Successful Business Process Management

Paula Berman

• Editorial: AMACOM
• Año: 2014
• ISBN:
  9780814434024
• Categoría: Business
• Categoría: Operations

This book has done all the homework for you and provides a succinct, accessible overview on the training and tools available for process improvement that fills that gap of being not too rigid nor too blasé.

Too few standard procedures within an organization and inefficiency will inevitably ensue. But too many, and creativity is stifled. This catch-22 is enough to make heads spin! How does one settle on the perfect mix that will streamline activities and create smooth workflows?

In Successful Business Process Management, you will discover step-by-step instructions that explain how to:

• Overcome resistance and apathy to standard procedures
• Take a systematic rather than ad hoc approach to process management
• Design key processes and capture them in documented procedures
• Revise existing processes when feasible
• Roll out the changes so people know what to do
• Embed them in the organization for reliable outcomes

With the increasingly complex organizations of the twenty-first century, it is vital that companies have standard, documented processes and procedures in order to achieve high levels of quality and productivity--yet they can't afford to dampen the innovation that got them on the map in the first place. Successful Business Process Management will show you how to get it just right.

PART ONE

Reviewing the Definitions

CHAPTER 1

Understanding Processes and Procedures

LET'S START FROM THE VERY BEGINNING, with definitions of some essential terms. This is an important thing to do any time you're working on process documentation. Words are all you have to convey your ideas, but in many cases people understand the same words in different ways. That's especially true for seemingly simple terms like “process.” You don't want to learn, several days or weeks into a project, that the conversations you thought you were having sounded very different to the other people involved. Thus, clear definitions are critical to getting everyone on the same page.

Once we have a shared understanding of processes and related topics, we can go on to consider why they're important. Obviously, I think processes matter, as a way of conducting business effectively. You probably do too, since you're reading this book, but we need to be specific about how they matter and what aspects of them are important in order to ensure that our processes realize the goals we have for them.

WHAT ARE PROCESSES AND PROCEDURES?

The terms “process” and “procedure” get used a lot, sometimes interchangeably, and sometimes to mean very different things. “Work instruction” is another phrase that can carry subtly different meanings. For this reason, I'm providing my definition of these terms below. When you read any book or article on the topic of process improvement, it's important to check the definitions to make sure you understand what the author means.

What Is a Process?

A process is a set of interrelated activities designed to transform inputs into outputs. It gets you from where you are to where you want to be. An effective process realizes planned activities and achieves planned results. If you've been working with processes, you probably already understand this concept, but we need to agree on definitions for the terms involved in the process in order to be able to discuss and analyze it.

• An input is what you already have or expect to receive in time to start a step/activity. An input may be intangible, such as time, a customer's need, or an engineer's expertise, or it may be a physical object, such as a raw material or part. It may include something that will be changed in some way during the course of the process, such as a component that will be assembled into a final product, or it can include a resource that will not be changed, such as money or a piece of factory equipment.
• An output is what you want to deliver to the customer so the next step/activity can proceed. (The customer of a process may be internal—within your company—or external—the end customer who is paying for your product or service.) In the process of selling an ebook to a customer, the input is the book file and the customer's computer or e-reader plus money and an Internet or mobile-phone delivery system, and the output is the book file that resides on a device from which the customer can read it. As you can see in this example, not all outputs are tangible or physical objects. However, outputs do need to be measurable. An output of a customer relationship process could be customer satisfaction, but that needs to be measured by customer surveys or other methods.
• A trigger is the signal for a process to start. It may be time-based (a yearly audit), condition-based (a restock for a vending machine whenever it indicates that it is low on supplies), or based on the completion of another process (an installation of wheels on a toy car after the chassis is painted).
• A process always has a customer, but the customer (as stated above) may be either external or internal. The simplest way to say it is that the customer is whoever needs the output of the process.

