Collaboration is the key

August 2008 from CAmagazine and written by Michael Burns – "Have you ever watched a teenager carry on multiple conversations on Facebook? The younger generation seems to instinctively know the value of pooling resources. They tend to share information more easily than their elders do.

At a corporate level, working together toward a common goal is called collaboration. The concept is gaining ground among successful companies, who see it as the cornerstone to improving business process and attaining business goals. Those goals could be anything from completing an annual budget to building an airplane.”

The New Brood of Best-of-Breed

July 1, 2008 from Business Finance – “Today's Best-of-Breed software market offers more to dazzle CFOs than ever before. The pace of innovation is fierce, slackening only when vendors pause to digest their gains after the waves of consolidation that periodically sweep over each sector.

The governance, risk, and compliance (GRC) category, for example, continues to attract new entrants and to generate a bewildering variety of applications for mandates ranging from email retention management to enterprise risk management. John E. Van Decker, research vice president with Gartner Inc., points to a burst of innovation around reconciliations management: “Financial governance software is starting to bring together process-management-type solutions for all of the activities that you need to do before you close the books. These may or may not be managed in larger systems, but you need some type of process to line up these activities and ensure that these things are done...”

Plus, a best-of-breed package can be an attractive option for companies that don't want to take on a mammoth project at this point. Many organizations are “looking for something that can provide incremental steps to value,” Van Decker notes. “We're also starting to see more use of software-as-a-service, where companies may want to do something on a 3-year basis, but with the understanding that by the end of that period they will have implemented a much larger set of applications.”

180 View – You will also find lists of products in this article for Corporate Performance Management (they call it Business Performance Management), Business Process Management, Spend Management, Cash Management, Receivables and Collection Management, Fixed Assets Management, Tax Management, Expense Management, GRC (Governance, Risk Compliance) Management and Project Portfolio Management.

We have also seen that some companies try to save time and costs by taking a best of breed product. This is can be a good strategy as long as there is not excessive integration required.

Investing in the IT That Makes a Competitive Difference

July-August, 2008 from Harvard Business Review – “…The mid-1990s marked a clear discontinuity in competitive dynamics and the start of a period of innovation in corporate IT, when the internet and enterprise software applications—like enterprise resource management (ERP), customer relationship management (CRM), and enterprise content management (ECM)—became practical tools for business. Corporate investments in IT surged during this time—from about $3,500 spent per worker in 1994 to about $8,000 in 2005, according the U.S. Bureau of Economic Analysis (BEA). At the same time, annual productivity growth in U.S. companies roughly doubled, after plodding along at about 1.4% for nearly 20 years. Much attention has been paid to the connection between productivity growth and the increase in IT investment. But hardly any has been directed to the nature of the link between IT and competitiveness. That’s why, with help from Harvard Business School researcher Michael Sorell and Feng Zhu, who’s now an assistant professor at USC, we set out two years ago to compare the increase in IT spending with various measures of competition, focusing on three quantifiable indicators: concentration, turbulence, and performance spread…

While it’s true that the tool kit of corporate IT has expanded a great deal in recent years, we believe that an overabundance of new technologies is not the fundamental driver of the change in dynamics we’ve documented. Instead, our field research suggests that businesses entered a new era of increased competitiveness in the mid-1990s not because they had so many IT innovations to choose from but because some of these new technologies enabled improvements to companies’ operating models and then made it possible to replicate those improvements much more widely.

CVS offers a great example. There’s no shortage of people looking to fill prescriptions—or of outlets ready to handle those orders. So CVS works hard to maintain a high level of customer service. Imagine senior management’s concern, then, when surveys conducted in 2002 revealed that customer satisfaction was declining. Further analysis uncovered a key problem: Some 17% of the prescription orders were being delayed during the insurance check, which was often performed after customers had already left the store. The team decided to move the insurance check forward in the prescription fulfillment process, before the drug safety review, so all customers would still be around to answer common questions such as, “Have you changed jobs?” This two-step process change was embedded in the information systems that supported pharmacy operations, thereby ensuring 100% compliance.

