- September 3, 2010
- Posted by: andreag
- Category: GrowthlinesHigh PerformanceInnovationSystems-Process-Improvement
You won’t realize the 20-50% improvement in process performance if you aren’t successful at innovating (def. the act of introducing something new). Yes, you can get some improvement in performance simply by improving an existing process, i.e., eliminating duplication, rework, mistakes, unnecessary effort. However, although it is far more challenging, it is in re-inventing the current process that the real leaps in performance are found.
Prerequisites to innovation
First prerequisite, the understanding that innovation is most commonly found where you least expect it. It typically doesn’t come from IT, rather, IT often enables or makes it possible. Innovation usually is based in simplicity rather than complexity and often arises from those who have the most intimate knowledge of how things are done now — that is, from those at the frontlines of the organization vs. the leadership. Thus, management has to begin with a leap of faith that those on the lower rungs of the organization can bring forth ideas that can indeed transform the business.
Second, all the keys that we have covered in this newsletter series to date are required. There is an old axiom about change that the first step you need is to “thaw” what is. We are locked into how we currently do it until our customers make known to us that they expect more and better. If that “why” is really internalized, then there will be a willingness and even a demand for change by those working in the system. Until that time, we are in the blissful state of denial and comfort with the present, however ineffective or inefficient it is.
So having met the prerequisites, how do we get innovation?
Keys to innovation
In PGS’ Process Advantage®, we have used a three-stage process that consistently results in innovative designs that improve process performance by 20-50% or more.
- Demonstration that Suspends Beliefs as to What is Possible
We employ a video that proves that an achievement or level of performance no one thinks is possible can be achieved. Although the conditions in the video can’t be replicated in a business, the video is successful in getting those in the session to see that the filters of their own experience to date limit what they believe is possible. The demonstration is successful in bringing about a cessation of self-imposed limits, at least for the moment.
- Discovery of Personal and Group Limits to Synergy
We then employ an exercise that puts pressure on teams to innovate. We present a problem, let the teams create a solution, then tell them that a ten-fold improvement over their first solution has consistently been reached by other groups. We then drive them to achieve that level of performance and assure that they feel the “win” of getting there. Having had the experience of innovating beyond what they initially deemed possible, they examine what enabled them to be successful and what their self-imposed barriers were to innovating. They then agree to suspend those barriers in re-designing the flawed process that is the target for the innovation project.
- Set a New Target Performance Level
The group is next asked to set a new target for performance of the process they are working on. Without fail, that new target is VERY ambitious, but in our experience is always met.
Innovative strategies usually fall into one of the following buckets:
- Empowering the CustomerThose of you who use Amazon or iTunes know that you are provided with tools to help you find what you want. Both companies keep a database that serves up ideas based on what you have wanted in the past. No salesmen, no pressure, no problem. You have the power to find what you need, get reviews from other users, evaluate alternative products. The customer is in control and loves it. And, both companies do this with no stores, no salesmen, a simple supply chain, very modest sales and marketing costs, etc. It is a win-win: customer feels empowered and organization gets the customer to do the work previously done by employees.
- Empowering the Front-end Employee
With this strategy, levels of approvals, review of work etc. are eliminated, the customer is able to get what they need and want now (reduced cycle time), and costs to deliver to customer are eliminated. Nordstrom does this best by having two simple policies: first, do whatever is needed to make the customer happy, and second, if in doubt, consult policy number one. No calls to supervisors, no waiting for approvals…“I have the power to satisfy the customer no matter the need.”
- Technology as an Enabler
Technology can both do the work formerly done by employees and can also manage the work of employees. One of our clients, a state department of transportation, employed a Workflow Management System (def. a computer system that manages and defines a series of tasks within an organization to produce a final outcome or outcomes). Work in any of three state offices could be managed from any location. Employee man-hours were nearly cut in half when this was coupled with the first two strategies described above. Examples of technology innovating process can be seen all around us as consumers. One side note, it is wise to have an IT resource in the room to assist design teams in optimizing the application of technology to gain the most from their innovative ideas. This prevents having to re-design the process once IT is consulted on how they can facilitate the innovative design.
Be sure you have the preconditions in place we have discussed in earlier posts and then do a gut check as to whether you are ready to trust your front line employees, if put in the hands of a good facilitator with good tools, to create the breakthrough you are looking for. If yes, then it is simply a matter of empowering them to do so.
If you would like assistance in assessing your readiness for innovation, send us an e-mail.
The rest of the story
To read the rest of the articles in this series on change click on any of the links below:
Change 1: Putting Customer Data to Work
Change 2: The Importance of Selling the Big “Why”
Change 3: Define the Scope, Understand the Potential and Assess the Readiness
Change 4: Let Those Who Do the Work, Design the Work
Change 5: Make Sure Everybody Wins
Change 6: Secure and Maintain Stakeholder Support
Change 8: The Importance of Data on Existing Performance
Change 9: Clarify Problems Before Innovating
Change 11: Grabbing the Low Hanging Fruit
Change 12: Sound Implementation Planning
Change 13: The Human Side of Change