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Digg it UP - Adopting a Business Process Approach to Management - 6 Critical Steps
Because prices and even the price of education are rising steadily, most families with average income need to have both parents work to keep up with their lifestyle. One parent of average income working and providing for his family by himself does not bring enough money to the table. So for a family who wants to live comfortably with enough savings, both parents have to work to provide for the whole family. The time will come that work and family will blend. As I look at it, this blurring is brought about by three factors namely; the need of the family to have a decent income to support their families, technology advancement that makes it impossible for parents to enjoy time with their family and a decrease in job security which means that more parents are thinking of sta
It is well known that measurements and rewards drive behaviour. To ensure proper balance between focus on past/current performance, and the need to build capabilities that drive future success, we need metrics that track results, processes, organisational capability and the environment.
Result measures are generally lagging in that they track past performance. By the time the result is measured, it is too late to do anything about it. Process measures are generally leading and prescriptive, since they predict future performance. Acting on factors that affect these measures will impact on future results. Care must be taken that metrics which drive the desired behaviour and customer valued outcomes are selected.
Having determined the
Risks are an inherent part of every undertaking. Getting up in the morning has it’s risks but we don’t think about them in a structured since, we just accept it and go on with the day. As the things we do get more complicated the number and amount of risk increases. Such is the case with most projects undertaken in the business world. Does this mean that we should ignore the risks and go on with the day or does it mean we should spend time worrying or fussing over each risk. Approaching the situation in either fashion doesn’t constitute risk management and will end up doing more harm than good, personally and professionally.A good risk management effort begins by thinking about risks in terms of them happening (probability) and damage done if the risk is realized (
In our previous article we emphasised the customer/stakeholder focus of the business process approach to management. The first step is therefore clearly determining who those customers and stakeholders are. Who buys or uses your product or service offering? Who makes the buying decision? What exactly are they buying in terms of benefits? Who else is affected by your activities and what are their expectations?
A small pharmaceutical manufacturer of multivitamins, antibiotics, syrups and OTC medicines for children, located in a large African city, was trying to answer these questions for their own organisation. They came up with the following.
Customer/Stakeholder and Benefits Sought
2.Determine the Value Chains that Deliver these Benefits
The information obtained from the above step should be formed into benefit clusters. Next, trace those benefits back from your products and services through to the inputs. The identified paths form your value chains or end to end core business processes.
Our pharmaceutical company took this step and concluded they had one major value chain consisting of two major processes - the new pharmaceuticals development process and the sales and production process.
All the benefits to the customers and other stakeholders are derivable from their product range, their distribution and market support and their information dissemination.
3. Decompose into Processes and Determine the Process Boundaries
The previous step yields an end-to-end view of the organisational value chains. We now need to determine the core processes and sub-processes that make up these value chains, and the support processes that enable them. The determination of process boundaries should combine top-down and down-up approaches applied iteratively.
Listing out the major processes in the value chain as we did in the previous step, is top-down. We might then take each major process identified and using the following procedure suggested by Patrick and McDermott, break them down into sub processes.
In the case of the pharmaceutical for example, we might find, after going through this sequence that the sales and production process decomposes into the customer acquisition (identify prospect, qualify prospect and establish contract) and order fulfilment (receive order, produce and assemble order, and ship order) sub-processes.
4. Select Appropriate Metrics Based on Critical Success Factors for the Identified Processes and Overall Strategy
It is well known that measurements and rewards drive behaviour. To ensure proper balance between focus on past/current performance, and the need to build capabilities that drive future success, we need metrics that track results, processes, organisational capability and the environment.
Result measures are generally lagging in that they track past performance. By the time the result is measured, it is too late to do anything about it. Process measures are generally leading and prescriptive, since they predict future performance. Acting on factors that affect these measures will impact on future results. Care must be taken that metrics which drive the desired behaviour and customer valued outcomes are selected.
