Feeds:
Posts
Comments

Motivation: more evidence against the carrot-and-stick

November 2, 2009 by Daniel Lock

I stumbled across this video from the very good TED the other day, and given my recent post about achieving results through others decided to post it for you.

Dan Pink, shows some very good scientific research into the nature of intrinsic motivation and the circumstances when extrinsic motivation works, and when it doesn’t (which is most of the time).

Evidence of repeatable studies where people performed worse when incentives where provided for creative problem solving tasks. The carrot and stick approach, is a vestige of Taylorism and scientific management which turns out, isn’t very scientific.

I can recall one of my first managers (whom I am still very good friends with), deciding that no one in the call centre could have email access, not even internally. He felt that people would be distracted and unproductive. We eventually wore him down and gave access to email (internally only) and there was no productivity change whatsoever (positive or negative). But I am sure they felt a little more trusted to behave like adults, and spared the Team Leaders time in handling ‘paper messages.’

This big brother command- and-control mindset still exists, we talk about empowerment, which requires even the (lowly?) call centre operator to know hundreds of minute details about hundreds of products, listen to the inflection in a customers voice that says “I am about to lose it,” and make a split second decision about the whether to reverse a fee or not.

Yet during a meeting the other day with a certain telco they have implemented spying software on their staff so they know when they have been slacking on facebook when they should have been attending to the customer or something.

This is lazy leadership, because if you go with Dan Pink’s autonomy, mastery and purpose, you have as a manager have to be a better person. You must set the benchmark, for standards of behaviour, creativity and values.

Posted in Uncategorized | Tagged , , , | 1 Comment »

Empowerment

October 30, 2009 by Daniel Lock

TRUST

Empowerment is more than a buzz word, it is a real management tool that is pragmatic and must be implemented if you are to build a high performing organisation.

Why does empowerment have a bad name? Probably because of silly pop psychology techniques such left-brain/right-brain thinking. And there are many others.

A definition: that employees are able to make decisions that are important to the results of his or her work. Or put another way, that authority is in line with accountability.

Why is empowerment important?

For two reason, one, that it achieves better results (more on this later). The second reason is that it builds employee self-esteem, and intrinsic motivation.

Builds Trust

In Covey’s famous book  7 Habits, he talks of trust, and building trust bank account. We all know that trust is often circumspect between management and employees. A major reason for this is that employees don’t feel as if management trust them, and this is manifest in the misalignment between authority and accountability.

How can employees be expected to achieve the outcomes for which they have accountability if they don’t have the authority to make those decisions.

An Example:

Imagine an environment where an order for a client has gone missing, the shipping manager is responsible for getting the order to the client on time, but the only person who can call the client is the account manager, who at this time is out of reach.

A simple example where the shipping manager must now go to is boss for approval to do his job and make a simple call to the client to verify an order or sort out confusion.

Creates Better Outcomes

Toyota is a great example of an empowered organisation. Employees on the production line have the authority to stop he entire line if they see a defect. This reduces failure work, and a whole car being built which can’t be sold.

Or a completely different company, 3M, which empowers its people to take risks in designing new products, giving them the freedom to fail. I understand 3M to have a corporate metric to the effect that 25% of this years sales should be from products that didn’t exist 5 years ago.

How to Develop an Empowered Organisation:

  1. Boundaries: We all need boundaries from with in which we operate. Review the arbitrarily set boundaries and re-set them with rationally set boundaries. Challenge why these authority levels exist. For example why is it that an employee can only reverse fees of $20, when the average fee size for their customers is $100.
  2. Skills: Train your people, your people probably have the product knowledge, but a front line staff may need training in dealing with conflict and problem solving skills.
  3. Motivation: Employees maybe sceptical at first, they may infer you are asking them to take on more responsibility with out more pay for example. Assuming this isn’t the case, demonstrate how their lives will be made easier and the customer will be taken care of. Demonstrate how it is in their best interest to be able to make these decisions.
  4. Build the systems: Design the systems and culture that will allow people to flourish, if people make mistakes are they made to be wrong, or do address it as learning and review the decision process.