180 View – Implementing a new system is a great opportunity to improve business process. The CSV experience is a great example of identifying a problem with the existing system and leveraging the new system to fix the problem. Sometimes the solution is right out of the box or just requires a little tweaking.

Why Budgeting Fails

2004 reprint from Harvard Business School – “When Jack Welch described the budgeting process as the “bane of corporate America,” he was articulating the frustration of many senior executives and academics who recognize that this annual exercise is rarely justified in today’s fast-changing, highly competitive environment…”

180 View – This older article still applies today. The article describes problems with the budgetinig process and suggests ways to improve it.

Optimizing Processes for Innovation and Agility

June 18 from CIO Update – “Working from current process models, process analysts and domain experts collaborate to generate to-be models that can satisfy the aims of business model scenarios. Next, they perform a gap analysis between the current process model and each to-be model to determine which processes need to be eliminated, streamlined, automated, or outsourced and to anticipate the potential impact of these changes on supporting applications and systems.”

180 View – We disagree with creating “to-be models” unless the organization plans to make any necessary system changes themselves or has unique requirements. We recommend understanding the problems with the existing business processes, but rather than creating the ultimate “to-be” process, we think organizations should work with their vendors, VARs or solution providers. There are usually multiple ways to get the job done. It is not necessary to always create a unique business process. Take advantage of existing or embedded business process for the routine work. You may need to do a little tweaking for some unique business processes. It only makes sense to build the "to-be" from scratch if the business process is not only unique but also contributes to an organization's value proposition, which describes the unique mix of product and services, customer relations, and corporate image a company offers or what defines differentiation.

BPM Goes Mainstream

April 3, 2008 from Baseline – “The good news is that technology to support business process management (BPM) has become widely accepted, with a majority of enterprises having BPM projects, according to a pair of recent surveys.

The bad news is that implementing BPM—which requires real process change to succeed—is no slam dunk. In fact, in a recent survey from Forrester Research a majority of IT professionals at 142 companies reported the type of mixed results from BPM more closely associated with a three-pointer.”

180 View – Another misunderstood acronym is BPM. BPM is software to improve business process. Just like all new technology, there is the usual hype and implementation based on the potential merits of technology. It’s not surprising that there are lots of problems if the technology is purchased for the wrong reasons. It could also be difficult if the tool is not integrated with the existing systems. The article says “The most unexpected finding… was the frequent use of BPM technology as a tool to support new product development and innovation”. Our view is that BPM does make sense when creating new processes from scratch. You have a clean slate and don’t need to worry about integrating existing systems, data or processes.

180 Systems launches three new web sites

ERP Portal

The objective for this site is to provide an unbiased portal to ERP (Enterprise Resource Planning) systems, ERP Value Added Resellers (VAR's) and relevant ERP articles.

CPM/BI Portal

The objective for this site is to provide an unbiased portal to CPM (Corporate Performance Management) and BI (Business Intelligence) systems, CPM/BI Value Added Resellers (VAR's) and relevant CPM/BI articles.

BPI Portal

The objective for this site is to provide an unbiased portal to BPI (Business Process Improvement) systems and relevant articles. BPI is about efficiency and effectiveness as well as about GRC (Governance Risk and Compliance).

Add one part tech, one part business smarts, hold the do-gooderism. What do you get? A whole new approach to charity

February 28, 2008 from Fortune Magazine – “Kiva is a nonprofit, but it has the heart of a Silicon Valley startup. Executives call it a "company." Rather than tax-deductible donations, users pledge interest-free loans. Standard-issue charities take as much as 40 cents on the dollar for administrative costs, but Kiva directs 100% to borrowers, thanks in part to free payment processing from PayPal… So far Kiva has attracted nearly 250,000 lenders and disbursed $22 million across 40 countries…”

180 View – Technology has the power to not only improve business process but also to improve our world. We predict Kiva will make a huge difference.