For example, the process by which an engineer designs a component is triggered by the need for a new component. (The old one may be faulty, or a new product design may require entirely new components.) The inputs include customer requirements and data of raw materials, plus any applicable standards, design tooling, time, and expertise. The output is a finished and documented design. The customers are other engineers and techs who will use the design to build the new product. During the process, the engineer converts the customer requirements (which could be in a customer's head or could come from market analysis) into measurable technical requirements, creates a design, verifies that it meets those requirements, and then validates the design by building and testing a prototype. Those activities make up a process.

What Is a Procedure?

A procedure is a way of carrying out a process or activity. It outlines who performs the process activities and in what order and provides other relevant information (though a higher-level procedure does not provide step-by-step instructions to perform each task). In this book, I always use the term “procedure” to refer to a standardized, documented set of ordered activities, and the term “process” to refer to the set of activities documented in a procedure.

A procedure document generally consists of a process map—a graphical representation of the steps in a process and how they fit together—plus supporting explanation and other needed text. Process maps can be nested: that is, one box in a higher-level process map can be developed into a whole lower-level process map of its own. The rest of a procedure document explains its scope and goals and provides more information about each step in the process map and who performs it, as well as any other necessary information, such as roles and responsibilities, records, or references to related documents.

The lowest-level procedures, often called work instructions, define specifically how to perform a task in detail, step-by-step. Work instructions are always documented and are generally carried out by one person or a small team. Unlike other procedures, very linear work instructions may not need process maps.

WHAT IS A PROCESS SYSTEM?

A process system is a model of the business, showing how processes fit together to meet the goals of the company. It provides a structure in which work instructions fit into processes, and processes fit together to describe the working of the business as a whole. A process system is a powerful tool for understanding the working of the business and improving it, by spotting gaps where work isn't getting done correctly or identifying inefficiencies where more resources are used than are needed.

Processes are interconnected because the output from one process becomes the input for another process. In effect, processes are “glued” together by means of such input-output relationships. It is not unusual to learn that one department values and depends on inputs that another department does not take seriously and has no standard processes to produce. Creating the process system can provide the impetus for important and necessary conversations between different groups.

A process system generally has some kind of overview of the system at the top level, with a hierarchy of increasingly detailed procedures below that. This top-level overview may be contained in a Quality Manual, the document defining a company's quality policy and quality system. Typically, the Quality Manual contains a statement of the company's commitment to quality, top management's responsibilities, an overview of the process system and other systems for ensuring quality in the company's products or services, and an explanation of how relevant quality standards are met.

WHAT ARE PROCEDURES FOR? (OR WHY SHOULD YOU BOTHER?)

In many companies, if you ask average employees what their standard procedures are for, you might be get answers like: “To keep the quality people happy,” “To get in the way of real work,” “I don't know but management wants them,” or even “So we can be certified to the ISO 9001 standard.”

This is bad.

Having procedures for the sake of being able to say you have them is waste. (“Waste” is defined as spending time or other resources on activities that do not contribute directly to the product, including service products, or not doing something correctly the first time.) If an activity can be removed without detriment to the company's long-term goals—including quality products/services, satisfied customers, and thriving employees—it is waste. Unused procedures run through paper, digital storage space, and, most of all, time. As Benjamin Franklin said, “Do not squander time, for that is the stuff life is made of.” It's also the stuff a business is made of. If you're wasting time creating unused procedures, you're not doing something more useful.