Empowerment is a real world tool for a more effective organisation. With a pragmatic approach, any manager no matter if they implement in a pocket will improve their results by empowering their people.

People wont give away the farm, this is the often cited defence against empowerment. This thinking sends a clear message that you don’t your employees. They will get it.

If customer interactions are part of the job, then it is the job of the manager to empower the person to do the job.

Posted in Leadership | Tagged , , , | 2 Comments »

Achieving results through others

October 28, 2009 by Daniel Lock

MOTIVATION

People motivate themselves, this article looks at how to set up structures and enable change to flourish.

The Carrot and Stick Approach

The carrot and stick approach is as old as the hills and the method of lazy managers. At best you will achieve temporary compliance. Over the long term loyalty will be absent and quality of work will suffer dramatically.

It is often perceived that people will work harder for rewards and be motivated to turn up on time with punishments.

But the truth is people are motivated for many reasons, and certainly much broader than money and punishments. While it is true that, people are motivated by rewards, it is the reward that they as individuals value.

It is well known that money is not a motivator. Herzbergs definitive study indicated showed that extra money did not drive motivation in line with the additional cash, but the absence of adequate pay was a dramatic de-motivator.

People are motivated by what they value. And this is different for everybody. This is why blanket motivation programs don’t work and often back fire.

One person may have ambitions of becoming a leader, and so will work hard to engender good will to this end. Whereas another will have no interest whatsoever in management and just wants a steady job, they can feel satisfied in. Neither view is better or worse, but a simple example of how people have differing values.

Fear As a Motivator

The big stick approach – fear – does not drive performance. It does however move people, but at a cost. A cost of ill will, lack of loyalty and dissent.

Bullying managers, may threaten people for not working overtime, being a team player, with financial pressure or threats of not being promoted. Either explicit, or worse implicit passive aggressive behaviour.

It only works when the big stick is present and visible. When it is not, it ceases to work. It is the use of force to get things done, as opposed to that of appealing to peoples values.

Why peer pressure doesnt work

We probably all remember peer pressure at school, well it never really changes. We are all very much influenced by the company we keep.

In organisations peer pressure, or normative pressure as the psychologists call it, is alive and well, and often a favoured tool to attempt to motivate staff.

It’s the old story, everyone else is doing it, so should you.  Again it moves people to action, but not lasting motivation. Sales pitches from the snake oil salesman include the line, ‘don’t be the last to miss out.’ But if you look a little closer we are being manipulated to their end.

People are smart, individualistic, and pragmatic. Appeal to common sense and their individual values and you will build intrinsic motivation as opposed to external force.

Self Interest

Influence works, if and only if, it is the finding of others self interest and showing them how both peoples objectives will be met and are aligned if they co-operate.

Reciprocity, is understanding what my needs are as an individual manager, understanding what the individual needs ad values are of each seperate individual in your team, take the time to match there values to your values.

Be aware that behaviours change considerably between people, and as behavioural dispsotitions (say detailed people versus big picture who might get bored with details). Also specific circumstanes mat also influence their values and bahviours at any one time, eg single, family, living circumstances etc.

Instead avoid one size fits all motivation approaches and instead, go for a tailored individualised method. Examples of these are competitions between sales people, instead focus on programs where everyone can win, say by a program that recongnises that improvements from last year to this year. (not an arbraitary number set for this year). Or try team results that create results far in excess of the sum of the parts.

Here’s how to find put what people value:

  • ✓ Talk to them about their private life, dont become friends necessarily, but get to know them more personally. Show an interest.
  • ✓ Observe their beahavour over time (dont take one example as a given, watch for a pattern), listent o how they speak, what examples they use and so on.
  • ✓ Analyse their successes and failures, why did the succeeded and fail in one setting and not another.

People don’t resist change, the resist the unknown

It is a common myth that people resist change. However people change all the time, voluntarily getting married, and buying houses, arguably some of the most important changes people undertake.

