Process Characterization: A CEO’s Tool for Improving Business Health
Issue No. 9
Have you ever noticed that sometimes you have two employees who are doing the same task? Have you asked for a report about sales and gotten a revenue report instead? Have you had one department in your company make a decision that worked well for them but caused another department to fly into a frenzy? Perhaps it’s time to take a close look at your business processes to see where they’re working – and more important, where they’re not.
What is It?
Process characterization is the orderly assessment and documentation of operational procedures and relationships. Process characterization gives you an overall view of your business processes, a specific indication of areas that need improvement, and a picture of the parts of the process that work well. Before a process characterization begins, you meet with your consultants to identify your improvement objectives. Do you need to shorten your closing cycle? Tighten inventory controls? Reduce your cost for customer support?
During a process characterization, your consultants conduct interviews with your employees, summarize the information into process steps and issues, develop easy to read graphics or maps depicting how the business works, and facilitate team meetings to review the maps and findings. You may be surprised at some of the double-work and disconnects that become clear during this process.
What Problems Does a Process Characterization Identify?
Most departments manage their own job functions well. However, it is possible for each department to exceed all of their goals while the overall system fails to meet management or customer expectations. This is called local optimization and may occur due to inadequate communication, improvement efforts that are not optimized across functions, or a lack of strategic alignment of goals among departments or functional areas. Any of these situations can create:
- disconnects where critical information is not communicated
- duplication of job tasks
- situations where consequences of one department’s decisions are not fully understood or even considered in the light of their impact on other departments, potentially hindering the other departments’ ability to achieve their goals
- unnecessary work.
What Happens During a Process Characterization?
A process characterization project can identify many of the above-listed situations. Information about how tasks are interrelated and the sharing and transfer of information among functions can be used to streamline the system and increase the effectiveness of the system as a whole. An effective system means an efficient team, which means a successful way to run your business.
A process characterization is very useful as a first step in developing a system requirements document, defining and documenting work procedures, or enhancing employees’ understanding of the overall business.
Deliverables
The final deliverable is a Process Characterization Report that includes the following:
- As Is” process map: The “As Is” process maps document the flow of the work as it exists before improvements are made. The maps, based on the Rummler-Brache methodology, depict the flow across departments and functional areas.
- List of Disconnects: Areas where process steps are missing, deficient, or add no value are graphically associated with the process on the maps; these areas are good targets for process improvement.
- Findings Summary: Grouping of disconnects into categories called Findings.
- Suggestions for Improvement: Suggestions made by Team Members during interviews or as part of the Team Meeting.
- "Should Be” process map: The “Should Be” map documents the ideal process for the future.
- Action Items: This lists the steps identified by the Team to move towards the “Should Be” process and eliminate the disconnects defined during the “As Is” meeting.
Process characterization may be just the course you need to take in the new year to get your business into top shape. Remember, a smooth flow of information maximizes all your corporate assets.