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Red Clouds – The Four Sources Of Improvement Opportunities

Process improvement opportunities can be found in many areas of the organization. The Perigon Method surfaces these many opportunities, which we call Red Clouds, as we map a business process and engage process teams.

 

Red Clouds come from employees who do the work.

As we talk to employees about their work, we typically find between 25 and 50 – sometimes as many as 100 – opportunities for improvement. We look for four different sources of organization opportunities.

  • Process definition. The way we’ve always done it. Sometimes a process is in place just because it’s the way it’s always been done. No one has reviewed or questioned the work. These typically include legacy problems that are considered “just the way we do business,” generally unsolvable and mostly overlooked.
  • Process analysis. Would the customer pay for it? Highlights opportunities to simplify, streamline, and remove non-value-added tasks from the process.
  • Discovery. What you find when you measure. Uncovers opportunities while measuring or assessing the process or product. When we begin working with most new clients, few process characteristics are being measured or monitored.
  • Feedback. How did we do? Generates opportunities through customer feedback, failure, or complaint. While the majority of companies have a customer feedback system, few do much in the way of analyzing, categorizing, and prioritizing the many opportunities created by that feedback.

By taking the time to create a detailed problem statement for each Red Cloud, the organization better understands the opportunity and what needs to be done to address it. We take clients through a consolidation and prioritization exercise to get at the root cause of the many Red Clouds that typically exist. It is common to consolidate opportunities down by 50 to 75% into a few core systemic issues.

We find that about 50% of all Red Clouds are Quick Wins and can be solved by a Process Owner within 90 days.

Process improvement opportunities should be sorted, categorized, and prioritized to make sure they are being addressed in the most effective way. Successful organizations systematically work off opportunities while additionally adding more sophisticated and important opportunities. An organization should never be without an active database of opportunities that are in process of being addressed.

 

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THE PERIGON METHOD!