People will resist stupid changes they consider wont work. Many employees have been in their roles long enough to see a few managers come and go, changing from centralisation to decentralisation and back again. Causing ever more bureaucracy each time.

Often the end state, the vision is well articulated and makes sense.  People have ample reason to believe the goal is a good one. But the path and how we will get their is not clear, and filled with uncertainty and risk.

This is where management must focus attention. In carefully describing the journey in how to get to the end state. And also involving them in that process.

Here is a list of actions to think about when creating buy-in for change:

  • ✓ State problem as clearly as possible gain agreement that this is really the problem, and an accurate definition
  • ✓ Show the direction of solution, not the entire solution, for this you will need your teams input
  • ✓ Map out the the path to getting there.
  • ✓ Let your team point out risks and issues, and build solutions to these them into the plan
  • ✓ Give a gentle push, to get started.

Describe the path as accurately as possible, and allow them to poke holes in the plan and work together to resolve the issues. This creates buy-in.

From here be careful as although there is logical understanding and buy-in people often hesitate to ‘let go.’ Like the first time sky diver, he knows it is safe as can be and with experienced and careful people, but they need a push out the door. Likewise, don’t be afraid after proper pre-work has been done, force people to let go, take away the old system, tell them that as of next week, the old way of doing things will b stopped.

In life, in order to move to the next level we must let go of the old. Often, while we know this we have a visceral gut feeling that prevents us from making the step.

Choose informal leaders, who will set the (positive) example. Find key influencers, and let them know you are counting on them to usher in the change. Ask them to help you help the team.

Leaders are smattered throughout organisations and it isn’t because of a title or position. Leaders can be seen by their behaviours. These leaders, often inspire great deal of loyalty from others. Find these people and get them on board early. They don’t need to necessarily take on responsibility,  but ensure they fully understand and support the change and then perhaps provide them visibility.

Light the winding road.

As stated earlier change is uncertain and filled with perceived risks. So keep people fully informed and in the loop every step of the way.

Communication is like glue. You need it t hold the structure together, but too much gums up the works. But don’t misunderstand this analogy. Too much doesn’t mean less frequent. It means keep it pithy. Short, sharp, to the point, and timely.

But above all, keep it honest. Make sure people are kept abreast of the successes, but more importantly be extremely candid about risks, issues, and mistakes.

Be clear about what you don’t know, and resolve it as quickly as possible. Don’t promise things that cant be delivered – explain why.

And of course don’t be overly bullish. If the change is wrong, and will sacrifice the long term objectives, for the sake of the short-term arbitrary goals, stand up and be counted.

Posted in Leadership, Team Building | Tagged , , | 1 Comment »

Uncertainty, randomness, and risk.

October 23, 2009 by Daniel Lock

RISK - DICE

Uncertainty, randomness, and risk. These are the notions of business and life I have been researching of late. The GFC, and its personal impact, has caused me to look deeper into my own decision making processes, risk appetite and my own definitions of what I want out of life.

Having started a business during a boom time, with what I thought were 3 back up plans, all of which went south, at the same time. I can recall talking to a friend saying, well what’s the likely hood of that happening. Well it tuns out that these events do happen, when things go wrong, they usually go very wrong.

It’s very easy to get into business arrangements, but very difficult to get out of them.

So being an avid reader, I went in search of a greater understanding of what led me to these decisions and how I can learn from these times and improve decision making in the future.

I read Fooled by Randomness and the Black Swan by Nichlas Nassim Taleb, this really gave me some important insights into risk and uncertainty. Being involved in improving businesses, project management and private investment, my world is filled with making decisions under uncertainty. Taleb’s books really woke me up to the idea that there is much we don’t know about business, and what we don’t know adds up to randomness and uncertainty.

Hindsight

Too often I have looked to optimise by investments and cash flow’s, being an optimist by nature. This has resulted in excessive risk, that in hindsight I should have recognised.

