Continuous improvement is increasingly being touted as a competitive differentiator, but all too often companies are their own worst enemies, writes contributor Ýr Gunnarsdóttir as she summarises what she views as the main barriers to continuous improvement. Continuous Improvement (CI) is something of an umbrella term and may encompass a variety of disciplines and methodologies including Operational Excellence, Business Process Management, Performance Management, Quality Management, Compliance, Lean, Six Sigma and more.
Despite all the different terms, techniques and methods available, there are commonalities between these different approaches – they all seek to continuously improve business processes in order to enhance business results. Increasingly, continuous process improvement is being touted as a competitive differentiator; analyst firm Gartner predicted last year that “between now and year-end 2014, overlooked but easily detectable business process defects will topple 10 Global 2000 companies.”
But all too often companies are their own worst enemies when it comes to process improvement. In an article for the Wall Street Journal last year, for instance, Dr. Satya Chakravorty,a professor of operations management at Kennesaw State University, claimed that nearly 60% of all corporate Six Sigma initiatives fail to yield the desired results, comparing process improvement to weight loss programs that “start off well […] but all too often fail to have a lasting impact as participants gradually lose motivation and fall back into old habits.”
So what’s happening? If continuous improvement is so critical to the health of an organization – why is it so difficult and why are so many projects doomed to failure? Here are what I consider the main barriers to continuous improvement.
Barrier #1: Difficult to foster collaboration between multiple stakeholders
So many stakeholders need to be engaged in continuous improvement: Process Owners and SMEs, Process Analysts, Lean / SixSigma specialists, Quality Managers, IT, Training. If you’re in a highly regulated industry the list of stakeholders probably includes Risk and Compliance Officers as well. That list probably just covers who needs to be involved in process capture, review and agreement. When you roll-out change you’d better add to that list all your employees affected by the change, who need to adopt new ways of working. With multiple initiatives that are likely to be at very different lifecycle stages, how on earth do you get this community focused and working in unison?
Barrier #2: Difficult to identify which processes to prioritize improvement efforts on
There’s no shortage of good ideas for what could be improved at any organization. But how do you prioritize? For some of you the corporate strategy may be clear, for others you may have a sense of initiative overload and just a barrage of urgent priorities. How do you assess improvement initiatives and evaluate them in terms of value and priority to the corporate strategy and business imperatives?
A major contributor to such difficulty in agreeing priorities for improvement is likely to be Wrong or Fuzzy KPIs.Are you measuring the right things? Do the KPIs connect to the strategy? Can you relate the KPIs to relevant processes? Do the right people look at the right measures? Are they empowered to do something constructive as a consequence? (Performance Management vs. Performance Reporting.) Measure too much and you could be paralyzed by information overload? Or perhaps you haven’t got timely and relevant data you can trust to base sound decisions on. It’s easy to see how identifying what improvement initiatives to prioritize is so often cited as the main barrier.
Barrier #3: Ill-suited Process Management tooling
There’s no shortage of business process management software to choose from, but either of the following situations could undermine your CI efforts.
Process Management tooling is inadequate
Paper based methods and Microsoft Office or Visio are ubiquitously available and seen as the free (or already paid for) option. But processes are supposed to be treated as assets. They need capturing, analyzing, improving and deploying or else you’re not going to exploit these valuable knowledge assets to best effect. Some sort of Business Process Management tooling will ultimately be required for CI to operate efficiently.
Process Management tooling is too complicated
Your IT department blew the budget on bloated business process management applications which met their automation goals. Now they’re trying to impose such tooling on the business. “You’d better use it, we paid a fortune for this”, may sound familiar? Although automation is an important aspect of process improvement, the tools used need to align with the different audiences. If the learning curve is too steep such process management tools will be a barrier to engaging the right people in process ownership and improvement. The risk is that the business audience might throw in the towel and go back to brown paper, MS Office and Visio.
Barrier #4: Governing / controlling change (to meet compliance obligations)
If you’re in a highly regulated industry you may be beset with Standard Operating Procedures and rigorous document controls which make agile analysis and deployment of change a real headache. But if you need to regularly prove to auditors that your processes, procedures, controls and compliance obligations are all under control, you’re going to have to contend with a considerable governance overhead.
Barrier #5: Lack of employee engagement
Employee engagement challenges can be considered from two perspectives. How do you achieve adoption of change by the employees? How do you foster sustained commitment to bottom-up improvement? Let’s consider these in turn.
Enforcing adoption of change by employees
Just like the best made plans, your new shiny and improved processes will deliver nothing if employees are ignorant of them, forget them or just plain fail to follow them. And by definition CI means a continuous drip feed of improvements. The risk is employees get change-exhaustion, and will soon become skeptical or even hostile to continuing change, if you communicate with them inconsistently. How do you give them a single source of the truth for all processes and procedures? How do you make it easy for them to find what they need, know which changes impact their role? And how do you know that they read and understood what’s required of them?
Gaining bottom up contribution and commitment
How do you empower all of your employees to get involved in CI? How do you enthuse and energize them, not just informing them of change but ensuring that they can contribute to the improvement process themselves? Are the methods which you use to do this effective? Can you harness new technologies such as enterprise social platforms to facilitate this bottom up contribution, or are such tools just likely to contribute to unstructured information overload?
Ýr Gunnarsdóttir is Head of Continuous Improvement at TIBCO. Ýr has over a decade’s experience of leading business strategy and process & performance management initiatives. She has been instrumental in developing the Lean Management and Operational Excellence approach with a large number of global clients, enabling them to enhance and align strategy, business planning and KPIs with the reality of daily operations in the spirit of Continuous Improvement.