Author Topic: Process Wise!! Business Foolish!!  (Read 23 times)

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Process Wise!! Business Foolish!!
« on: November 04, 2015, 04:38:43 pm »
Often we handle situations in organizations where an project has to be implemented (or) equipment has to be installed (or) partner / service provider / vendor is to be engaged and similar such business enabling initiatives.

The irony in many such situations like this is that the actual time spent in the planning, evaluation and decision making activities is much longer than the project implementation time frame itself. Even worse, many times initiatives are "false started" and never see the end of the day leading to the organization syndrome "lets explore / let's check it out " culture

To give a real life example, our firm quotes for project engagements in areas like Six Sigma implementation to clients. Very often, the cycle time from enquiry to closure is so long that by the time we get the deal, it could be as long as six months (sometimes even longer).

When I joined the private sector, I used to always think (probably many of you think similarly as well) that private / professionally managed firms are faster in decision making than public sector and government organizations, but I would be very curious to see if this is in fact the truth (whether there is any research that proves this conclusively of "significant" difference!!)

If the organizations actually worked out the potential loss due to such inordinate delays in decision making and how it impacts their business, I am sure the cost of such "delayed" decisions will be quite phenomenal.

For example, assuming we assist a company to launch and deliver say ten six sigma projects in the first wave and every project has a projected annualized savings of conservatively INR 5.0 lakhs (approx USD 12,000), for every month delay in launching the project, the company is perhaps losing a savings potential of INR 42,000 (5.0 lakhs divided by 12 months) (approx USD 1000). For ten projects the estimated loss is a cool INR 4,20,000 (USD 10,000). This is perhaps equal to or much more than what the company will actually pay the consultancy / service provider to assist them in the Six Sigma implementation. I am sure you can now see the point very clearly

Unfortunately, very few organizations are able to appreciate the business loss due to delayed decision making. Very rarely do companies even track their "agility" on decision making (for instance how long does it take for the company to "take decisions" on business impacting change initiatives or projects). When this syndrome exists in the company across so many initiatives and projects, imagine the business loss on account of such "snails pace decision making"

I believe much of this malaise is due to the fact that "delay" is considered OK because "our company wants to take the right decision". We all know and well understand that "right decisions" have a context and fully depend on the data and information available for the management to evaluate and take a call. While numerous things change in organizations, I find the "speed of decision making" and "speed of implementing decisions once taken" still operates at "vintage car rally speed levels".

While there are few exceptional organizations that have crossed this barrier and ensure they are "Truly agile" a large majority of companies still get mired in the organizational hierarchy which take over decision making processes in its own sweet snail's pace. Even funnier, much of this gets justified by saying "See - we have to follow a process you know, so it will take some time" (If you ask how much time it will take, often you get just a "blank response" or "open ended statements like "it depends"

Why does this happen?

I find the following reasons why this seems to happen

Lack of strategic planning and execution approach, poor cascading and lack of understanding of organization strategy, focus by mid/lower level executives and staff, hence "lack of clarity on priorities" leading to inordinate delays and repetitive circular communications. Adding to this, a weak linkage of "reward and recognition" mechanism to strategy execution and performance delivery.

Lack of proper organizationally agreed "objective framework" to take meaningful decisions based on actual data collected about the projects (often "price and budgets" are the deciders over other important business competitive advantage drivers like "need to be agile", "quality leadership" "innovation" etc.,). In fact the objective framework should also address the impact to the organization for every day's delay in decision making and if it gets reviewed on the management council, I am sure management can see the "Cost of poor quality" impact of holding back decisions, instead of discussing at "feel and perception level"

Fear and insecurity that I (as manager) will be held accountable should something go wrong, so let me "sit on it" (or) "go with the flow" and when everyone is "comfortable", we will take the call. This is also accentuated due to working in a "subjective" manner or lack of adequate preparedness on point 2 above

Lack of "financial" empowerment (even to take small yet business impacting decisions). Everything goes through the "proper channels" and I am just a cog in the wheel, pushing it to the next in the chain finally to the finance guys to get it cleared prior to moving forward.

Of these, I find points 1 and 2 are actually the biggest stumbling blocks that even influence Points 3 and 4.

Adoption of structured strategy deployment frameworks like Balanced Scorecard, Data based decision making, true empowerment (including financial) and encouraging the team to take calculated risks as well as "business centric measures" to track the impact of "decision making and planning processes" and aligning rewards and recognition mechanisms appropriately will to a great extent help the organizations mitigate this syndrome and get to become "Business Wise" in due course

I am sure this "disease" is much common in your organization as well (many places it is at an "advanced stage") as well. I am clearly not "against" process driven organizations, but you will note that what I am referring in this article is something much beyond that

Feel free to add on / post your thoughts and experiences as well as suggestions you wish to propose.

Cheers!!

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