Category: CEMMethod

First Steps into Outside-In Thinking Part 3 – What is OI in the context of the BP Group?

1. Outside-In is a philosophy and method of managing an organisation by understanding and

delivering Successful Customer Outcomes.

2. Outside-In Process optimizes value-delivery to customers. By fusing customer-driven process with customer-centric strategies, O-I creates successful customer outcomes (SCOs) – the foundation for achieving sustainable growth and profitability in an increasingly buyer-driven marketplace.(Customer ProcessOne Council, May 2010)

There are many accreditations in the process space. This BP Group community is sponsored by www.bpgroup.org which in turn advocates the Certified Process Professional qualification ( http://www.certifiedprocessprofessional.com ).

There are five levels of recognition:
• Certified Process Practitioner (CPP-Practitioner)
• Certified Process Professional (CPP-Professional)
• Certified Process Master (CPP-Master)
• Certified Process Advanced Master (CPP-AdvMaster) 

• Certified Process Champion (CPP-Champion) 

 

A significant part of that hands-on learning is focused on Outside-In and includes discussion of various methods such as CEMMethod

There is a rapidly developing cadre of people and organisations delivering Outside-In training, consultancy and advisory services with case studies, presentations and podcasts at http://www.oibpm.com

The Annual BP Group conferences have a strong flavour of Outside-In with notable organisations who are the pioneers of Outside-In present and delivering case studies, tutorials and workshops. Not least of which is Steve Towers book – Outside-In,
now in its fifth edition ( http://www.outsideinthesecret.com )

First Steps into Outside-In Thinking Part 1 – The Challenge

First published by the BP Group 3 years ago here’s some of the mindset behind Outside In.

If we consider the challenges of succeeding in business in the 21st century, most major companies would come up with a similar list:

When they talk about their customers
> Competition is fierce, global and increasing.
> Customers have become rebellious, they realise they have the right to alternatives and they frequently exercise that right.
> Customers have high expectations, they demand more and unless that demand is met they will go elsewhere.
> Customers demand choice, comprehensive information and the best price.

When they talk about their operations
> Operations, structures and business flows are becoming ever more complex
> The process of change is becoming ever more complex as the obvious improvements are delivered and the focus is on looking for new improvements often with diminishing returns
> A significant proportion of change projects under-perform and do not achieve the desired outcome
> There are so many alternative methods to effecting change out there it is difficult to select which one makes most sense for my business

When they talk about their overall business performance
> I fundamentally believe I offer a superior product and/or service but I’m still struggling to make the returns I believe possible
> I strive to be a market leader, I believe we have the capability to be a market leader but the issues above prevent me from getting there
> It is difficult to markedly cut my costs without impacting my service levels
> The impact of the global recession has affected my business and our fortunes won’t markedly improve until the business environment improves.

There may be additional comments however this is typical of observations from companies all over the world. And it is getting worse.

It isn’t though we don’t have choice in improvement approaches. As of 2010 there were over 6000 improvement methodologies all geared to helping organisations improve performance. How do you decide which one works best? How do you ensure sustained business improvement when the average CEO in the 21st century lasts 3 years and each new regime brings fresh ideas but a lot of the same issues?

See more of the thinking, practice and qualify as a Certified Process Professional (CPP) www.bpgroup.org

Is Process Excellence growing/declining?

Great question posed in Lean Six Sigma and Process Excellence by Vijay Bajaj. There are several indicators and one of the leading is the amount of internet interest. So let’s look at some stats courtesy of Google.

 (Blue BPM, Red SixSigma)

So at first glance BPM is in the ascendency, SIx Sigma declining, however let’s factor in Lean for the same period against BPM.

This time we see BPM flat against a more volatile Lean, however Lean had its greatest interest back in 2007.



A much more interesting trend, which impacts all three aspects of Process Excellence is the recent emergence of Customer Experience Management. WIth progressive PEX types pushing the boundaries of process Outside-In rapidly, the migration to “the customer experience is the process” seems well established.

 Is CEM the natural evolution of PEX? It certainly seems so.

5. Breakpoints – The Five Steps for Reducing Costs

The Five Steps for Reducing Costs
Describe your Target – The target is the “area” we are seeking to improve. Most often this would be thought of in terms of a “process” but there is no restriction on how we define the target areas we are working on.

Identify Break Points – For the target area, all of the Break Points that exist need to be identified. They also need to be described well enough that we (and others) can easily recognize them at any time.

Describe your Actions – Describing your actions is the way you clearly identify the steps you could take to eliminate causes of work. By identifying Actions and the number of Break Points each Action will eliminate, the benefit from each Action becomes clear.

Do the Cost and Benefit Assessment – The Cost and Benefit assessment adds several items that are important in helping us build our Cost Reduction Plan. What we need to know is: How Much? How Long? How Beneficial?

