“Process! That’s how we get things done around here!”
Craig Patrick, CAO, Summit Mining Intl.
While virtually every leader professes to understand and believe in the importance of process, we know from client data that over 70% of all business problems relate to process deficiencies of some type. Most processes are undefined, complicated, not consistently followed, not measured, and loaded with non value-added activities. Leadership often reacts to these broken processes by adding reviews, approvals, and more complexity, while missing the underlying causes of performance shortfalls.
When we press for details of leadership’s understanding, we quickly discover that many don’t know the basic process structure under their command and the essential customer – supplier relationships that exist in all organizations. Given this background, I offer following the essential reasons that all leaders should embrace process in running their organizations.
Why All Leaders Should Embrace Process
1. Process defines how work gets done.
A process is a series of tasks, events and decisions that consumes a product or service from a supplier, adds value to that product or service through some transformation, and then delivers a product or service of more value to a customer. Organization workflow consists of a series of business processes (e.g. Accounts Payable) that connects to deliver a larger business system purpose (e.g. Financial System). The further leadership gets away from the source of the work, the more likely leaders don’t know what’s actually happening on the front lines. It’s pretty common to hear a leader assure us that something isn’t being done when we know that it is.
2. Process provides a common language.
By using process language to describe the organization’s workflow, leadership is able to create a common understanding that provides many organization benefits, including the ability to compare performance across a variety of processes, to cross train people and develop their capabilities, and to benchmark performance against other organizations’ best practices.
3. Process makes things better or worse.
High-quality processes make an organization much easier to manage and employees much happier. Employee frustrations typically come from processes that are loaded with manual, non-value added activities that prevent them from doing their job well. A good process makes it easy to do the right thing and a bad process makes it virtually impossible to do so. We have found that the complexity of an organization’s workflow is directly related to the quality of processes operational in that organization.
4. Process gives measurement meaning.
Most organizations measure what is easy and not what is important. By assessing process elements and aligning process-based performance measures with strategic purpose and intent, leadership can drive organization performance improvement that creates sustainable competitive advantage. Every measure should have an underlying process (or business system) whose performance improvement is the goal.
5. Process feeds organization scalability.
We are often approached by new clients who struggle to scale their organization based upon inadequate process infrastructure. The key to scaling an organization is to engage staff to define, build and deploy strong business processes that create customer value and deliver repeatable outcomes. Superior business processes provide a long-term foundation for growing an organization that delivers predictable, scalable, and sustainable performance.
6. Process predicts management quality.
Strong process is a predictor of a well-managed organization. Best practice performance is enabled though clear accountability established by process so that work is actively managed and improved to create the desired outcome. To achieve this, leaders must rethink responsibilities in terms of process flow and logical handoffs created by connected process boundaries, aligning organization structure with workflows.
7. Process enables employee engagement.
Process provides the context through which employees can engage with their work. A process that is designed and continually improved by those who do the work will deliver the most meaningful value to the organization. When employees have a voice in how their work is done, they form a foundation for sustainable satisfaction and high performance well into the future.
8. Process deploys strategy.
Strong, reliable and capable processes make the execution of a leader’s intention possible. Understanding how processes perform relative to their expectations and capabilities provides a significant contribution to strategy formulation and deployment.
9. Process primes profit improvement.
Process improvement drives better performance in a variety of ways, all of which contribute to increased profitability. Process improvement strategies include (among many) business model standardization, better customer experience, reduced costs, increased efficiency, higher asset productivity, shorter response time, and increased revenues.
Process provides engine that powers performance.
Organizations make substantial investments in facilities, information technology, people, knowledge, and equipment to provide the infrastructure necessary for competitive success. These assets all contribute to the production of products and services that deliver customer value. It is rare, however, to see an organization make a comparable investment in process. When processes are weak, investments in these other assets underperform relative to their full potential. Strong business processes provide the engine that powers performance.