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The
Issue
All
organizations, big and small, advanced and start-up, public
and private, service and manufacturing, are all operating
following a set of processes that they have defined. These
processes often are not documented and in many organizations
are not universally followed. The truth of the matter is that
even when they are documented, the rapid changing business
environment makes them obsolete within two or three years.
Most organizations define their operating procedures when
they are founded, but from that time on they are virtually
ignored. The only time that they are changed is when they
fail and then a quick patch is put in place to solve the immediate
problem. This causes them to be:
Highly bureaucratic Costly
Out of date Time consuming
Overly complicated Irritating
Not used
To
survive today, organizations have to do more with less, at
a higher quality level than ever before, and do it much faster.
This presents a challenge that can only be overcome by a drastic
improvement in the organization's critical business processes.
The conservative approach of continuous improvement that results
in a 5 to 10% improvement per year will no longer cut the
mustard when the competition is improving at a rate of 20%.
What is needed is a drastic breakthrough improvement in the
performance of the organization's critical business processes.
The
Solution
The
Business Process Improvement methodologies are the key to
solving this problem. They consist of five different methodologies.
They are:
Systematic Breakthrough |
Rapid Breakthrough |
| ° |
Process
Redesign |
° |
FAST
(Fast Action Solution Teams) |
| ° |
Process
Reengineering |
° |
HIT
(High Impact Teams) |
| ° |
Benchmarking |
|
|
Process
Redesign
is used when the present process needs drastic improvement,
but is not so bad that some of the concepts cannot be reused.
The methodology consists of twelve steps that are designed
to streamline the present process and upgrading it to best
practices. It is typically used when you want to reduce cost
and cycle time from 20 to 60%, improve quality between 40
to 100%. It is probably the right approach for 60 to 80% of
all the process improvement activity.
Process
Reengineering
is used when the present process is so obsolete that you don't
want to contaminate yourself with this baggage. This approach
challenges all of the paradigms that the present process if
built upon. It is about 300-500% more expensive than process
redesigning, but results in much better savings. It is used
when cost and cycle time reductions of 60-90% are needed and
quality improvements between 20-100%. It is a correct answer
for approximately 10% of the processes as it usually has a
cultural impact upon the organization.
Benchmarking
is often used in conjunction with process redesign and process
reengineering, although it can be effective by itself. It
is typically used when cost and cycle time reductions of 20
to 50% are desired and quality improvements of 10-150% are
needed. It is the correct answer for about 10% of the processes.
The major drawback in using benchmarking is that you are following
another organization's lead as you are adapting or adopting
their processes.
Fast
Action Solution Teams (FAST)
are used to identify process changes that can be implemented
in an extremely short period of time. Basically this is a
one or two-day study project that defines improvements that
the individuals performing the study can implement within
the next 90 days. It is usually applied to sub-processes where
rapid improvement of 15-20% is needed. This is a process that
allows an organization to have many FAST engaged active at
the same time.
High
Impact Teams (HIT)
are made up of 6-12 people that work fulltime for two weeks
to focus on an individual's area processes. These teams usually
focus heavily on workflow and layout. The HIT completes 70-80%
of their activities during the two-week period. Often the
target area is completely transformed over a weekend, resulting
in an immediate effectiveness improvement to the area.
For a better understanding of Business Process Improvement
methodologies, read Dr. Harringtons books entitled Business
Process Improvement and Business Process Improvement Workbook
published by Quality Press and McGraw Hill.
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