The Top Six Reasons for Process Improvement Initiatives
The following article was originally published on the iDatix Insiders Blog.
“From little things, good things grow” they say – but when execs sign off on expensive process improvement initiatives (let’s face it few of them are cheap!) what are the top reasons for them giving the go ahead?
6. Me Too
“Hey everyone else is doing it, so why not us!”
No-one’s going to admit it but the persuasive voices of business publications and software vendors have made process a popular initiative. The fact that a trickle of improvement projects has turned into a Tsunami of BPM and transformation initiatives has placed a level of peer pressure on execs who are being asked by their CEO’s why they aren’t keeping up with the joneses. Take the example of two global insurance companies who invested heavily in top secret process improvement projects only to find out that they were both doing exactly the same thing…
The forgotten man of process improvement. By adopting systematic methods a few sharp tools in the shed have realized that process can lead to “out of the box” thinking. These can be fantastic for “white space” initiatives which are designed to take the business outside of its operational core in order to break into new products and services.
4. Customer Centricity
You’ll never find anyone disagreeing with the need for customer centricity, but you will find many businesses that either can’t get to it or pay lip service to it. Those that do make the investment find that customer centricity isn’t as easy as it sounds. Organisations are complex beasts and to tame them you need an enterprise wide approach to process that ties together strategy, business services, processes and technology.
Rather than being just a complex beast, transformation is a scary beast. This is because transformation encompasses more than just improving processes – it represents a fundamental change in the business from top to bottom. Transformations can make or break organisations and as a result they require huge effort in terms of process improvement, change management, organisational design, marketing and technology. There is typically a critical business reason for transformation projects, but that doesn’t seem to deter many organisations from taking the plunge.
Nothing spells “fix the process” like a major issue. One can only imagine the frenzy of process improvement that went on at BP after the deepwater horizon incident. When companies face imminent business death or financial punishment by regulators you can be sure that a shiney new project will spring up to face the music.
Time is money. We’ve been improving process efficiencies for hundreds of years and it’s not going to stop anytime soon. Show an exec a saving in process costs and a tidy business case that quantifies the payback period and they’ll typically bite your arm off to implement it. Businesses love saving money as saving money equals more profit, and more profit equals happy CEO’s and shareholders. It’s hard to increase revenues and even harder to increase profits – but it’s often not so hard to save money when process initiatives can clearly highlight how to do it.
These are just a few examples of reasons for starting a process improvement initiative – the true challenge is in achieving the business benefits that the initiative set out to achieve in the first place. But that’s another story altogether…