Performing a gap analysis

November 2007 from CAmagazine and written by Michael Burns – “In October, we talked about using the company responsible for your ERP implementation – often called the value added reseller or VAR – to help build your “to be” business process. The rationale was, “Why reinvent the wheel, when your VAR already has a solution or can easily leverage processes already embedded in its system?” You could go to a different VAR or solution provider but it’s a huge job to convert to a new system. It should be a last resort based not just on requirements but also on the VAR’s vision, the software developer’s R&D investment, and support capabilities…”

It’s The Organizational Change, Stupid...

October 22, 2007 from gantthead.com – “We’ve seen an inexorable effort to define, to document, to map and to generally improve our processes. Numerous consultants have attempted to argue that their way of representing processes by drawing boxes and arrows was new, proprietary and, most importantly, better. Literally thousands of them have simply bypassed that debate, and have spent hundreds of hours, days, weeks and months drawing lines and boxes on paper as they define and chart their customers’ “current state” and “future state”. The problem with all of this is that boxes, lines and arrows are just so much ink, Post-it notes and flipchart paper. They aren’t the processes, they’re simply the representation of the processes. Processes are how people work, collaborate, communicate, expedite, stall, obfuscate and in general do the work that they want to do while avoiding the work that they don’t…

What human beings bring to the table that process doesn’t is judgment. We have the ability to engage in critical thinking and reasoning. We are able to respond situationally, and recognize that the most appropriate course of action may be “it depends”. We can recognize a customer service challenge, and make the individual call that the customer needs a discount, or free shipping, or a compliment, in order to salvage the situation and keep them as a customer.

All of this completely defies the logic and rigid guidelines of normal business processes. I have never seen a process map with a box on it saying “apply judgment here”. I think it would be pretty awesome if there was, but so far this has been an elusive source of satisfaction for me…"

180 View – The author, Mark Mullaly, of this article challenges some of the current thinking about business process improvement. We think the problem Mark discusses is not in the process mapping but in the level of detail. If improvement is the objective of the process maps, then the level of detail should be only sufficient to identify a weakness or a control. By keeping the process maps at a higher level, the time to do them is significantly reduced and it avoids the “rigid guidelines” discussed in the article.

We agree with Mark’s closing paragraph which reads “Improvement isn’t simply about a faster way through the process. Although that can be part of the solution, it isn’t the whole solution. Improvement is about finding ways for people to better engage with their customers, helping them to enjoy their jobs more and allowing them to feel engaged and challenged by their work. If we want better processes, we need to leave the space and capacity for judgment, for critical thought and for mixing it up a little. That’s where people create the most value.”

Our biggest gripe with the article is in the title. It’s cute but appears not relevant until the very end, but even then it’s not just organizational change that is the issue. It’s also about the other drivers of business process improvement including motivation, empowerment, skills and environment.

Documenting Business Process with Swimlanes

October 2007 from CAmagazine and written by Michael Burns – “Swimlanes are often used to document “as is” (i.e., current) and “to be” business processes. Although you’ll find swim-lanes very useful as a conceptual tool, you will still come up against one major obstacle, especially with the “to-be” version. This obstacle is of the human variety: gaining consensus.

Some people may not have a clue what should be done. Others might get mired in the details, missing the big picture. Others still may want to protect their turf and stick with the status quo. Others still will come up with grandiose or expensive solutions. You could have a real battle on your hands. Moreover, changing the swimlanes can be labour intensive…”

Control Matrix

August 2007 from CAmagazine and written by Michael Burns – “In the June/July issue of CAmagazine, we looked at swimlane flowcharting as a tool to document business process. But even though swimlanes bring clarity and consensus to a process, they don’t show controls or control weaknesses. So if business process improvement is the objective, you need a control matrix.

