One of the common concerns for organizations is figuring out how to streamline and improve internal processes so their organization can become even more effective. So, let’s set the stage with a common definition of an effective business process.
An effective process meets the requirements of its end customer by providing a quality product or service while increasing productivity by eliminating errors, minimizing delays, maximizing use of assets, etc. Additionally, the process must be easy to understand, customer friendly, easily adaptable to changing customers and business needs, provide a competitive advantage, and remove waste (time, scrap, defects, etc).
Prior to implementing any process improvement initiative, it is imperative the senior leadership team determine how they are going to measure the effectiveness of any process improvements. Some measurements to consider include: customer complaints, warranty costs, rework, due date integrity, market share, backlog and rejects, or unacceptable products or services. How do you currently measure your organizations processes and their effectiveness?
Process improvement only works with contributor buy-in. Therefore, the next issue to consider is how to get your team members onboard and fully committed to any process improvement initiatives. Team members need to know senior leadership wants and encourages their input. After all, the employees are working and living in the processes, daily, so who better to help the organization make improvements to become more effective? Does your organization have a system in place that elicits and encourages contributor feedback?
After measurements have been identified and team member buy-in is established, the next step is to actually review current processes with team members to determine where and how the processes could be made more effective. Some results our clients have achieved through their process improvement initiatives include:
- Reduced a core organizational process by 50%
- Reduced annual complaint rate to 2%
- Increased efficiency by 518%
- Inventory tracking reduced from 3636 hours to 700 hours
- Process containing 118 steps was reduced to 68 steps
- Cost savings of $700,000
- 50% reduction in scrap
- 50% reduction on first production runs
How would streamlining and improving internal processes impact your organization? If your organization found extra cash through process improvement initiatives and increased effectiveness, how would your organization reinvest it? Specifically, how would that reinvestment impact your organization in one year, three years, and five years?
How long will you wait to make this kind of difference in your organization?