Build your Cost Reduction Plan – Using the Cost and Benefit assessment we can now build our Cost Reduction Plan. We do this by choosing which Actions are to be taken, and the order they are taken in.

  
Let’s explore these Steps in more detail:

Step 1 – Describe your Target Area,

ideally in terms that are understandable to others in your organization. Your Target Area will often be a “process,” as this is one of the most common terms used in describing the work people do.

Step 2 – Identify Break Points.

For the target area, identify each of the Break Points that exist within it, then record them in a descriptive enough way that others (and you if you come back later) will immediately know what you mean.

Note – This may initially present a challenge as it is not something we commonly have done in the past. Persevere and do your best to identify the Break Points in your target area and enough information will be available for you to build your cost reduction plan.

4. Breakpoints – Identifying them, fixing them and controling them

Do you follow up on others to ensure that activities they are responsible for are being done in a timely manner so you can get your primary work done?

Any time we “check” on something, we are doing so because a Break Point exists.

Do you ever need to “fight a fire”?

Every “fire” exists because of a Break Point, Moment of Truth or Business Rule.

What about meetings? Do you have meetings in order to get everyone “on the same page”?

Many meetings exist solely to coordinate and communicate the actions that need to be taken in response to “break downs” from Break Points and Moments of Truth.

How many actions do you take to confirm something got done, has been completed or to check on something to make sure it is in a particular place, with a particular person, etc?

Actions taken to confirm other actions are behaviors that arise from failures that have occurred in the past (we have learned our lesson) at Break Points and Moments of Truth.

How many times have you had to fill out one or more forms to “document” the fact that something got done?

Documenting normal work is a behavior spawned by process failure at one or more Break Points as a means to “reduce” the number of failures that don’t get “caught.” (This is called fixing the effect – which always leads to the creation of more Causes of Work.)

Remember, any place that a hand-off occurs for any interaction between any combination of people and systems, a Break Point exists.

What do you need to know to put this strategy to work for you? 
It’s simple. You are only five steps away from identifying the causes of work in your organization then eliminating them. You need to have a target, Break Points identified, Actions identified, Cost/Benefit Assessment and your Cost Reduction Plan.

3. Breakpoints – how much work do they create?

A variety of studies exist that place the percentage of time the average employee spends on non-value added work at 40% to 90%. Regardless of where you fall on that scale one thing is obvious…

Identifying and eliminating the causes of non-value added work presents an opportunity for cost reduction of at least 40%. And that’s a prize worth pursuing.

What are Break Points?

Any point within a process where work is handed off is a Break Point. There are four main types of Break Points:

1) person to person

2) person to system

3) system to person

4) system to system.

Break Points are places where stuff goes wrong more often than any place else. Handoffs fail, work is incomplete, and stuff gets duplicated in a cycle that produces a perpetual drain on the organization’s resources.

Like the baton hand-off in Track and Field relay races; if something happens at the hand-off, something unplanned, the next runner must stop running and deal with the resulting issue.

They can’t continue with the race, which is their professional skill, until they have dealt with the failed hand-off. So when something unexpected happens at a hand-off we must stop what we are doing and perform an activity that is nothing to do with our professional skill.

What could go wrong at a Break Point?

For the relay team, the runner waiting for the baton could start too early, either runner could drop the baton, the runner receiving the baton could start too late, either runner could use the wrong hand*, the baton could be slick for some reason causing it to slip… you get the point.

*Many Break Points cause work when the patterns we (people) are used to get changed for any reason. People always create patterns of work behavior. It makes it much easier for us to do things that have repetition. The patterns we’re talking about are not documented anywhere, they are the naturally evolving patterns people in our organizations create to help them do their work.

But these patterns are often violated. For example: a new person is involved (they don’t know the existing pattern), someone is using a different software program, somebody changed a form or document, a new policy went into place requiring people to follow a business rule in how they do a more generic activity like making a request or sending an email, someone’s job changed slightly and they have created a new personal work pattern, a new manager comes in, etc, etc, etc.

To identify with the concept of Break Points (BP) all you have to do is think about the work you do on a daily basis. How much of that work is caused by Break Points?

Think about it.

2. Breakpoints – the root of all internal evil and yet the Promised land?

That is the size of the prize the Break Points Toolkit targets – the rest of the non-value added work iceberg.
Non value-added work is consuming up to 90% of your employees’ time. Yet many of the approaches to increasing utilization are producing little benefit and may even be contributing to the problem. Yet there is a much easier and direct way to identify the causes of this non value-added work in your organization so that you can start eliminating them today!
A Google search on “non value added work” turns up over 104 million matches. It’s an issue we are all very aware of, one that is a source of continuing frustration because most often when we act to increase our utilization somehow the numbers never seem to hit the bottom line.
So what we are doing isn’t working.
We need something different, something that works. Perhaps there is a statistical method or scientific formula that will help us break through this success barrier?
Actually, all you need is a simple technique that allows you to identify the source of the non value-added work so that it can then be removed! 
It’s kind of like a tumor. Before X-Rays, Sonograms, and MRIs, it wasn’t easy to identify a tumor in the human body. With these tools many tumors are now very easy to identify. They stand out like a sore thumb.