A control matrix can be used to document controls and control weaknesses, which are all referenced on the swimlane. The matrix should include controls over validity, accuracy and completeness of transaction data entry. As well, there should be controls over accuracy and completeness when master files are updated through transactions. These controls need to be considered for every transaction in the scope of the review. Security of resources (cash, inventory, etc.) should also be evaluated.

If improvement is your goal, you must also consider efficiency and effectiveness. These are often ignored by the auditors, which is unfortunate. Auditors could add value in those areas. Efficiency means maximizing the work that gets done using the fewest resources. Any duplication of work or rekeying of information should be easy to catch.

Effectiveness means the business process delivers value according to the organization’s critical success factors. CSFs are defined as activities that must be done well for the organization to be successful. A single department may be efficient and effective on its own, but this may be at the expense of the organization as a whole.

Poor Process Brings CRM Pain, Experts Warn

August 17, 2007 from IT Business Edge – “Companies have fallen into the trap of having thought that they have bought a solution, whereas what has really happened is that they have bought some technology. This technology may make things work faster – but if the over-riding CRM processes are bad, all you will do is hack off customers more quickly than you were doing before – and possibly more of them.”

180 View – The same can be said for any system. Implementing a new system is the best opportunity you will ever have to improve business process.

Growing Problems: The 2007 Working Capital Survey

July 1, 2007 from CFO Magazine – “Maybe it's globalization. As U.S. companies source more goods from the far corners of the world, it makes sense that they would stock more inventory as a guard against potential breakdowns in their supply chains. Or maybe it's economic priorities. With corporate coffers bulging like overloaded transpacific freighters, finance executives could be taking their eye off second-tier metrics like inventory, payables, and receivables. Whatever the explanation, 2006 marked the first time in five years that the 1,000 largest publicly traded companies in the United States (excluding automakers) failed to decrease the amount of cash they had tied up in working capital relative to sales.”

180 View – Check this article out for an explanation of working capital problems, metric definitions as well as actual metrics across industries. One of our methodologies for any system upgrade or replacement is to link key metrics with critical success factors. It would also be useful to compare your metrics to your industry. Unfortunately, the metrics provided are based on large public companies. However it’s not clear to us whether the metrics of smaller companies will vary significantly. On the one hand, larger companies can afford more sophisticated technology. On the other hand smaller companies can be more nimble.

Process Improvement: When More Is Less

June 25, 2007 from ITBusinessEdge – “Is there such a thing as too much process improvement?

Yes, says consultant David Taber. While process improvement efforts like Six Sigma tend to work well for established products, helping companies ensure that high quality standards are met, they aren’t that helpful — and in fact may be harmful — when companies are trying to develop new and innovative products.

180 View – We defer to the comment posted by Dr. Phyllis Thompson on July 3, 2007, who said

“Don Zook has it right. When I started working some years ago, the emphasis was on “systems and task analysis.” Other cutely named strategies (good for marketing and for differentiating the designer from competitive companies) complemented and extended these approaches to figuring out what is going right and wrong, and how to demonstrate and measure that a problem has been fixed (emphasis on measurably, by the way, since without metrics you can’t prove change has occurred).

Over time we have been inundated with the menu of (quite literally) thought-provoking tools . . .and more (e.g., remember, or like others, have you forgotten Management by Objectives?). . .that Zook enumerates. The problem arises when folks check their analytical skills and common sense (assuming they have both) at the door and think a tool will serve as the holy grail, showing them the way to “the solution.” What they forget is that they, not the tool, hold the answer.

Swimlane flowcharts

June 1, 2007 from CAmagazine and written by Michael Burns – “Remember drawing flowcharts? As accounting students, it’s something we all had to learn — and it was usually a struggle. The charts took forever to draw, and then were left to gather dust as soon as they were finished. But if you think flowcharts are passé, think again. Business process improvement is the new mantra of business, and process maps are a key component. Fortunately, we now have a flowchart technique called swimlane that is easy to understand and apply...”