Ah, that wonderful word ‘hindsight.’ Well, given my knowledge base and disposition at the time, what other decisions could I have made. I think we learn by making mistakes and essentially this is the life of the entrepreneur. Heuristicly, learning by doing. The phrase ‘trial-and-error’ much to my distaste involves error.

We make up stories about the past and attribute qualities to people who have experienced success that really didn’t exist. Or at least the people who failed and ran into problems also exhibited. To explain and rationalise why things happened we make up stories, often looking to blame, rather than looking for cause. But even then the cause may not be clear. That is to say it is a random event, that no one could have known – except perhaps for Murphy.

As business leaders, whether in corporate management making strategic decisions, or the operational manager we are faced with Murphy. That things can go wrong, and because they can, they probably will.

The notion of efficiency and optimising is pervasive in our business world. The notion that a critical machine in a production line might go down causing customer orders to go down means we must have back up plans, or build in buffers to protect production.

Maintain Buffers

I have been studying the Theory of Constraints (TOC), lately and what has struck me is the pragmatic way in which they address uncertainty with buffers. Known as ‘buffer management’ in the vernacular. Maintaining buffers is not in any way efficient, it means resources standing idle, it means capital not being used in inventory.

But when applied at the critical point, it makes perfect sense.

For example, if we have a deadline to finish a task in 4 weeks, it makes sense to finish it a week before in case issues pop up in our life, or the task is more difficult than we expect and so on. All of these things are entirely possible, nay actually probable.

So in our investment decisions it make sense to carry cash, more than we probably need for an optimal investments strategy.

On Debt

It also means that we should carry little if any debt. I have never carried consumer debt. That one always made sense to me. But using debt for investment and increasing returns was something I was into. Optimisation.

But look where this has got us. Banks with way to much gearing, investors the same, consumers just the same.

Consider as I stated before that is things can wrong they probably will, and that having debt funded investments is risky, then it makes sense that one day the deal will come unstuck.

Consider Warren Buffett, one of the richest people in the world, who has made this achievement, as I understand it with little to no debt. And it makes sense. What is another $100m, or $10m, or even $100k in return from a deal with debt funding when it exposes one to such dramatic losses.

Maintain Options

Strategically we don’t really know which ventures will take off and which wont. Sure we put plenty of due diligence into ventures, but there are a host of unknown. This is the paradox, we much invest to grow, but we have no idea where the investment should be. So it makes sense to take many smaller positions in related (but different enough) opportunities to allow for the one of them to flourish.

Chances are that one will, while the remaining will probably peter out. Lost investment? Whose to say, you had to be in it win it. To find the positive black swan.

Go Out and make connections

This is the essence of marketing and sales. Get out there, turn over the rocks, make connections, do the speeches, blog, go to parties.

You never know where the opportunities will come from.

So here is the summary of my learnings to manage uncertainty:

  • Maintain buffers: Protect yourself, tasks, investments with buffers.
  • Eliminate debt: even for investments, constantly work to eliminate debt. Save to invest:
  • Focus and have meaningful discussions about risk:  ask what could go wrong, what is the probability and what is the impact of the outcome. Don’t go through the motions, really pay attention
  • Expose yourself and business to positive black swan events, which have very little cost, and massive upside. Go to parties, lots of marketing activities. As much as possible.
  • And as Taleb says: Go to parties

Posted in Management | Tagged , , , , , , | Leave a Comment »

Newsletter October 2009 – Strategic Innovation Newsletter

October 22, 2009 by Daniel Lock

Strategic Innovation Newsletter

Welcome to the October 2009 edition of Strategic Innovation newsletter, a free monthly newsletter on leadership, strategy and innovation. Delivered on the first Tuesday of each month.

Back issues are archived for free downloading at www.DanielLockConsulting.com.

