Capability Insights Consulting



Process improvement benefits - where to look

Posted on August 17, 2010 at 3:14 PM Comments comments (0)

Identifying, analyzing and making changes to business processes takes time and effort, and incurs expense. Changing how things are done impacts roles and responsibilities and can trigger employee resistance. Before embarking on process reviews and changes, it is wise to consider the types of benefits you might gain.


Each organization is different and the actual benefit numbers will vary, but below are some common benefit areas to be aware of and better yet to plan for.


Revenue generating benefits. These are opportunities to change current processes and practices to directly or indirectly increase revenue. These benefits are often the hardest to achieve as the changes needed usually break current mindsets and can fundamentally change roles and responsibilities. They often also have the highest payback. Here are some examples:


  • Upsell opportunities. A telecom company wants to have its call center staff sell more products to existing customers whenever they deal with a customer. The process review, analysis and design work will focus on building in the analytic processes (and technology) necessary to ensure call center staff know exactly what products the client has and what products might be of interest, as well as adjusting the training processes and performance management processes necessary to skill and incent the call center staff.
  • Improved products and new product opportunities. In this example a retail organization believes its own customers hold the key to identifying improvements needed in the current products and in identifying new product opportunities. Given its target markets, the organization knows it needs to include social networks in its product development strategy. The process review, analysis and design work will focus on how best to expand its current engagement processes to leverage social media. The organization has proven in the past that customer-focused product changes and development leads to getting higher revenue per product and getting it faster.
  • Client experience and business reputation. In this example, a financial services organization wants to ensure its target market of high-wealth clients receives exemplary service. In their target market there is a strong correlation between the experience of the customer and their willingness to do and grow their business with the organization. In this case the process review, analysis and design work are focused on identifying the business processes from the customers’ perspectives, ensuring that all customer touch points are identified and that the internal functional processes are seamless from the customers’ perspective. The organization needs a reputation of service excellence, effectiveness and efficiency to attract and keep its target market.

These are just 3 examples. What examples can you imagine for revenue generating process improvements in your lead generation processes, your product placement processes or your sales processes?


Cost saving or cost avoidance benefits. These are process and practice changes that allow you to remove costs from the organization or to delay or avoid new expenses. This is where process improvement efforts are often focused. Every organization should be looking at running as efficiently as possible. Remember though that no organization has ever cost-cut their way to roaring success!


Here’s some benefit areas to look for:


  • Improve the efficiency of work in the office. Any changes and improvements to your business processes that make it simpler and faster for your team to get their work done or to coordinate on tasks results in time saved. That time saved my result in the need for less people or more often it frees up time for existing people to focus on higher-value and revenue generating work. Looking for efficiency involves looking for unnecessary hand-offs, storing of information never used again, unnecessary approval processes, processing rules that made sense once but are no longer of value and of course ways to use technology to reduce manual handling.
  • Get rid of invisible reporting processes. Over time, requests from management for information or reports can lead to tremendously time consuming efforts of questionable value. What reporting and information gathering is done in your organization? Are the reports used anymore? Is the method to create useful reports as efficient as it should be?
  • Onboard and train people faster. Documentation that makes processes easy to find and easy to use reduces the training time for new people and the people that have to train them. Getting new hires up and running faster means they are also working on client revenue activities that much sooner.
  • Reduce key-person syndrome. Improve the ability for the office to function effectively if one or more of the team is away. Small businesses are particularly hard hit when a team member needs to be away. Good process documentation makes it far easier for someone else to step in and handle their work.

Risk reduction or risk reaction benefits. There is little doubt that this is a growing area of process work. Benefit areas include:


  • Security of data, premises and people
  • Ensuring privacy of customer/client data
  • Meeting regulations

The ultimate benefit to risk reduction or being able to react to a realized risk, is maintaining the organization’s reputation. Fines can hurt but rarely kill an organization. But if customers, clients or funders lose faith in your ability to provide the product or service they expect, you may never recover.


Process review and redesign to build in the needed controls, checkpoints and governance are often required. The trick is to balance the cost of the process work, and the ongoing execution of the changed processes, with a realistic assessment of various risk scenarios actually happening. It is far too easy to paint emotion-laden pictures of horrific happenings that sway leaders to build in process controls that are just too heavy and ultimately hurt the organization’s ability to run efficiently. Worse, processes heavy with rules and controls are the ones people most often don’t follow, defeating the purpose of the process work in the first place. In some cases it is better to have a process to react to a risk when it happens than to have a heavy process that tries to eliminate or reduce the risk.


