renowned to top customer service, like Four Seasons Hotels. We know thesenames for a reason, and we accept that they excel at what they do. Imagine what our collective opinionswould be of these companies if their employee development followed more of a hire and hope strategy.Know Who Keeps Things Ticking Like ClockworkInterestingly, it is rare for companies outside of the product manufacturing space to be credited with havingachieved process excellence. When we try and think of names, we always end up with Motorola, GE andToyota. After a little research we come up with companies that had to excel at automation to succeed, forexample: Amazon.com, for the level of automation it takes to actually exist; Bank of America, which in thefinancial services space does a better job than many at applying technology to common business processproblems; Toyota (again), since it applies the extremely lean Toyota Production System to everything itdoes, not just manufacturing.The reality is that process improvement in office environments is not a new concept, although away fromproduction-lines it has only recently been applied in a consistent enough manner for its methodologies,such as business process management to be recognized.Visit us at: Contact us at: Speak to us at: 5 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  6. 6. Work better. GetOil and Water Dont MixThink again about the two approaches, one focused largely on how people act, and the other focusedexclusively on what they do. Remember the distinct profiles of the companies that have benefited fromthem. With all this context, is it possible to envisage how employee development and process improvementcould ever be used together?I have worked with a range of companies and government agencies, and all of them wanted to improve theway their employees worked through the introduction of some repeatable business processes. The aim wasfor them to finally put some structure around the best practices their most seasoned workers had beenrefining (often only to make their own working lives easier) during years of service. The organizationswanted to capture the experience and efficiencies of the best people, to benefit all the employees workingin the process, and quite frankly because they recognized that one day those experienced employeeswould retire, leave to raise children, or get an offer from a competitive employer that they just couldntmatch.Why did these organizations select the automated management of their business processes, when theycould have just as easily picked to develop the skills of the many involved employees directly? Threereasons came back during business analysis: 1) The opportunity to make cost savings by reducing or reallocating employees 2) The need to add automated control to processes to reduce errors, avoid fraud, and demonstrate best-practices to the Chief Compliance Officer 3) The belief that a business process is tangible, therefore its improvement would provide clear, measurable benefitsMaybe we should ask ourselves if the same thing could be achieved by applying leadership andorganizational development programs. In this regard, it might be possible to claim: 1) Employees equipped with skills directly related to their activities are able to work more efficientlyVisit us at: Contact us at: Speak to us at: 6 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  7. 7. Work better. Get 2) Employees trained in the compliance requirements of their business can catch mistakes and issues that go way beyond those codified in automated software tools 3) The effects of employee performance can be observed to improve business metrics and key performance indicators as positively as process improvementThe problem is that many organizations seem to believe that this is an either-or decision. Especially afterseeing a success following one approach, they chase they same results in the same way, over and over.We have seen time and again companies that became dogmatic in their application of a singlemanagement principle start to lose their sparkle after a while. A single approach starts to deliver fewerbenefits, and the top-down mandated application of the approach requires greater spending to achieve thedesired results. It is clear that companies should consider business improvement more holistically, takingthe opportunity to reinforce the gains they have with one approach with complementary components froman alternative approach.Mixing Oil and WaterThe reality of the working world for the majority of office / services employees is that they could truly benefitfrom improvement both of what they do AND how they do it. Most people are not working mindlessly ontasks that need repetitive actions rather than brainpower. And the majority of office workers are not onlyexercising their innovation to solve brand new requirements every moment of the day. People are workingon tasks that are familiar, in where they comes from, the type of output that is required and what has tohappen to the task next. At the same time, these tasks can rarely be considered to be so repeatable thatthey are completed without any intelligent input.Some examples may help to show how common this mix of work is: Customer services representatives: agents responsible for working with you as a customer to solve a problem that you cant address on the companys self-service website. The agent needs the skills to communicate, understand problems, address them, and provide feedback to you in terms you can understand. If this could be automated, you would never have needed to call customerVisit us at: Contact us at: Speak to us at: 7 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  8. 8. Work better. Get services in the first place. Despite this, your call sits inside a workflow that may have to pass from one agent to another, to back-end systems, or require follow up with you the customer at a later time to ensure that everything is now operating as expected. Service Technicians: mobile workers servicing or repairing equipment onsite or in customers home. The technician is a key part of a workflow that starts with a request from a customer and appears to finish with a successful outcome – a working piece of equipment. The work that the technician does to repair or service the equipment requires intelligence and experience. The workflow continues beyond the obvious outcome, to include ordering of new parts, billing and warranties. Insurance Claims Assessor: the person collecting the information and in large part assessing a clients insurance claim. The flow of work leads them to request, consume and follow up on a variable set of information relating to an incident. The workflow and standard set of information required for an insurance claim can be mapped into a repeatable structure, although the activities required of a claims assessor require experienced decisions and communication skills. The claims assessors final decision is not the end of the workflow, as the claim passes to related processes for payment, subrogation and so on.As we can see, people perform meaningful activities in end-to-end business processes. The skills of thepeople to do their work effectively, interacting with customers and team members is essential for majorpieces of work to get done. The ability to manage a process that can extend through significant periods oftime and cross organizational boundaries, without wasteful activities distracting valuable workers, is whyprocess improvement is so complementary to employee development.What if I dont Double-Down?There is nothing to say that investing only in process improvement or in employee development will leadyou to lose. Much like the double-down analogy in Blackjack, if you win with a simple bet, you still win, justnot with the same return. Unlike Blackjack, by addressing both approaches simultaneously, you mayVisit us at: Contact us at: Speak to us at: 8 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  9. 9. Work better. Getactually reduce the risk of losing. What do we miss out on if we shy away from a larger investment to coverprocess improvement and employee development?