Tips for improving business processes

  • Bureaucracy often creates excessive paperwork in the office
  • Managers typically spend 40 to 50 percent of their time writing and reading job-related material; 60 percent of al clerical work is spent on checking, filing, and retrieving information, while only 40 percent is spent on important process-related tasks.
  • Evaluate and minimize all delays, red tape, documentation, reviews and approvals
  • Management reduces bureaucracy by starting with a directive. The directive informs management and employees that each approval signature and review active will be financially justified, that reducing total cycle time is a key business objective, and any non-value added activities will be targeted for elimination.
  • A bureaucracy step should be left in only if there is a sizeable, documented savings from the activity.

The 10 cornerstone tools to streamlining

The world of business innovation and strategic planning is ever-changing and always evolving into something new and exciting. Does your business have the strategic agility to survive the world-wide recession of 2009 and onward?

“It’s an ever-changing world,” you’ve heard the statement, but has it really sunk in yet? The world of business innovation and strategic planning is ever-changing and always evolving into something new and exciting.

Does your business have the strategic agility to survive the world-wide recession of 2008 and onward? Intelligent business owners understand the importance of modifying business strategies to embrace innovative ideas and survive.

For example, businesses that once operated from U.S. based call centers found that outsourced work to overseas call centers saved a lot of money and was a sound business decision 7 to 10 years ago.

Customer service became difficult simply because of the language barrier. Unhappy customers would move to another business that hired native English speaking employees.

More recently, the same U.S. based business may have come to realize that the work outsourced overseas is better and more easily managed by employees working from their home office. Even though the businesses may pay higher wages to home-based workers than they would to overseas employees, overhead was cut dramatically.

Taking the opportunity to hire and train employees who could effectively handle customer service from their home office relieved the stress of expensive building upkeep and other bills involved with operating from a large brick-and-mortar business location.

Customer service and retention are up because more workers are native English speakers and the communication gap isn’t a hindrance to customers when they call for assistance.

Strategic skills and competent business planning worked hand in hand to save the corporate world once again.

That was just one tiny example of how successful strategic planning can see your business through even the toughest economic troubles. Businesses around the world search for the perfect employees to fit their needs.

Smart CEOs and general managers embrace the idea of hiring people who are innovative thinkers and will help implement the ideas they propose. Tactical and strategic thinkers help businesses succeed and grow, no matter the economic outlook world-wide.

What is Strategic Agility and Why is it Important?
Strategic agility is the ability to transform knowledge competency into innovative ideas; the ability to successfully reinvent businesses over and over again.

Business, like everything else in life, is ever-evolving. In order to succeed at any type of business, you must have the flexibility, strategic skills and competent business planning to change as needed.

No single marketing plan will work forever.

Take a look at some of the most well-known businesses over the last 100 years. Would the soda companies be successful today if they hadn’t changed their look and tastes over the years?

Imagine for a moment if Coke didn’t take their businesses world-wide. Their success wouldn’t be nearly as obvious as it is today.

How Change Drives Growth and Success
Business is a game you learn as you go. Not one single CEO can say they haven’t learned a lot on the road to success. Business colleges do a great job preparing you for things that may happen, but the ability to really strategize and plan ahead aren’t something you can learn in school.

Common sense, innovative ideas and great business competency create strategic agility; the ability to grow and change your business into something that will last. Change is imminent, embrace it and let it guide your business strategies.

Look to the future by learning from the past. History repeats itself and as long as we are able to recognize and learn from the mistakes of failed businesses of the past, we will continue to grow and succeed.

Don’t let short-term success blind you to the long-term effects of any business decision you make. Always be willing to change and grow!

Strategic Agility, Flexibility & Speed
These four ideals, above all else, can help ensure a successful business. Strategic agility is much more than the ability to adapt to change. You must also know how to respond to change with strategic vision and competent knowledge. You must understand when it is time to dump old business strategies and recreate new ones.

Move on from existing competencies and create your own business rules. Focus on hiring people with who are good at creating new and different winning business strategies.

Flexibility and speed often go hand-in-hand to create the ideal workplace. Most businesses only welcome new business ideas from upper management.