Nine ways to screw up a good BI implementation

June 4, 2007 from CIO Insights – “According to a BusinessWeek Research Services survey released in the fall of 2006, 62% of respondents said recent large-scale or strategic business intelligence (BI) initiatives returned the value they expected. What about the other one-third?
Vendors touting BI like Cognos, Oracle, SAP, Microsoft, IBM and Business Objects say it can deliver knowledge, efficiency, better decisions, and profit to almost any organization that uses it—when done wisely.

Even the smartest companies can make some dumb mistakes when it comes to business intelligence.

Dumb idea #1 – Not having BI. No surprise that Gartner's 2007 survey of 1400 CIOs found BI was again the most highly ranked technology priority. A Ventana Research study in the fall of 2006 of 488 companies indicates that 53% of companies plan to implement query and reporting software, while 40% plan to implement analytics and data mining applications.

Dumb idea #2 – Not having a BI roadmap and buy-in. "Just build it, they will come," is stinking thinking. Too many IT departments build a data warehouse based on the assumption that once it is built, users will automatically see the benefit. They don’t, unless you get the users on board.

Dumb idea #3 – Reliance on spreadsheets. Admit it, you know people who hide behind spreadsheets. They do it because they are comfortable with them and because they know how to manipulate the numbers to satisfy the politics of their organizations. Not smart in the long run..."

180 View – We especially like the “stinking thinking” re “just build it, they will come”. The writer says you need users on board to overcome this problem. We agree that will help, but often users don’t know what they want. As the writer discusses in dumb idea #8 (“Not knowing how to define information requirements), BI needs to link back to metrics that support the business. We think that the metrics should map to the critical success factors (defined as those things you must do well in order to be successful). BI is not just about technology; more importantly, it’s about knowing what to measure and how to motivate.

What many boards and executives STILL don’t know about the health of their businesses

April 2007 from Deloitte – “In March and April 2004, the Economist Intelligence Unit surveyed 249 senior executives and board members around the world and interviewed a number of corporate directors in North America, Europe and Asia. The report concluded:“While the overwhelming majority of board members and senior executives say they need incisive non-financial information on their companies’ key drivers of success, they largely find such data to be lacking or, when available, of mediocre to poor value…

Almost three years later, Deloitte and the Economist Intelligence Unit worked together to see whether things had changed and conducted the research along much the same lines as before. A global survey fielded in December 2006 obtained responses from 175 senior executives and board members. Then, through January 2007, in-depth telephone interviews were conducted with senior executives and board members at large companies.

Some key findings include:
(1) Existing performance measurement frameworks are inadequate, and the majority of executives perceive a growing need to better understand the underlying drivers of their performance through non-financial measurements.
(2) Though companies are aware of the pitfalls of focusing exclusively on financial performance, the ability of executives to measure and monitor performance through non-financial measurements appears to be inadequate. Companies either do not have or are not sharing critical nonfinancial performance data with their boards.
(3) Despite the dissatisfaction with the quality of non-financial measurements of performance, current impediments to the broader use and greater sophistication of non-financial performance metrics include undeveloped tools, organizational skepticism relating to the value of these tools, unclear accountability for nonfinancial performance, time constraints and the concern that such metrics may convey too much information to competitors.

180 View – Every problem for someone is an opportunity for another. There are many consulting firms and software developers that are standing by to help.

The non-financial data is a key to the balanced scorecard. See our white paper
“Corporate Performance Management - It's ready - Are You?” for a discussion of balanced scorecard under Scorecarding.

Business Process Improvement

May 1, 2007 from CAmagazine and written by Michael Burns – “This month, we will lay the groundwork for a series of articles on business process improvement. A BPI project may be initiated for a number of reasons. If a new ERP system is required, you should consider it the best opportunity you will ever have to overhaul your business process….”

