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05/07/2012 10:54 AM
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Hi all,
I'm curious to one thing, and I was hoping for input from you skilled people here.
To avoid boiling the ocean, we need to categorize our processes. Typically, they would be called "core", "enabling", "supporting" etc.
My question: what categories do you use, and how do you define each category?
Thank you,
Attila
Oslo, Norway
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05/10/2012 04:10 PM
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Hi Attila
I prefer the most simple way possible just like define activities and actions, Value Added, Non-value Added but required, and Non-value Added Waste. Support and enabling processes do not create value only a core processes that produces a product or service for a customer can, thus the others are things that may or may not be needed, and reducing them can help you cut cost and compete. Even items that are value added you should look at to see if they generate more revenue than expense (not all value is created equally).
Live Lean and Prosper
Robert Drescher
ELSE Inc.
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05/14/2012 02:59 PM
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In this context, as in many others, it may help to depict your many processes on a Decision Landscape. The y-axis is RELATIVE IMPACT and the x-axis is RELATIVE CHALLENGE. In this case Impact would probably = VALUE. Several factors might go into that determination. Challenge would be a weighted score that captured factors like complexity, ability to change, effort required to change, specialized skills, time to implement. Ranking each process RELATIVE to the others aids in overcoming the "boil the ocean" issue you note.
Depicting the various processes on a bubble chart makes the relative positions visible and easier to explain. You can pick one "lens", like time to implement, to drive the size of the bubbles. A strategy or plan usually incorporates several of the elements depicted in this multi-dimensional decision landscape.
The dialog with your team about the IMPACT and CHALLENGE factors, weight and then ranking of various processes can improve understanding and the alignment needed for coordinated action. Once the processes are arrayed on the matrix, the team can consider the 4 quadrants - Strategic [high impact / high challenge], Low hanging fruit [high impact / low challenge], distractions [low impact / low challenge], and waste of effort [low impact / high challenge]
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05/14/2012 02:59 PM
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Hello Attila
I utilize Forrest Breyfogle's approach in his Integrated Enterprise Excellence methodology where there is simply a main value chain (not a value stream, these sit beneath the organizations top-level value chain) and supporting processes.
For example, research and design, marketing and selling, production, shipping, etc. are part of the main value chain, while finance and human resources while not participating directly in value creation for the customer, do contribute as supporting processes.
Within the various value streams sit value added and non-value added steps, however this is a lower level of assessment.
Kevin Ryan
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05/14/2012 02:59 PM
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Attila,
To me, this is at the heart of any successful lean transformation; breaking existing paradigms about current organization structures and replacing them with relationships that are process-based. Remember, the organization is a HOW, not a WHAT. As such, it should be subject to the same process improvement rigors as say setup reduction.
I've attached a small PowerPoint presentation that I've used in the past when reorganizing companies. If it helps, if it makes sense, then I would challenge you to take the next step; what is each process accountable for and more importantly, how do you measure their success.
Let me know how you make out.
Bill
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05/21/2012 10:56 AM
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Hi all, and thank you so much for your input on this.
Several of the tips I think will be quite useful. I do like 2x2 matrices, however one would still use far to much time on the "what adds value" discussions for this to be a starting point.
The Integrated Enterprise Excellence methodology was new to me. This actually seems like a pretty good starting point slicing away all those processes that we can fix later.
Bill: your ppt was very nice indeed, and surely something that I will bring along in my tool box. However, having +30 000 employers worldwide to deal with, the practicalities need to be sorted out more closely.
Lastly, I think the area of process categorization area is one that has been neglected. Or rather, real life big company practionaries have not joined the discussion. In theory, it's quite simple: core is the ones that add value. In real life, however, you my have a bunch of value chains, thousands of processes in all parts of the world, in which all you can find some real value add. Then politics come into play. In sum, you're in for lengthy ride.
As such, A "lean based process hierarchy" is a topic I hope will be debated more.
Thanks for your input!
Attila
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