Measurement benefits. Process reviews and improvements provide an opportunity to define and build in key metrics for processes. It really is true that you can’t manage what you can’t measure. More importantly you can’t improve if you don’t know how things are currently working. Having the ability to measure current reality sets the stage for continuous improvement. As with process work to reduce risk, it is necessary to carefully assess what needs to be measured and ensure it can be done efficiently without adding unnecessary weight to the process. Beware the seemingly endless human desire to create and consume statistics whether they add real value or not!



Process review, analysis and redesign work can and must result in benefits that surpass the cost of the work to change the processes. Make sure you are looking in all the right places for benefit opportunities.




The Lost Art of Why

Posted on July 3, 2010 at 5:00 PM Comments comments (3)

Has anyone else noticed that asking “why” has become a problem in our corporate/organizational world?


The parents amongst us remember well the phase our children went through when they asked why constantly. Sure, it could be a bit annoying at times but it also marked that very special time when we knew they were trying to understand how their world worked, what the rules were and where their boundaries were. In short they were learning. Many of their “why” questions forced us to rethink what we take for granted. I know some of those “why” questions left me wondering “why” as well.


As business has moved faster and as the economy has tightened, far too often those that ask the “why” of something are seen as nay-sayers or as people getting in the way of getting things done. I see it as a symptom of the lack of thinking happening in too many organizations. Taking the time to think things through is seen as “so yesterday”. The mantra seems to be “do, do and redo”.


I get it – agility is good, doing something is often better than doing nothing. Though I take issue with the idea that thinking about something, asking “why”, and digging for root causes is doing nothing!


Doing can be a way of thinking if we keep “why” in our vocabulary and treat our early doings as learnings and evolution. But even then there needs to be the freedom to ask why:

  • Why did we do it that way before?
  • Why isn’t it working now?
  • Why do we think this way will be better?
  • Why did our first iteration not get us where we need to be?

I now have to coach people to not ask “why” directly but rather to rephrase to “can you help me understand”, “what about this is concerning”, etc. When did we become such a defensive culture? We think of the business world as logical and rational, as strong and assured – yet nowhere is the simple question of “why” so frowned upon. No where else does it create the same level of defensiveness. Why?


For sure, those asking why must be respectful of the ideas and needs of others. “Why” should never, ever be an excuse for a personal attack. Asking why should always be about gaining understanding, about wanting to make things better, about wanting to surface any issues that could get in the way of implementation success.


I challenge all of us to get better at asking why and at accepting “why” questions. Why questions are not about tearing down proposals or plans, they are about gaining understanding and clarity; about exploring the edges of ideas or the core of how things have always been.


I challenge all of us to use “why” questions to uncover inefficiencies, easily avoidable risks, learn how others see a situation and to generally improve the success of our projects and businesses.


Hey, why not?!




Technology's Role Part 3

Posted on May 25, 2010 at 12:32 PM Comments comments (0)

The previous two posts (Technology’s Role Part 1, Technology’s Role Part 2) have been exploring the role of technology in building process and people capability. This final post of this series looks at the role of technology in building leadership capability.


As with process and people capability, technology plays an enabling role. But that role is not as obvious and is fraught with more risk and is frankly harder to do well. Let me state upfront that technology enablers cannot make a bad leader good or a great leader significantly greater. Yet there is still some magic available when done well.


Improved measurement and decision making


Leaders must make decisions like the ones below:


  • product pricing decisions, product development decisions, product retirement decisions
  • sales target decisions
  • project investment and prioritization decisions
  • decisions on competitive strategies, business models, annual budgets
  • organizational design decisions
  • performance management decisions

A leader’s day is made up of a series of decisions whether they lead a fairly small business unit or an entire global organization.


I’d be the very last person to take a certain amount of intuition out of decision making, but decisions that are based on having good metrics and data, properly analyzed and balanced with qualitative factors are better and more consistent decisions. They are defendable and explainable which is a tremendous help when asking people to make changes.