Warehouse Automation--What's Really Working For Pallet, Case, and Piece Pick Operations

January 2007 from the Aberdeen Group – “Warehouse Automation” is a broad term that encompasses many different individual technologies. The following is a list of the primary technologies Aberdeen has analyzed for this benchmark report:

Bar-Code Scanning
Bar-coding has been used in distribution centers for decades, and it remains the most commonly adopted form of warehouse automation today. It is reliable and relatively inexpensive. Bar-coding is typically used in a real-time environment, with data being transmitted back and forth via a Wireless Local Area Network (WLAN).”

Voice-Directed Picking
Voice-Directed Picking was widely introduced in distribution center environments in the 1990’s and now is used heavily in certain industries such as grocery distribution. It is used in areas where workers benefit from being able to use both hands to perform their work, without ever having to take their eyes off of the task at hand.

Cart-Based Picking
Cart-Based Picking is both a technology and a methodology. Cart picking excels in cluster pick operations, where several orders are picked at the same time with a single pick path through the warehouse. Keeping track of which items belong in which orders can be challenging; hence, cart-based cluster picking often involves secondary technology such as bar-code scanning, voice-directed picking, and pick-to-light systems…”

Aberdeen has broken out its Best in Class framework according to three key metrics:

• Labor cost reduction
• Percentage of on-time and complete shipments
• Pick accuracy

Very few companies were Best in Class for all three categories – meaning that there is more than ample opportunity for even those considered top performers to improve their operations…”

180 View – Many ERP systems have the basics, but don’t include features such as cart-based picking and other technologies discussed in the Aberdeen report.

Tricks of the Trade (A few ideas to improve productivity)

February 2007 from 180 Systems – Many people spend the majority of their time with a few programs that they know well enough to get the job done. They realize they could find a more efficient way to get the job done, but the effort involved seems to outweigh the benefit. So they’re stuck in a rut. This article will give you a few ideas to crawl out.

One big waster of time is searching for information. Let’s assume that it’s on your computer somewhere and you keep everything important. The 1st trick does not involve recent technology, just common sense. Organize your documents and email in folders or directories. However even if you’re diligent in filing things away, you could be looking for something that spans directories, email and different document types. There are solutions that are easy and inexpensive that will automate the search process. All you need to do is type the keyword and you can instantly see a subset of files or emails that contain the keyword. And the keyword does not need to be a tag that you manually apply. It’s just text somewhere in the document or email. There are solutions like X1, Google desktop, ISYS that can help. And Microsoft Vista (The new Windows system) now includes search right out of the box.

Meetings are also right up there as big wasters of time. Once again, you can use common sense to reduce the wasted time by making sure everyone gets to the meeting on time, establishing a tight agenda, issuing documents in advance…. But technology can help too especially if the participants are not in the same office. Try one of the web conferencing tools such as WebEx or GoToMeeting.

You can also waste time flipping back and forth between documents. Windows does let you split the screen and synchronize or de-synchronize scrolling, but you don’t see as much as you would like. The solution is relatively inexpensive by using a dual monitor or using one of your old clunkers to view a document while you do the heavy lifting on your new PC.

When creating presentations or writing documentation, you will want to copy something that appears on your computer screen. There has always been the PrintScreen function that can give you the whole screen or just the current window by also using the ALT key when you press the PrintScreen function key. But if you can’t do it because there are restrictions on the document you are reviewing, or you want to be more picky, there is help using a program such as SnagIT. (I know I don’t need to remind you to give credit to other people’s work and make sure that you are not violating copyright)

There are also many time savers in the programs we use everyday. The best way to leverage these tricks of the trade is to provide training. Why not have a series of lunch and learn sessions? Get your best technical person to show time savers in MS Word or Excel. For example, teach the group how to do multiple selects from a list using the CTRL or ALT key or to automatically populate a series of days, months, years… Take a look at Office Watch for instruction on how to use AutoFill

We are sure there are many other ways to be more efficient, and would welcome any of your suggestions. Please update the blog with your suggestions. Thanks

180 View – We wrote it so you already know our view.

The Power of Process

December 18, 2006 from Business IT Alignment News and Analysis – “As of late, the IT industry has been peddling various solutions to understand, monitor or optimize that nebulous beast called “process.” So what is a process and why should every CIO be focused first and foremost on business process?

