Industry Challenge: Three Examples of New Process Strategy

How do you think the building supply industry will change it methods and tools for improving operations processes? How are you using technology or social media to become more agile? I’m interested in your comments about improving operations: customers, suppliers, and partners. Brad Power from the Harvard Business Review has a post about changing the process strategy.

Three Examples of New Process StrategyProcess Strategy

There are three fundamental ways that companies can improve their processes in the coming decade: (1) expand the scope of work managed by a company to include customers, suppliers, and partners; (2) target the increasing amount of knowledge work; and (3) reduce cycle times to durations previously considered impossible (as I discussed in my last post).

So how do you do this? As science fiction writer William Gibson said, “The future is already here — it’s just not very evenly distributed.” This is to say that you don’t have to wait until the end of the decade for some breakthrough technology to emerge; it’s already here, albeit in bits and pieces.

I’m collectively referring to these process improvement approaches as “Process Strategy 2.0”. They stand on the shoulders of the methods of “Process Strategy 1.0”: LeanSix Sigma, and Business Reengineering. Let’s explore what Process Strategy 2.0 is all about:

1. To streamline customer experiences in end-to-end processes, Process Strategy 2.0 will require aligned goals and supporting systems to manage work between partners.

The first major trend I see is the shift to global, virtual, cross-organizational teams of specialized entities that are knitted together to serve customers.

In a previous post I described how Forbes changed its article-writing process to include a huge stable of outside authors publishing autonomously and improved the reader experience by allowing them to leave comments.

To keep such a multiparty system from degenerating into chaos, virtual process teams must have aligned goals and support systems. Both Forbes and its external contributors (freelance journalists, authors, academics, and topic experts) want to maximize readership, so Forbes publishes the page view statistics for each piece and created an incentive payment program based on the audience contributors attract. Forbes had to provide tools to enable external contributors to easily publish text, photos, and video — and interact with readers and “call out” comments they want to highlight.

2. To manage the rising tide of knowledge work performed by a younger generation of employees, Process Strategy 2.0 will depend heavily on social collaboration tools.

A second major trend in the world of work is that low-skilled jobs are going away due to automation, while all jobs are becoming more analytical as “big data” provides workers with more information to make decisions.

To help manage the increased complexity of knowledge work, $20 billion financial services provider Nationwide Insurance has been pioneering the use of social collaboration tools. Chris Plescia, Marketing, Collaboration and Corporate Internet Solutions BSA Leader, told me that they are moving from an information “push” environment — sending out lots of messages on things workers need to know — to a “pull” environment, where workers search for information they need, get answers to questions, or access services. One success story occurred when a front-line associate in a call center posted online she didn’t like a new process. The senior leader saw the comment on their social platform and asked “why not?” People weighed in, and then they changed the process. Engagement has been very high — over 50% take some kind of action each month.

Getting a new social platform up and running in your organization isn’t easy. Participation rates are much lower at most other companies than at Nationwide. Companies who just try to let it evolve, don’t go after it with a plan and with dedicated resources, and don’t seek to create a culture around collaboration will fail. At Nationwide the key success factors have been (1) having senior leadership lead by example; (2) setting governance and policies to ensure security of sensitive comments; and (3) using tools that make collaboration easy and fun. Their collaborative space is designed to look like an “app store”, mimicking the environment that people have come to know on their mobile phones and iPads.

3. To speed operations and improvement, Process Strategy 2.0 will make greater use of quick experiments and more agile management processes.

The third major trend I see is the increasing need for speed in operations and improvement. Accelerating changes in technology, competition, regulation, and globalization demand that decisions get made faster at all levels.

Google’s engineering culture is a good example of a management system geared for speed. They like to run lots of experiments with new product or feature ideas and let the market decide which ones deserve further investment. It may look like chaos from the outside, but they aren’t afraid to fail fast and learn, or scale up quickly if an idea shows merit. One technique that helps early in new product or process development is to create a quick mock-up of how it would work and show it around. And innovation is built into jobs through “20% time” projects — engineers are expected to spend 20% of their time on projects that are creating and testing new ideas. The effect is powerful — this open technocracy means that workers at every level feel they can have a significant impact.

Many organizations will have trouble adopting Google’s fast approaches. They rest on a cultural foundation of openness, analytical rigor, and respect for workers. Workers are expected to not only do their work, but improve their work. And it takes an ability and willingness to invest with a long time horizon.

A revolutionary force over the last 30 years, information technology will change the way organizations operate even more radically over the rest of the decade. Process Strategy 2.0 will help organizations take a fresh look at ways of including customers and suppliers to redesign work, introduce social collaboration tools to support knowledge workers, and reengineer management processes for speed.

Question: Over the rest of this decade, how do you think your organization will change its methods and tools for process improvement?

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