Why? Because those are the people who have earned their way to the top; they’ve been to top notch colleges and are well-educated. Unfortunately, sometimes education isn’t enough. Some of your best business ideas may come from employees from anywhere in the company.

Start by asking your management teams, as well as the executive team, to help by creating new and different ideas or present potential business plans.

By allowing innovation to come forward you open yourself and your business to a whole new world of legitimate new trends and potentially wildly successful business ideas.

Technique of the month: Involve your people

Innovation is all about doing something new and different, and doesn’t necessarily mean spending more money. More often it just means slaughtering some sacred cows.

Below are three quetions to ponder, from the Theory of Constraints (TOC):

  • What to change?
  • What to change to?
  • How to cause the change?

Posted in Newsletters, Uncategorized | Tagged | Leave a Comment »

September 2009 – Strategic Innovation Newsletter

September 11, 2009 by Daniel Lock

Strategic Innovation Newsletter

Welcome to the September 2009 edition of Strategic Innovation newsletter, a free monthly newsletter on leadership, strategy and innovation. Delivered on the first Tuesday of each month.

Back issues are archived for free downloading at www.DanielLockConsulting.com.

Follow Me, Follow You

I’m getting more into the online marketing space.

You can a find a page at Facebook and also LinkedIn.

Look forward to an online hand shake!

Tips for improving business processes

  • Improvement of a process means changing a process to make it more effective, efficient, and adaptable.
  • Preventing means you change the process to ensure that errors never reach the customer.
  • Excelling means that the process works, it is stable, and meets customer requirements.
  • Bureaucracy is bad, boring, burdensome, and brutal.

 

 

The 10 cornerstone tools to streamlining

 

Innovation is carried out by many Australian businesses both big and small. The ABS in its summary of IT Use and Innovation in Australian Businesses for 2005-2006, reported that 38.9% of Australian businesses are implementing innovation.

According to the report, approximately 21% of businesses are introducing new operational processes. About the same proportion (19%) are introducing new goods and services, while new marketing methods are being introduced by 14% of businesses. However, most of these are large businesses: 74% of those that implemented innovation employed over 200 people, while only 49% of those with 5 – 19 employees did so.

In terms of broad industry categories, those implementing an innovation during the period were manufacturing (45%), services (38%) and mining (36%)

Facts and Statistics

Results of the ABS 2005-2006 Business Characteristics Survey (BCS) revealed some significant statistics. In this survey, the Health and Community Services and Personal and Other Services were included as additional sectors. It also expanded the survey population by including those with 0-4 employees.

This change in the survey population and the level of stratification made the current results different from those of previous years so data contained in the two years should not be compared.

Innovation can be classified into four. These are product innovation (goods and services), process innovation, marketing innovation and organizational innovation.

“An innovation is the implementation of a new or significantly improved product (goods or services), or process, a new marketing method, or a new organizational method in business practices, workplace organization or external relations.” To be considered an innovation, the process or method must be new or a significant improvement of that already in place.

The Four Types of Innovation

  1. Product innovation refers to new or significantly improved goods and services as to their characteristics or intended uses. Examples are significant improvements in components, materials, technical specifications, ease of use, the software involved or any other functional characteristic.
  2. Process innovation refers to changes in production or delivery methods, including equipment and/or software and innovative techniques.
  3. Organisational innovation refers to new organisational methods that are implemented in workplace organisation, business practices and external relations.
  4. Marketing innovation involves new marketing techniques that involve changes in product packaging or design, product placement, product pricing or promotion.

In summary, then, a significant number of large Australian businesses are innovative in nature, while smaller companies tend to be less so. Innovation is a must for any business that wishes to retain their market share, or even improve it, in difficult financial times such as these.

Innovation can save money and increase productivity, and there are few doubts that new product designs are attractive to the consumer.

 

 

Technique of the month: Involve your people

 

Innovation is all about doing something new and different, and doesn’t necessarily mean spending more money. More often it just means slaughtering some sacred cows.