Well-chosen standard business processes, captured into documented procedures and deployed effectively, provide real value to the organization in lots of different ways:

• They provide a model of the business. At the highest level, a process system provides a model of how an entire business operates. This model and the processes that constitute it ensure that everyone in the company is working from the same basic assumptions of how the company functions.
• They offer a concrete path to follow to meet the business's core mission. Many businesses say that they want to satisfy the customer's needs with world-class products or services, or words to that effect. The right procedures can supply the concrete steps to follow to ensure that daily operations are carried out in a way that is consistent with your goals.
• They ensure that interfaces are agreed upon. Procedures serve as interface agreements between company divisions, departments, teams, and individuals. Defining the inputs and outputs of each process, and mapping how the processes fit together, allows you to find gaps, identify waste, and create more efficient ways of operation.
• They multiply expertise, helping new employees to become productive faster. A detailed work instruction created by an expert to clearly document how he performs a standard task can then be followed by someone with less knowledge and experience. The procedure can also tell newer or less experienced employees where to find the other information they need to do their work. This is especially critical in cases where you are expanding rapidly and bringing in many new people or when you have high employee turnover. It also means that your experts can simply refer people to the appropriate procedure, instead of having to answer every question themselves.
• They standardize ways of working. Making sure everyone who performs this process has the same understanding of it and performs it in the same way is critical. It's often true that there's more than one right way to do it—but since there are always even more ways to do it wrong, it's valuable to choose one of those right ways (the best one, if there is such a thing) and make sure everyone follows it. This single way of working reduces variation in the outputs of the process, making them more consistent, which then helps to further processes down the line.
• They allow improvements. There's a saying that “You can't improve what you don't measure.” It's not entirely true, but if you don't thoroughly understand your process, you'll never know if you actually did improve it, or by how much. “Measure” in this case means not only taking metrics but also understanding what the current process is—not just what it's supposed to be, but what it really is. The basic steps of process improvement are to determine what your goals for the process are, study the existing situation, analyze where it falls short, and then make improvements and measure them.
• They avoid single points of failure. If important company processes that are not standardized and documented are carried out by only one person (or just a few people), and then if that expert leaves the company or is out sick, the process has to be reinvented by others. Meanwhile, paychecks or orders can be delayed, or errors can be made that take months to correct or even find. (This sounds extreme, but it's based on a real-life example.)
• They offer assurance of quality to your customers. As customers grow more demanding in business areas where quality is critical, they may ask to be shown your process system in order to be assured of your quality of production and service.
• They pass certification audits. This includes audits for certification of compliance with industry standards, such as ISO 9001, ISO 14001, AS9100, and SAE. Note that this item is listed last. I believe that passing audits and gaining certification are properly a byproduct of a good working process system, not the main goal. However, ISO 9001 and other such standards are actually good and reasonable documents. If you're starting to build a process system from scratch, they can offer useful guidance to what you need.

WHEN IS A PROCESS OR PROCEDURE NEEDED?

Actually, a process is always needed because it consists of the activities you do that get you from “work undone” to “work done.” What you don't always need is a standardized, documented process—a procedure.

You need a procedure:

• When you have multiple people or groups of people whom you want to perform an activity in the same way. This especially applies when some of those people have less training and expertise than others, and you want them to be able to perform to the same specifications.
• When you need to train new employees in how to perform a standard task.
• When a process is complex and its output is critical, either because it's delivered to an external customer or because it's the input to another process.
• When the procedure is required by your standards or by your own business model.
• When you need the ability to have a business-critical process performed by people who don't usually do it, in case of illness, vacation, or an emergency.
• When people who are not performing the work (e.g., managers) need to understand the process.
• When you need to improve a process in a measurable way.

WHEN IS A PROCEDURE NOT NEEDED?

You don't need a documented procedure for simple actions that are performed by a single experienced individual, though it may still be useful to have validation tests or templates for some outputs. You also don't always need a procedure to produce some outputs that are used only internally by a small organization, though in many cases it may be useful to have one.

You don't need a complete procedure when a simple checklist will do. You don't need low-level, detailed instructions for every action, either. Document your procedures to the level of detail that is useful, and no further.

Use the following checklist to determine when a procedure is needed:

• Will anyone ever look at the procedure again?
• Will it be used for training?
• Do you often have new people who need to be trained?
• Is the process so critical to the business that it must be done perfectly?
• Would it...