5 Steps to Significant Process Improvement, A Case Study

November 5, 2017

Over the last couple of months I’ve been working with a client on making significant improvements to their business operations. The 5 step approach we’ve been using can be instructive to others who want to improve their own business processes in a logical and methodical manner.

A little background on the company will help give context to the steps we followed and the results we achieved. This is a service company. They provide highly skilled labor, and specialized equipment to their customers. My client’s employees are on location at their customers’ sites on a daily basis for years at a time. They have staff spread out across the country at about 100 customer sites. Every customer site is different, with different needs and different contractual arrangements.

Step 1. Document the As-Is processes– Our first step was to create a process map of the existing business processes. We needed to document how the business worked and use that data guide our improvement efforts. This is usually called documenting the As-Is process. I interviewed the people who performed each step in the process and translated what they told me into a process map. The resulting picture included the entire business process from identification of a sales opportunity through the collection of payment. I had the experts validate that my process map was accurate then shared the results with all involved. This was the first time anyone had seen a coherent picture of the how the business operated end to end.

Step 2. Identify issues and opportunities – Having a complete picture of all the steps required to run the business gave us the ability to see where things didn’t work. We identified all the issues, the places where things went wrong, and we identified all the places where there were opportunities to make things better. It was a classic example of the value of a picture over a written description. Issues and opportunities jumped off the page. We compiled a list of over 60 detailed issues and opportunities. Some were very small issues like, ” Demo equipment is often left at a Client site for months at a time.” Some were critical and needed to be addressed immediately like, “Monthly billing for labor is too often wrong. It is sometimes understated or delayed.”

Step 3. Identify any root causes and/or major themes – We identified the root cause of every issue. This is a relatively easy thing to do using a simple 5 Why technique. Looking at the list of root causes, we came to see a small set of common themes, a set of what I called summary issues. A couple examples of these summary issues are: Critical Information is not gathered at the source at the time it is first known, and information needed for accurate and timely billing is not documented in any systematic way.

Step 4. Develop an improvement strategy – At this point we had a picture of the As-Is process and a list of both detailed and summary issues affecting operations. Looking at both of those, we develop an over arching strategy that would guide our individual improvement efforts. The strategy is ‘Capture critical customer related information at the moment it known and record it in a system that everyone who needs it can access.’ With the strategy agreed to, we looked at the list of issues and selected a set to start working on. Selecting which processes to start improving is always tricky. You could select a small or simple process to fix and improve that one to show that your are making progress. This approach gets people used to things changing, but you risk the “so what” reaction. The “so what” reaction happens when people look at the improvement you made and say “so what, that’s no big deal.” Your other option is to take on an improvement that will have a significant impact to the bottom line. The risk with this approach is these types of improvements take time and you do not see immediate results. In our case, we selected the most pressing issue to attack first and this put us in the significant impact arena. There was some risk with this because it would impact about 200 people and required implementing some new technology.

Step 5. Design and implement the To-Be process – With steps 1 through 4 complete, we were ready to redesign the process. We designed the new process by working backwards. We defined the goal of the process, “Accurate and timely customer billing”, then listed all the things that prevented us from reaching that goal. We redesigned the process to overcome each of those problems. The redesigned process was documented in a To-Be process map and we got all the stakeholders bought in. I then developed a project plan to implement the changes and we are currently working our way through the plan on track for a Jan 1st implementation.
We have found this 5 step process very effective and will continue to use it to make additional improvements to the company’s operations. Try these 5 steps on your own process improvement efforts and see how it works for you.
If you would like help improving your business operations, email the ACA Group at DH@TheACAgroup.com or call us at 626-390-6935. Learn more about the ACA Group at www.TheACAgroup.com

Doug Howardell is a consultant who specializes in helping clients improve their business practices and processes. During the past twenty-five years, he has designed new processes and tools, selected and implemented new business systems, and managed business process improvement projects. Contact Doug at DH@TheACAgroup.com

Tags: , , , ,

Categorised in: , , ,

   ©2020 The ACA Group.