Most of us have seen the now overused IPO diagram: the three boxes arranged in a line, and connected by arrows like the boxcars in a train. The first box contains “Inputs,” which move into the next box titled “Process,” which subsequently flows into the final box, titled “Outputs.”

This diagram is a model of simplicity, yet exposes a flaw in current thinking. Two thirds of the diagram is concerned with inputs and outputs, placing priority on “stuff” rather than how we actually change one form of “stuff” to another. While a simplification that fits neatly into the world of flowcharts, in the real world we often focus too narrowly on moving and changing “stuff” versus why we are changing inputs to outputs, and determining how to efficiently and portably change that “stuff.”

Process is the “why” to any business problem. IT has embraced process more than most other business units, at least on a superficial level. We are familiar with how to diagram a process, and nearly all of the project methodologies provide a provision for capturing, diagramming and understanding the “as-is” process, or the current state of affairs, before we seek to intervene and bring about a new state of affairs.

We also have myriad tools at our disposal for improving a process, either by increasing its speed, efficiency, accuracy or repeatability, in the form of powerful technologies from ERP systems to entire process management toolkits and software.

What we often lack however, is the ability to separate content, the inputs and outputs, from the process itself, which has hampered the ability of IT to implement successful projects that deliver the business benefit they initially sought.

IT has been built around content, both in terms of hiring and developing its staff, and in how it approaches IT projects in cooperation with a business unit. We hire and evaluate people that are experts in a particular technology, which is just another content area. We then approach a particular business problem as an issue of content. Why are our competitors more efficient? It must be due to their ERP system. Why did a new entrant to a market outfox us? They must have better decision support systems, etc.

We see a business problem as one of bolting new technology onto existing processes, wrongly assuming that by changing the content of the process, the process will change as well. This can only be expected when we have built organizations around experts in a particular area of technical content, and business experts familiar with the rules and nuances (more content) of a process, experts in the "how" rather than the "why”…

180 View – IT does typically suggest new technology as the solution unless they have a vested interest in maintaining the status quo. It would be great if IT also considered business process improvement as a way to enhance efficiency or effectiveness. But let’s not forget about human resources (how do organizations structures, job definition, and skills impact the process?), policies and rules (such as the approval process), and facilities (workplace design, infrastructure, computers…).

Creating Smarter, Faster, Cheaper Processes is IT's Main Mission

October 4, 2006 from CIO Insight – “One of the most important lessons from the last 25 years of business computing is that you can't throw technology at a problem and expect it to go away, or fling a system at an opportunity and expect the dollars to rain down. To get any real value, business processes—how people work, how work is organized, how work flows—have to be changed, too. That lesson has been absorbed, judging by the results of our first survey on business process improvement since 2003. Process improvement has emerged as the top business priority for IT organizations; improving productivity and reducing costs as the most common goal."

180 View – IT resources typically find IT solutions to business problems, and then find a creative way to prove the business case.

Business Process Improvement Survey: Creating Smarter, Faster, Cheaper Processes is IT's Main Mission

October 2006 from CIO Insight – “Improving business processes is the top priority for many IT executives, especially at small and midsize companies. Most companies are hoping to boost productivity and cut costs by revamping their business processes with the help of IT; smaller companies are also aiming to increase revenues. Not surprisingly, that's spurred an increase in the number of BPI projects across the board. Integrating timely information into work processes is also important: 83 percent of respondents say one of their primary BPI goals is to deliver critical information to employees while they are carrying out the company's business processes. But CIOs aren't just seeking to improve operations like logistics and customer service; they are also looking to improve the ways that managers and knowledge workers do their jobs, since managers as well as rank-and-file employees are under great pressure to work more efficiently and effectively. Financial, compliance and strategic planning processes head the list of today's top three BPI priorities.”