Having determined the c
I was reminded of this story by Trish, a former colleague. I hadn’t forgotten, because it was the catalyst for a new career advancement strategy I developed. In my various human resource roles I always advise my clients to consider a range of self promotion strategies to advance their career. As a result of the case study below, I developed a new strategy to take the initiative to keep their own company employee file updated by ensuring the Human Resource Department received and recorded in their employee file a pr?cis of any new skills, qualifications or experience they had gained. This is important if they don’t want to be overlooked for promotion, considered for special projects, receive appropriate remuneration, receive a good and accurate reference, and as we will see in
2.Determine the Value Chains that Deliver these Benefits
The information obtained from the above step should be formed into benefit clusters. Next, trace those benefits back from your products and services through to the inputs. The identified paths form your value chains or end to end core business processes.
Our pharmaceutical company took this step and concluded they had one major value chain consisting of two major processes - the new pharmaceuticals development process and the sales and production process.
All the benefits to the customers and other stakeholders are derivable from their product range, their distribution and market support and their information dissemination.
3. Decompose into Processes and Determine the Process Boundaries
The previous step yields an end-to-end view of the organisational value chains. We now need to determine the core processes and sub-processes that make up these value chains, and the support processes that enable them. The determination of process boundaries should combine top-down and down-up approaches applied iteratively.
Listing out the major processes in the value chain as we did in the previous step, is top-down. We might then take each major process identified and using the following procedure suggested by Patrick and McDermott, break them down into sub processes.
In the case of the pharmaceutical for example, we might find, after going through this sequence that the sales and production process decomposes into the customer acquisition (identify prospect, qualify prospect and establish contract) and order fulfilment (receive order, produce and assemble order, and ship order) sub-processes.
4. Select Appropriate Metrics Based on Critical Success Factors for the Identified Processes and Overall Strategy
It is well known that measurements and rewards drive behaviour. To ensure proper balance between focus on past/current performance, and the need to build capabilities that drive future success, we need metrics that track results, processes, organisational capability and the environment.
Result measures are generally lagging in that they track past performance. By the time the result is measured, it is too late to do anything about it. Process measures are generally leading and prescriptive, since they predict future performance. Acting on factors that affect these measures will impact on future results. Care must be taken that metrics which drive the desired behaviour and customer valued outcomes are selected.
Having determined the
Venture capital finance is instrumental in inducing technological development, stimulating creativity and innovation and nurturing entrepreneurship. Concerted efforts are required by financial institutions, private sectors and other agencies to create a conducive environment for the growth of venture capital. In particular, initiatives are required to widen the perspective of venture capital finance and create a favorable fiscal and regulatory environment.The venture capital schemes of the term-lending financial institutions presently focus mainly on supporting development of technology and implementing indigenously developed yet untested technologies. While this concern is understandable because of a genuine need for expanding the base of viable indigenous technology,
All the benefits to the customers and other stakeholders are derivable from their product range, their distribution and market support and their information dissemination.
3. Decompose into Processes and Determine the Process Boundaries
The previous step yields an end-to-end view of the organisational value chains. We now need to determine the core processes and sub-processes that make up these value chains, and the support processes that enable them. The determination of process boundaries should combine top-down and down-up approaches applied iteratively.
Listing out the major processes in the value chain as we did in the previous step, is top-down. We might then take each major process identified and using the following procedure suggested by Patrick and McDermott, break them down into sub processes.
In the case of the pharmaceutical for example, we might find, after going through this sequence that the sales and production process decomposes into the customer acquisition (identify prospect, qualify prospect and establish contract) and order fulfilment (receive order, produce and assemble order, and ship order) sub-processes.
4. Select Appropriate Metrics Based on Critical Success Factors for the Identified Processes and Overall Strategy
It is well known that measurements and rewards drive behaviour. To ensure proper balance between focus on past/current performance, and the need to build capabilities that drive future success, we need metrics that track results, processes, organisational capability and the environment.
