The reasons a business fails to design and run responsible, effective process improvement programs are not all that mysterious. A review of the literature suggests that, in the aggregate, three characteristics tend to mark the programs that fall short of the mark.
If Paul Nutt is right that two-thirds of all business decisions are based on failure-prone tactics, think back to your last four decisions. If even two of them made a positive difference, you have already beaten the odds.
The three failings are:
- A failure to win not just top management’s support but its active involvement
- A failure to identify and concentrate on the processes that matter
- A failure to define a business’s desired state before launching a program that alters its current state
So what is the value of knowing where a problem comes from when solutions are so plentiful? Just this. If you can identify a common thread that clarifies or mitigates the source of a problem, you can usually identify a reasonable and effective solution as well. Let us look at that idea for a moment.
Senior management support
The involvement of senior management and the cooperation of the wider culture are generally won through a deliberate exchange of information. For the greatest effect, management has to explain, endorse, and encourage the effort repeatedly and forcefully. At the same time, to earn and secure cooperation, the rest of the organization needs to hear from management about the specific benefits of process improvement and the consequences of doing nothing. But how do you identify the right information, and how do you convince both sides that their claims hold up? We will come back to that.
Concentrate on the processes that matter most
The second source of error is a failure to identify which processes matter most, and therefore where the greatest improvement effort belongs. Research shows that improving just any process is not enough. For the biggest gains in effectiveness, efficiency, and contribution, you should focus on the processes that hold a prominent place in the value chain. But how do you know which ones those are, what each contributes, and what effect a change in each would produce? We will come back to that question too.
Knowing the end from the beginning
“The results have been outstanding… cycle times and costs have both decreased dramatically. ProcessModel has allowed lenders across the country to create a business case that is so compelling, that even in the face of organizational resistance senior management is motivated to transition their organizations from the old to the new.” - Tony Cato, Fannie Mae
The third source of error is a business’s inability, reluctance, or unwillingness to pinpoint where it wants to go before it leaves where it is. As an old sage once quipped, “If you don’t know where you want to go, any road will do.” Unfortunately, that is usually the pattern when no destination is set in advance. So how does a business decide where the best destination is, or whether that destination is even reachable with the resources at hand? Good question.
What do all of these questions have in common? One thing. In every case the answer lies in the collection, evaluation, and dissemination of specific information about the business, its processes, and the impact of change. But it is not that simple either. A business setting out on process improvement has to answer each question in a way that fits its aims while weighing a wealth of alternatives, any one of which could spell the difference between success and failure. That is exactly the kind of question a tested process model is built to answer. For a broader view, see simple ways to improve business processes or take a closer look at the product.
About Paul C. Nutt
Paul C. Nutt is a professor of Management Sciences and Public Policy and Management in the Fisher College of Business at Ohio State University. He is the author of six previous books on transformation, leadership, strategic management, planning, decision making, evaluation, and re-engineering, including Making Tough Decisions and Managing Planned Change.
Book references:
- “Why Decisions Fail,” Nutt, Paul, Berrett-Koehler, 2002
- “Achieve Lasting Process Improvement: Reach Six Sigma Goals without the Pain,” Bennet, L. & Rea, K., Sutton Books, 2003
- “2001 Professional’s Guide to Process Improvement: Maximizing Profit, Efficiency and Growth,” Lientz, B. & Rea, K., Harcourt Brace Professional Pub., 2000
- “Five Critical Questions in Process Improvement,” Waina, R. CHIPS, Summer 2001 to Spring 2002
