Process Improvement and Management (PI&M)
Encyclopedia
Identify, analyze and improve the Key Processes
According to Rummler (1996) an organizationOrganization
An organization is a social group which distributes tasks for a collective goal. The word itself is derived from the Greek word organon, itself derived from the better-known word ergon - as we know `organ` - and it means a compartment for a particular job.There are a variety of legal types of...
is only as good as its processes. To be able to make the necessary changes in an organization, one needs to understand the key processes of the company. Rummler and Brache (1991) suggest a model for running a Process Improvement and Management project (PI&M), containing the following steps:
1. Identify the process to be improved (based on a critical business issue).
The identification of key processes can be a formal or informal exercise. The management team might select processes by applying a set of criteria derived from strategic and tactical priorities, or process selection is based on obvious performance gaps. It is important is to select the process
Business process
A business process or business method is a collection of related, structured activities or tasks that produce a specific service or product for a particular customer or customers...
(es) which have the greatest impact on a competitive advantage or customer requirement.
2. Develop the objective(s) for the project based on the requirements of the process.
The focus might be on quality improvement, productivity
Productivity
Productivity is a measure of the efficiency of production. Productivity is a ratio of what is produced to what is required to produce it. Usually this ratio is in the form of an average, expressing the total output divided by the total input...
, cost
Cost
In production, research, retail, and accounting, a cost is the value of money that has been used up to produce something, and hence is not available for use anymore. In business, the cost may be one of acquisition, in which case the amount of money expended to acquire it is counted as cost. In this...
, customer service
Customer service
Customer service is the provision of service to customers before, during and after a purchase.According to Turban et al. , “Customer service is a series of activities designed to enhance the level of customer satisfaction – that is, the feeling that a product or service has met the customer...
or cycle time. The goal is however always the same; to get the key process under control.
3. Select the members of the cross-functional team.
A horizontal (cross-functional) analysis is carried out by a team composed of representatives of all functions involved in the process. While a consultant or in-house staff person can do the job, the quality of the analysis and the commitment to change is far greater with a cross-functional team.
4. Document the current process by creating a flowchart or "organization map."
Describe the process regarding the Organizational level, the Process level and the Job/Performer level according to Rummler (1996). Develop a cross-functional process map for the process.
5. Identify "disconnects" in the process.
“Disconnections” are everything that inhibit the efficiency and effectiveness of the process. The identification should be categorized into the three levels: The Organizational level, the Process level and the Job/Performer level.
6. Recommend changes (organizational, in the process or in its execution).
Categorize and prioritize the main problems and possibilities, evaluate alternative solutions. Develop a cross-functional process map for the recommended process.
7. Establish process and sub-process measures.
The process measures should reflect the objectives of the project.
8. Implement the improvements.
The elements of a successful implementation effort
- Executive leadership and management commitment to see the project through to successful implementation.
- A clear statement of why the change is necessary.
- A clear vision of how the organization will be different after the changes.
- Sound, comprehensive recommendations.
- A sound implementation strategyStrategyStrategy, a word of military origin, refers to a plan of action designed to achieve a particular goal. In military usage strategy is distinct from tactics, which are concerned with the conduct of an engagement, while strategy is concerned with how different engagements are linked...
and planPlanA plan is typically any diagram or list of steps with timing and resources, used to achieve an objective. See also strategy. It is commonly understood as a temporal set of intended actions, through which one expects to achieve a goal...
.
- Adequate resources and time.
- Communication of plans, roles and responsibilities, benefits, progress, resolutions.
- Willingness of affected functions and individuals to support the proposed changes.
- Implementation is effectively managed and executed.
This model for process analysis is just as useful for smaller processes as for larger and more complex processes. Completion of Steps 4-7 can take from three days to three months, depending on the complexity of the process and the extent of change required to remove the disconnects.
Some of the benefits of this cross-functional team approach to process improvement are that the participants learn a tremendous amount about the overall business and their role in it. People earlier seen as unskilled might suddenly understand what is required from them, and will start behaving according to this. The increased understanding of the process will also increase the learning from additional formal training initiated, but also reduce the amount of training needed. When the organization finally understand what their key processes are they will more easily feel committed to the implementation of improvements.
Ongoing Process Improvement and Management (PI&M)
Ongoing Process Improvement and Management can be introduced by:- Monitoring its performance against customer-driven process measures.
- Certifying the process (ensuring that it meets a set of effectiveness criteria).
- Appointing a process owner who is responsible on an ongoing basis for process performancePerformanceA performance, in performing arts, generally comprises an event in which a performer or group of performers behave in a particular way for another group of people, the audience. Choral music and ballet are examples. Usually the performers participate in rehearsals beforehand. Afterwards audience...
.
- Ensuring that the processBusiness processA business process or business method is a collection of related, structured activities or tasks that produce a specific service or product for a particular customer or customers...
has a plan and a budgetBudgetA budget is a financial plan and a list of all planned expenses and revenues. It is a plan for saving, borrowing and spending. A budget is an important concept in microeconomics, which uses a budget line to illustrate the trade-offs between two or more goods...
.
- Creating a reward system which encourages process (as opposed to parochially functional) effectiveness.
- Managing the white spaceWhite spaceWhite space may refer to:* White space , portions of a page left unmarked** Space , the space between two words of text* Whitespace character, a computer character for the space between words...
between functions and seeing that their subordinate managers do the same.
The system framework of PI&M can be used both to improve the flow of a specific process and at the organizational level to examine general management issues. By introducing PI&M as a standard for continuous improvement, employees are given clear guidance as to how they are expected to behave. By this she would create clear values for a company that will have a good chance of being accepted by the whole organization.
See also
- Business Process MappingBusiness Process MappingBusiness process mapping refers to activities involved in defining exactly what a business entity does, who is responsible, to what standard a process should be completed and how the success of a business process can be determined. Once this is done, there can be no uncertainty as to the...
- Business Process ReengineeringBusiness process reengineeringBusiness process re-engineering is the analysis and design of workflows and processes within an organization.According to Davenport a business process is a set of logically related tasks performed to achieve a defined business outcome....
- Process ManagementProcess managementProcess management is the ensemble of activities of planning and monitoring the performance of a process. The term usually refers to the management of business processes and manufacturing processes...
- Six SigmaSix SigmaSix Sigma is a business management strategy originally developed by Motorola, USA in 1986. , it is widely used in many sectors of industry.Six Sigma seeks to improve the quality of process outputs by identifying and removing the causes of defects and minimizing variability in manufacturing and...