Result measures are generally lagging in that they track past performance. By the time the result is measured, it is too late to do anything about it. Process measures are generally leading and prescriptive, since they predict future performance. Acting on factors that affect these measures will impact on future results. Care must be taken that metrics which drive the desired behaviour and customer valued outcomes are selected.
Having determined the
Business-valuation is nothing simple. Every person out there will think that a business is worth more or less than what the next person will say. In fact, the only number that really does matter is the simple fact that it is worth what someone will pay for it and that number only occurs once the deal is done. But, there are ways of understanding what business-valuation could be. For that end, we will talk here.• Capitalized Earning. This is one approach to understanding the value of a business. What we are talking about here is the value of the return on the investment in a company as determined by an investor. It works by evaluating the risk that is involved with any investment. • Excess Earning. This method of business-valuation is quite similar but it
In the case of the pharmaceutical for example, we might find, after going through this sequence that the sales and production process decomposes into the customer acquisition (identify prospect, qualify prospect and establish contract) and order fulfilment (receive order, produce and assemble order, and ship order) sub-processes.
4. Select Appropriate Metrics Based on Critical Success Factors for the Identified Processes and Overall Strategy
It is well known that measurements and rewards drive behaviour. To ensure proper balance between focus on past/current performance, and the need to build capabilities that drive future success, we need metrics that track results, processes, organisational capability and the environment.
Result measures are generally lagging in that they track past performance. By the time the result is measured, it is too late to do anything about it. Process measures are generally leading and prescriptive, since they predict future performance. Acting on factors that affect these measures will impact on future results. Care must be taken that metrics which drive the desired behaviour and customer valued outcomes are selected.
Having determined the
The precise start is always difficult to pin down. Typically trouble is not recognized until slipping revenues and eroding profits span two or more calendar quarters. These are difficult problems and catch many managers unprepared to deal with the rapidly deteriorating situation. These problems are symptoms of many underlying problems. These underlying problems are often unrecognized or simply overlooked as the financial slide gets worse.What causes a good company to go bad? It can be anything or any combination of things that began the all too quick slide into financial trouble.Way posts on the journey include nervous bankers, demoralized employees, defection of competent players and strained resources. The temperature is rising faster than revenues and profits
It is well known that measurements and rewards drive behaviour. To ensure proper balance between focus on past/current performance, and the need to build capabilities that drive future success, we need metrics that track results, processes, organisational capability and the environment.
Result measures are generally lagging in that they track past performance. By the time the result is measured, it is too late to do anything about it. Process measures are generally leading and prescriptive, since they predict future performance. Acting on factors that affect these measures will impact on future results. Care must be taken that metrics which drive the desired behaviour and customer valued outcomes are selected.
Having determined the critical factors that drive delivery of customer and stakeholder metrics or indicators of performance must be chosen, with targets for each measure, and cascaded down to individual sub processes. A line of sight must exist between overall organisational measures and the detailed measures at process and activity level.
Our pharmaceutical company chose to measure four categories. At the top level, the chosen metrics were:
5. Appoint Process Owners for Each Core Process
A major flaw of the functional orientation is that there is no one within the organisation that has a complete view of the process as experienced by the customers and stakeholders. The appointment of process owners overcomes this flaw.
The job of process owner is to manage the processes in the critical areas of improvement, boundary management, metrics, collaboration and advocacy. The process owner coordinates the functions and activities at all levels of the process, and has the authority and ability to makes changes to the process. He is responsible and accountable for its outcome.
6. Begin a Never Ending Cycle of Business Process Improvement
With your core processes defined and documented, appropriate metrics selected and process owner appointed, the next step is to begin an improvement cycle.
Using process diagrams, value stream maps and metrics, determine the current capabilities of your core processes. Identify and quantify areas of greatest opportunity using information from customer surveys, comparison of your process performance with a similar ideal process, etc.
Continuous business process improvement is the subject of our next article. Be sure to watch out for it.
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