Decision support systems through to complex business intelligence systems (BI systems) can help leaders make better and more consistent decisions. They can enable a leader to have exactly the relevant metrics and facts in front of them when needed. They can combine facts and trends and offer analysis far faster than us mere humans. They can weed out the data that is not relevant or not terribly important for certain decisions helping us be more focused in our decision making.


The risks are not in the systems or technology itself. In order to be effective as an enabler the technology needs:

  • the organization to have defined the kinds of decisions the leaders need to make
  • the organization to define the metrics and data it needs to capture to aid those decisions and to ensure that the business functions/processes actually capture this data for later use
  • the organization to define the kind of data analysis and trending to be done
  • the organization to equip the leaders with the skills needed to use the metrics, data and data analysis
  • and potentially more around building capability to ensure data integrity and to continually evolve data analysis as the organization evolves

Technology applied incorrectly here can actually make decision making worse, can have leaders buried in too much data and basing their decisions on the wrong information. Even when applied well it can result in leaders relying too heavily on the data and not balancing data with real-world observations of what is happening in their organization and with their customers.


In short the organization must embark on some thinking about decisions and decision-making processes in their organization before running down the technology implementation path. In this do and activity based culture we live in, thinking time is often considered a luxury!


Summary: Technology and Capability

Technology can and should be used to help build people, process and leadership capability. What matters is how it is applied. Technology is not, nor will it ever be, a silver bullet. Understanding what your organization needs; its goals, its employee skills, its strategies, its products, the decisions that need to be made etc is hard work! That hard work matched with effective use of technology will be rewarding. Anything less than stepping up to that hard work is like taking a cut flower, shoving it in dirt and hoping it takes root. On rare occasions it works, the vast majority of time it looks good for a short time then wilts and dies. Except that technology is typically a lot more expensive than a cut flower!




Technology's Role in Building Capability (Part 1)

Posted on May 18, 2010 at 10:19 AM Comments comments (0)

Having worked inside IT and consulted with many IT and business leaders, I have to state upfront that I am a fan of technology. Some would say I’m borderline geeky! I believe that every organization and most business functions need technology to reach their potential.

  • Manufacturing processes rely on technology; Business processes/functions are often more efficient and effective when people are paired with enabling applications
  • Business Intelligence and analytics applications help leaders make better informed decisions
  • Social media applications help organizations reach out to a broader community for sharing information and recruiting
  • Entrepreneurs can have a business idea, create a corporation online, get a web site set up and be in business inside a week

Technology can create whole new industries and change the fabric of business.


But mostly, it doesn’t. Doesn’t improve things as much as expected, doesn’t change the way organizations run and doesn’t live up to the hype.


Technology’s role in building process capability

A poorly designed business process automated by technology is just a poorly designed business process that may execute faster. Automating existing processes without a good look at how they can be designed to use fewer resources, produce better products, improve customer service or retention, increase fundraising success etc is just leaving money on the table. You must have a clear picture of the goal of the process and how that goal helps the organization.


Technology’s (hardware, software, networks or infrastructure) role is to:

  • Improve the efficiency of the business process – make it easier and yes, faster to execute; to help it cost less for the organization to support
  • Increase the effectiveness of the process - provide the opportunity for that process to create new products or services or to deliver existing ones in new ways; improve the experience of the customer of the process; reduce errors; create more useful data for analysis and product/service improvement

Technology plays an enabling role. A very important role but not the only one. People have to execute the process. Leaders must oversee the process and support the people executing it.


When process improvement projects are called technology projects (because they happen to be implementing a new system), they are set up to produce subpar results. If the “project” is just about the technology without considering the people needs and skills and the leadership requirements, the “project” is building a one-legged stool. There is no balance and it will not work well.


In the next post I’ll explore technology’s role in building people and leadership capability. As with building process capability there is promise, yet too often it is unrealized.




Do a Reality Review

Posted on May 7, 2010 at 12:08 PM Comments comments (0)

External pressures like recessions, new competition or new regulations force you to look at your products or services and the processes used to deliver them. You move into improvement and change mode because there is no choice.


But when things are going well, the external world isn’t knocking hard on your door and no one in the company seems to be complaining, it is so easy to sit back, smile and enjoy. That is certainly understandable and maybe, for just a short period of time, a necessary rest period for the organization.


Do not rest for long! You have been given a unique and precious opportunity to examine your business, to do what I call the Reality Review.


What is this?