For non-value added work our diagnostic machine is Break Points. They are the number one cause of work in organizations everywhere and yet most of the time we aren’t even aware that we should be looking for them.

Like those advanced medical diagnostic machines, using Break Points as our “cause of work diagnostic machine” makes it easy to identify the sources of non-value added work.

And once we have identified them we can take action to eliminate them. That’s where we are going next.

 

1. Breakpoints – those insidious internal handoffs

insidious – Proceeding in a gradual, subtle way, but with harmful effects:

Yup that is Breakpoints.


Most process improvement techniques focus on only a small portion of the improvement potential in every process… the tip of the iceberg if you will. 
How big is the opportunity resting out of our sight, hidden below the waterline of current process improvement practices? 
Recent research shows that as much as 70 to 90 percent of the work people do on a daily basis comes directly from Causes of Work and this work is NOT part of the “job” for which these people were hired! Instead, this is non-value added work that takes away from people’s ability to do their job.
Does this sound familiar? Can you identify places in your work or life where these Causes of Work are distracting you from what you really want to be doing?
Are you required to fill out this form, check up on that order, follow-up on those activities, fix the thing that is broken, find what got lost, or explain why this was done that way? 
Do you get tasked with finding the answer, knowing the rules, going to meetings (because), pushing something through, chasing down what really happened, explaining why you did this or that? The list goes on and on but you shouldn’t need to look very far in any part of your life to find all kinds of examples of non-value add work you are doing every single day!
The Break Points Toolkit explicitly targets these “hidden” wasters of time and money. Causes of Work are the “rest of the iceberg” for process improvement that, when addressed, lead to dramatic process improvement results regardless of what kind of process is involved or what kind of organization the process is in.
Can you envisage reducing the costs of your operations by 20%, 30%, 40% or even more than 50%?

Moments of Truth are fine but what about …

Breakpoints an Introduction
The last few articles have focused our attention on the primary cause of all work in our processes – Moments of Truth. Fix those and the benefits are dramatic, immediate and sustainable. However what about this internal work we are doing? All the hand-offs between departments, the relationships with business partners and the wider Supply Chain? That is where Breakpoints come in.

–>

What you will Learn
The Breakpoints Tool Kit provides the means to tackle internal bureaucracy and reduce/eliminate all those handoffs that cause all that work.
Recommendation
The BP Group provides a program built on 8 foundational methods, techniques and skills which help you to deliver triple crown benefits i.e. simultaneously reducing costs, improving revenues and enhancing service.
The steps are practical, sensible and focused on action. The approach provides direction to people who are responsible for organization performance improvement, process realignment and ensuring ‘outside in’ thinking at all levels of business.  If you fall into that category, the method and techniques will help you realize your performance and process objectives. The BP Group recommends this solid and proven approach to senior executives, managers and process performance professionals.
Ready? We start Breakpoints tomorrow. See you then 🙂
Steve  

5. Moments of Truth and their link to Strategy

The Five Steps to Winning the Triple Crown with MOT’s
Identify your Goal
Of course the overall goal is to improve customer satisfaction. But to achieve that goal we need to know what role we are acting within. This helps us know if we are educating, leading, directing or doing.
Describe your Target
The target is the “area” we are seeking to improve. Most often this would be thought of in terms of a “process” but there is no restriction on how we define the target areas we are working on.
Identify Moments of Truth
For the target area, all of the Moments of Truth that exist need to be identified. They also need to be described well enough that what was meant is easily recognizable to others or when we come back to our work at a later date.
“Blink” your Analysis
Judging the impact of Moments of Truth on Customer Satisfaction is a very subjective thing. It’s relatively easy for people to do, but very difficult to codify. It can best be done by looking at the Goal, the Target and the Moments of Truth all together. In most cases the Moments of Truth that are problematic will immediately become obvious.
Describe your Actions
Describing your actions is the way you build the direction, leadership vision or specific activities that need to be done for improvement to take place. Depending on what your Goal is, your Actions need to take the form that will help get the work you know needs doing, done.
It’s important to have a goal. If we don’t have a goal then it’s very hard to play the game to win! So in your MOT Plan you need a goal.
What is your goal?
While Improving Customer Satisfaction is the overall goal, the specific goals for people to help us achieve that are what is needed to get results.

Those specific goals could be several things depending on who you are and what you do. Let’s look at some examples and see how they change the nature of the MOT Plan goal.