Below are three quetions to ponder, from the Theory of Constraints (TOC):

  • What to change?
  • What to change to?
  • How to cause the change? 

Posted in Newsletters | Tagged | Leave a Comment »

August 2009 – Strategic Innovation Newsletter: Tips for improving business processes

August 13, 2009 by Daniel Lock

Strategic

Welcome to the August 2009 edition of Strategic Innovationnewsletter, a free monthly newsletter on leadership, strategy and innovation. Delivered on the first Tuesday of each month.

Back issues are archived for free downloading at www.DanielLockConsulting.com.

Follow Me, Follow You

I’m getting more into the online marketing space.

You can a find a page at Facebook and also LinkedIn.

Look forward to an online hand shake!

Tips for improving business processes

 

  • Streamlining suggests the trimming of waste and excess, attention to every little detail that might lead to improved performance and quality.
  • Streamlining provides a smooth flow.
  • With streamlining, the process will operate with the least disturbance to its surroundings.
  • Improvement of a process means changing a process to make it more effective, efficient, and adaptable.
  • Preventing means you change the process to ensure that errors never reach the customer.

 

The 10 cornerstone tools to streamlining

 1. Eliminate bureaucracy

Bureaucracy occurs as organizations grow, because as each manager gets busier they hire someone new, which is fine, except they don’t hand off the decision making authority. After a few years of this ‘up and down the chain’ movement, you have bureaucracy.

2. Eliminate duplication

One of the most common places where duplication can be identified is in reporting or information. Always strive for having one point of truth, which can be accessed on demand, rather than having someone prepare this information.

3. Determine what adds value to the process

Evaluate every activity in the business process to determine its contribution to 
meeting customer requirements.

4. Simplify

As humans we have an innate tendency to over complicate things. The quickest way to simplify, is to ask the key question: “What are we trying to do?” In other words, if in doubt start with objectives. Confusion and complexity usually come about through a discussion of alternatives before the objectives have been understood.

5. Think Rapid Response

Determine ways to compress cycle time to meet or exceed customer expectations and minimize storage costs. All ‘waiting’ time is wasted time. Waiting doesn’t add value to the customer; it makes them think you have forgotten them. 

6. Use software and systems properly

Make effective use of capital equipment and the working environment to improve overall performance. There is a saying in the property development game about using land for the ‘highest and best use’, apply this to systems, equipment and software too.

The corollary of this is to not become technology centric. Rather technology must enable us to improve the process not introduce more problems.

7. Make it difficult to do the activity incorrectly

Then you don’t need quality checking, because it’s already done. Think of those ‘mandatory for completion’ fields in applications.

8. Reduce the complexity of the way we write and talk

Enough said.

9. Standardise – select a single way to do the activity

This means involving the key players in defining the ‘operational definitions’ and agreeing that there is in fact a best practice and consistent approach on how to do a particular task.

10. Involve your suppliers in your business

Create a structure and policy that encourages supplier feedback and partnership ‘big picture’ improvement – look for creative ways to drastically change the process to automate and mechanise. 
  

Technique of the month: Involve your people

Process is all about people. People running the process know more about your business processes than the CEO ever will. But remember to follow these three key rights of the worker, and they will be loyal to the end;

  • I know what to do
  • I know how to do it
  • I know how I am going against targets set for me

Posted in Newsletters | Tagged , , | Leave a Comment »

The Value of Understanding Process

July 30, 2009 by Daniel Lock

Recognizing the Performance System.

“The fact is that the system that people work in and the interaction with people may account for 90 or 95 percent of performance.” W. Edwards Deming.

Posted in Process Improvement | Tagged , , , | Leave a Comment »

3 Key Rights of the worker

July 27, 2009 by Daniel Lock

For those involved in management. Keep these 3 rules in mind:

 

  1. I know what to do
  2. I know how to do it
  3. I know how I am going against targets set for me

Posted in Management | Tagged , , | Leave a Comment »

Business Process Improvement

July 27, 2009 by Daniel Lock

I found this great review of this book: Business Process Improvement: The Breakthrough Strategy for Total Quality, Productivity, and Competitiveness (Hardcover) on Amazon.