A Reality Review is a brutally honest assessment of the current state of your business or some piece of it. Here’s a sampling of the questions for a review:


For a key business process:

  • Is it as effective as it could be?
  • Is it as efficient as it could be?
  • Could error rates be lowered?
  • Is it shareable or locked inside a key employee’s head?
  • How many people and handoffs are required to get the job done?
  • Do the people involved have the skills they need to perform well? Is the time from hire to proficiency too long?
  • Is recruitment too difficult? Does it take too long?
  • For an existing product or service:
    • Does it sell as well as you’d originally hoped? Again, be honest, it may be selling but is really achieving what you believed possible when you started it?
    • Do your people know when and how to sell it? Do they like to sell it?
    • Could customer satisfaction be higher? Do you know what your customers are saying?

    A Reality Review can also take a look at your people management, performance management and leadership strengths and weaknesses.


    The point is to take the stance that good can always be better. In fact it is often also true that good can hide pockets of bad.


    Why do a Reality Review?

    Beyond assuming that you want to know what is working and what is not, here’s a list of reasons that all have bottom line impact:

    • You will find places where processes can be improved or streamlined. You will (hopefully!) find many things being done right and you get to celebrate that with your people and share those good practices to improve other areas of the organization.
    • You may find products or services that simply need to be retired. Getting rid of a product/service that is a drain on organizational resources allows more focus and attention on the products/services that are doing well. It also opens up the chance to explore new products/services to make use of the organizational capacity no longer needed for the old product/service.
    • You’ll be in a much stronger position to take on external pressures that will inevitably be just around the corner. You may well inoculate your organization from some competitive pressures by staying ahead of the pack.
    • Through doing an honest review of the current state you’ll be better positioned to communicate the changes needed to the people in your organization.

    How do you do it?

    You can and should gather some statistics. I would certainly want them as part of the overall picture. But too many organizations get buried in the “data trap”, arguing about which data should be collected and what the results of the data collection are actually saying.


    More importantly, statistics are a passive review. A true reality review requires something far more active. Consider:

    • The documented process is almost never the actual process that gets executed.
    • The explained process will be what someone thinks you want to hear.
    • The only way to really understand what is being said to customers – at all points of customer interaction – is to hear it.
    • Customers may fill out surveys but this cannot replace focused conversations on their experiences with your products and services.
    • Changes that are made on actual vs. documented processes achieve real improvement.

    You, or a small project team needs to get out there, live it, see it and experience your processes as your people do and your products and services as your customers do.

    • Sit with the people doing the work. Ask them to talk through their work as they do it. Get them to explain their understanding of what they are doing. Ask them what would work better.
    • See where they are interrupted and what impact that has on their ability to execute.
    • Experience how they use the automated systems provided to them.
    • Look for the sticky notes plastered on the screen and desk that indicate some process or system is not intuitive and requires a constant reminder.
    • Sit in on customer interactions.
    • Take the opportunity to ask customers for feedback.

    An active review does not have to take a lot of time, though it does require some planning to ensure the time used is effective in discovering the reality of your process, service or product.


    A side benefit to this active observation and review is that you will discover data points to track that will end up making your statistics much more meaningful in future. A quick story to illustrate…


    A few years ago I worked on a project that was focused on streamlining system interactions for several hundred customer service assistants across the country. The project team spent time sitting in regional offices getting a first-hand view of how the existing systems were used. While in these offices every team member watched the computer network go down unexpectedly, often several times a day. Input data was sometimes lost and the interruption time to restart and get back on track was several minutes. There were no help desk statistics to show this was an issue. People had given up calling to report something that no one seemed to do anything about anyway. The project team put some simple code into the new system they were delivering to track when the system did not close cleanly and were able, over just a few weeks, to statistically prove the network problem. The problem did get fixed and tracking was put in place to ensure the systems really were available and reliable on an ongoing basis.

    Make Reality Reviews a part of your culture

    You do not have to wait for down time to do a Reality Review. Every project has the opportunity to embed active observation into its work. Not only will the results of that project be improved, you will continually find areas for improvement.


    You will build leadership credibility. Your people will feel like they are really being listened to and consulted about the direction of the company.


    No one should bury an organization in constant change and knowing when to act on improvement opportunities is key. But go ahead and be the restless leader. The one who can take pleasure and pride in what has been accomplished while still looking for opportunities to further grow organizational capability.