(1) You cant avoid employee training If you make significant changes to your business process and the applications that employees must use to do their work, you have to train them to work in the new structure. Therefore there are efficiencies to be achieved in also incorporating training of best practices and behaviors into the same training program. It may actually make it easier for employees to absorb, since they can avoid the common mistake of trying and force-fit some of their old, unproductive work habits into the new process.(2) Reducing risk is an option Any far-reaching change in an organization represents a risk, and always leads to a short term reduction in productivity. Only addressing one side of a business improvement program leaves the possibility that you will see far less than half of your expected returns due to an unforseen roadblock on the side you chose to ignore. Taking a holistic approach allows a greater likelihood of success.(3) Improving efficiency but not at the cost of quality Out poster child, Toyota has unfortunately shown us that despite incredibly efficient processes and design practices that weed out waste at every opportunity, it is the intelligent handling of situations that require the development of employee skills that can not be automated. If you do not develop employees to think outside the production-line, you may miss opportunities for additional improvement in quality of the product or service delivered to your customer.A Proven SystemYou may ask, how do we know that combining approaches works, or that not combining them may lead tomissed opportunities? Some more commonly reported examples may help.Visit us at: Contact us at: Speak to us at: 9 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  10. 10. Work better. GetOne example for us to consider is 3M, for what happens when organizations pick just one option and chaseit to its extreme. Studies have suggested that the unrelenting pursuit of Six Sigma in the research areasactually hindered innovation. Six Sigma, as a process improvement methodology is extremely heavyweight,and is not a good fit for every type of organization. As such, 3M demonstrates the risk of betting heavily onjust one approach to improving a business, even if it has been a resounding success elsewhere.We are unlikely to find well publicized examples of employee development causing an organization toactually decrease performance. Increasing employee engagement is likely to be positive whenever applied.That said, if we consider an organization with chaotic processes, its likely that the newly engaged, smartemployees will be looking around them for new ways to improve the business. Process improvement maywell be one approach they pick. If the business resists, we can expect that the employees will either startlooking for opportunities elsewhere, or will slide back to a state of low performance. As outsiders looking in,we probably wouldnt attribute this to failure of employee development, just failure of the organization tochange.Despite the recent issues, a really strong example of process improvement and people improvementworking together is in the Toyota Production System (TPS). The TPS not only requires continuousimprovement of processes, it also reinforces the concept that organizations add value by developing itspeople. The TPS says: 1. Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others. 2. Develop exceptional people and teams who follow your companys philosophy. 3. Respect your extended network of partners and suppliers by challenging them and helping them improve.Toyota believes that the work team supervisors who are working directly with the production workers areexceedingly important to continuous business improvement, since they are so directly attached to theoperations that they constantly influence quality, cost, productivity and morale of their teams. Developingthese people is therefore core to the success of any process improvement project.Visit us at: Contact us at: Speak to us at: 10 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  11. 11. Work better. GetHunting for a R are BeastSince we struggle to find examples of pure services companies that excel at process improvement,we are likely to believe that a services company excelling at both processes and employee development isa truly rare beast.The place for us to search is with the companies that claim they can run your processes better than youcan: companies that offer business process outsourcing (BPO). Looking at it this way, any company thatcan demonstrate its ability to run your business processes better than you while simultaneously servicingyour customers better than you do, had better be using proven approaches to process improvement andemployee development.One example we can find to support the point is the Indian BPO firm, Wipro. The firms long-standingimplementation of Six Sigma is well know, and their standing as an excellent place for employees supportsthe claim of great organizational development programs. In fact any credible outsourcing company willhighlight a range of quality and development certifications that typically come from employee education inprocedures and methodologies.It seems that BPO firms could be a strong example of the value of employing process improvement andorganizational development simultaneously. We might even argue that BPO offers an option for shortcuttingthe overall business improvement endeavor, by having someone do it for you. The question then is whetheryou are willing to pass your important, maybe critical business process to another company? We all knowthat the answer to this also depends on if you feel that these processes define your company in the sameway that building cars defines Toyota.No Gambling, Just StrategyWhen starting out, a pragmatic, lightweight approach to business improvement is essential. It is not untilyou try process improvement or leadership and organizational development in your organization that youwill see how, or even if, it will work well for you. Investing heavily up front in one methodology or anothermay lead you to get stuck with it, because it is emotionally and politically hard to back away from theVisit us at: Contact us at: Speak to us at: 11 of 12www.consected.com/double-down info@consected.com (617) 500-8195
  12. 12. Work better. Getinvestment you have already made.Despite this, we should also consider the impact of trying to do everything yourself to keep the investment(and therefore perceived risk) low. It is important to use resources with an open mind to help you lookobjectively at what is going on, what doesnt work and what is really good enough for now. Working withconsultants from outside the organization can give you this outside in view, while bringing experience fromother organizations with similar business problems.Trying to do it yourself and achieve the full benefits from the synergies of process improvement andorganizational development can be like a vacation gambler taking a trip to Vegas with the dream ofreturning home rich. We all understand the outcome.If you are not ready to start tampering with your business processes, instead relying on employeedevelopment as your first tool for business improvement, try apply some of the thinking of Lean. Evaluatethe results of your project, to see if you got the benefits you had planned, then dont treat that as the end-game.Take a step back after every project and assess where the new issues and opportunities for improvementlie. Dont blindly say to yourself, “well, it worked last time, so well just do the same again”. Take a holisticapproach. Removing a pain-point in one area could highlight an issue in another area completely. So beready to mix the strategies you use, double-down when it makes sense, and youll undoubtedly see awinning hand every time.© Copyright Consected, 2009Visit us at: Contact us at: Speak to us at: 12 of 12www.consected.com/double-down info@consected.com (617) 500-8195

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