Consider a New Design's Implications

Talk about how the new process might affect your company's structures, employees, customers, and systems.

To further gauge the feasibility of your redesigned process, discuss the organizational ramifications of the redesign with your team.  Talk about how the new process might affect your company's structures, employees, customers, and systems.  The table "Examining a Redesign's Organizational Implications" shows examples.

Organizational Aspect		Wil the new Process Require
Structure		The creation of new jobs, departments, or reporting relationships, or major modifications of existing structure.
Employees		New skills, knowledge, and expertise that must be acquired by training existing employees or hiring new personnel?
Customers		New marketing plans or other communicaitons to inform customers of the redesigned process and to help them use it
Systems		Entirely new systems--such as new IT infrastructure--or the significant modification of existing systems?

ACTION POINT:  Depending on the nature of your redesign's organizational implications, you may decide that your team's proposed process needs further changes. 

The Purpose of Profit

Profit is the ultimate test of business performance.

Profit serves three purposes.  One is it measures the net effectiveness and soundness of a business’s efforts.  Another is the “risk premium” that covers the costs of staying in business-replacement, obsolescence, market risk and uncertainty.  Seen from this point of view, there is no such thing as “profit”; there are only “costs of being in business” and “costs of staying business.”  And the task of a business is to provide adequate profit.  

Finally, profit ensures the supply of future capital for innovation and expansion, either directly, by providing the means of self-financing out of retained earnings, or indirectly, through providing sufficient inducement for new outside capital in the form in which it is best suited to the enterprise’s objectives.

ACTION POINT: Decide to pull the plug on an unprofitable business if it is not covering the cost required to stay in business or providing enough capital for future growth.

Envision a Better Process

Define performance metrics related to:

In addition to brainstorming ways to improve the process determine how to measure the new process's performance.  Define performance metrics related to:

• Customer satisfaction - for example, "Number of times customer has to phone the company before getting their problem solved" or "amount of time on hold."
• Quality - such as "Number of errors in assembly, or pick, or delivery."
• Cost - such as "Amount spent per quarter on parts."
• Cycle time - for instance, "Number of hours to assemble one unit of product."

ACTION POINT: Direct process improvement toward the activities that will impact the metrics listed above.

Envision a Better Process

 Be sure that the ideal process directly addresses the business problem or opportunity identified in the project goals. 

With your team , visualize what an ideal process would look like.  Be sure that the ideal process directly addresses the business problem or opportunity identified in the project goals.   Brainstorm ways to make the process better.

During the brainstorming, set aside the "as is" process flowchart, so new ideas won't be influenced by the status quo.  Then think about ways to improve the process's performance.  First, think about ways to     exceed customers' expectations.  Could the accuracy, speed, and quality of the process be improved?  How might the process be improved to make it easier for customers to do business with the company?

Second, consider ways to cut costs.  Could steps be eliminated form the process to reduce the number of resources required or reduce the cost of the resources used?  Third brainstorm ideas for reducing cycle time--the total time it takes to complete the process.  Could requests for clarification or information be eliminated to speed up the process?

ACTION POINT: When improving a process consider ways to: exceed customer expectations, cut costs and reduce cycle time.

Redesign Your Business Process

...redesign the process so that it produces the outcomes you're looking for.

You've analyzed the existing process that you identified for improvement.  Now it's time for your BPI team to redesign the process so that it produces the outcomes you're looking for.  The redesign process consists of these steps:

• Envisioning a better process
• Testing your team's ideas
• Considering the implications of a potential redesign
• Documenting your redesign
• Gathering feedback from stakeholders and refining the redesigned process

ACTION POINT: At the end of your redesign phase, you should have a set of documents describing the proposed process redesign that is approved by management and other key stakeholders.