  1. Streamlining suggests the trimming of waste and excess, attention to every minute detail that might lead to improved performance and quality. 
  2. Streamlining provides a smooth flow. 
  3. With streamlining, the process will operate with the least disturbance to its surroundings. 
  4. The 12 cornerstones tools to streamlining: 
    1. Eliminate bureaucracy
    2. Eliminate duplication 
    3. Evaluate every activity in the business process to determine its contribution to meeting customer requirements. 
    4. Simplify 
    5. Determine ways to compress cycle time to meet or exceed customer expectations and minimize storage costs. 
    6. Make effective use of capital equipment and the working environment to improve overall performance. 
    7. Make if difficult to do the activity incorrectly 
    8. Reduce the complexity of the way we write and talk 
    9. Standardize – select a single way to do the activity 
    10. Create a structure and policy that encourages supplier feedback and partnership 
    11. Big picture improvement – look for creative ways to drastically change the process 
    12. Automate and mechanize. 
  5. Improvement of a process means changing a process to make it more effective, efficient, and adaptable. 
  6. Preventing means you change the process to ensure that errors never reach the customer. 
  7. Excelling means that the process works, it is stable, and meets customer requirements. 
  8. Bureaucracy is bad, boring, burdensome, and brutal. 
  9. Bureaucracy often creates excessive paperwork in the office 
  10. Managers typically spend 40 to 50 percent of their time writing and reading job-related material; 60 percent of al clerical work is spent on checking, filing, and retrieving information, while only 40 percent is spent on important process-related tasks. 
  11. Evaluate and minimize all delays, red tape, documentation, reviews and approvals 
  12. Management reduces bureaucracy by starting with a directive. The directive informs management and employees that each approval signature and review active will be financially justified, that reducing total cycle time is a key business objective, and any non-value added activities will be targeted for elimination. 
  13. A bureaucracy step should be left in only if there is a sizeable, documented savings from the activity. 
  14. Duplication of data from different parts of the organization can produce conflicting data and lead to the unbalancing of the organization. For example sales may generate a monthly customer production ship forecast and production control distributes a completely different forecast. 
  15. Accrual means the value of the end product exceeds the accumulated costs. Value added=value after processing – value before processing. 
  16. Value added assessment is an analysis of every activity in the business process to determine its contribution to meet end-customer expectations. 
  17. Value is defined from the point of view of the end customer or the business process. 
  18. Waste occurs when activities exist because the process is inadequately designed or the process is not functioning as designed; activities not required by the customer or the process and activity that could be eliminated without affecting the output to the customer. 
  19. Instability occurs as organization grow, processes break down and are patch for use, and become excessive complex. 
  20. Errors occur when additional controls are put in place to review outputs rather than change the process. 
  21. Communication breakdown exasperates failure when individuals in the process fail to talk to their customers and understand their requirements. 
  22. Too much time is spent on internal maintenance activities such as coordinating, expatiating, record-keeping instead of on redesigning the process. 
  23. Quality is possible and rework eliminated when the causes of the errors are removed. 
  24. Combining operations, moving people closer together, or automation can minimize the moving of documents and information. 
  25. Waiting time can be minimized by combining operations, balancing work loads, or automation. 
  26. Identifying root causes reduces trouble-shooting. 
  27. The increase in complexity results in increasing difficulties everywhere as activities, decisions, relationships, and essential information become more difficult to understand and more difficult to manage. 
  28. Simplification starts by evaluating every element making it easier to understand and less demanding of other elements. 
  29. When an organization fails to make continuous simplification efforts a major portion of the managing process, it invites difficulty and poor performance; simplification is achieved by combining similar activities, reducing the amount of handling (reduce delays caused by handoffs and decision making), eliminating unused data and copies, and refining standard reporting.

Posted in Process Improvement | Tagged , , , | Leave a Comment »

Older Posts »