180 View – IT can help Business Process Improvement (BPI), but should not be the driver. First, IT can have its own agenda, which may not be aligned with corporate strategy. Second, BPI is achieved not just by investment in IT. Motivation, organizational structure, and business process design can also have a huge impact.

A survey of Canadian decision makers on business performance and regulatory compliance in the Finance function

July 2006 form KPMG - "KPMG's Advisory practice conducted a survey of 170 of Canada's senior executives to determine how their Finance functions have responded to the new regulatory mandates, and how successful they have been in maintaining the balance between activities supporting compliance and those supporting business performance. In an effort to focus on the views of Finance functions' key customers and stakeholders, the survey included Chief Executive Officers, Presidents, and Chief Operating Officers, but specifically excluded Chief Financial Officers themselves…

Business leaders are concerned that regulatory requirements have caused the Finance function to focus on compliance at the expense of other areas of its mandate. Three-quarters of respondents believe that corporate growth and profitability have suffered as a result of the Finance function's focus on compliance. Management reporting, budgets and forecasts, corporate finance, risk management, and strategic planning represent areas of opportunity for Finance departments to rebalance their activities and improve contribution to the business. Decision makers are prepared to make investments to rebalance the activities of their organizations' Finance function."

180 View - We think that compliance auditors should provide value related to business performance at the same time. By identifying inefficient and ineffective business processes, compliance auditors would support business performance. Inefficient business processes do the job with the least amount of resources. Re-keying or duplication should be easy to spot. However effective business processes are more difficult to identify. Effectiveness requires knowledge of CSFs (Critical Success Factors are what an organization must do well in order to be successful). If the business process does not support the CSF, then it's not effective.

It's time to stop measuring and start doing...

May 2, 2006 from Silicon.com - "Over the past few years I have been working in companies and other organizations including those in the health and education sectors where the introduction of performance metrics has had a profoundly negative effect.

In every case there has been a liberal application of simplistic thinking that has resulted in a vastly reduced overall performance with a combined increase in operational costs. How come? Very often those to blame are in political office and under pressure to show the electorate they are earning their elected position.

For sure, if you are to manage anything effectively you need measures, and if you are to improve performance you need metrics. But the first question to ask is: does it actually need managing and is there any space for improvement?

It is unfortunately a truism that most managers don't see that they are often in the way, can add no value and should just get out of the way. An awful lot of processes and activities just don't need managing in the first place. For those that do, they require a liberal application of intelligence and understanding. If you give people targets, they will achieve them; if you demand a change in performance from managers, they will show you one. In the first instance they will try and do your bidding but in the second they will resort to embellishing the truth, polishing the numbers and plain fiddling.

In the worst areas infected by the (modern) metrics disease we see irrelevant or conflicting requirements and targets, and more managers of metrics than those actually trying to achieve them.

The real killer? People stop becoming effective and turn the metrics game into a full-time career. In many countries we have police, medics and educators spending more time reporting than doing! So the supervisory overhead is very often the dominating portion of the overall spend and budget. This is a surefire route to failure in any system. Admin really ought to be less than 10 per cent and not 80 per cent of the budget.

So what is the solution - beyond good management that is? Once a set of sensible and minimal performance targets and metrics have been decided and agreed, automation is the only route to success. Just because something can be measured and recorded doesn't mean it should be!

In the worst case people will always resort to telling lies, gilding the truth and interpreting results in their favour. So most of the information created by such human systems is a travesty, waste of time, detrimental distraction and expensive hobby! In contrast, our machines will only tell it the way it is, provided the entry of data is also fully automatic.

All of this begs the question: why isn't modern management and politics up to the job? Simple! They are operating in some 18th century regime of quill pen and parchment thinking. Until we see the application of game theory, war gaming and situation modelling, combined with automated data recording, gathering and analysis, we will continue to see the waste and disruption continue to accumulate.

We have the technology but it seems we don't yet have the wisdom."

180 View - SMART (Specific, Measurable, Actionable, Relevant, and Timely) metrics should solve all the problems above.

Benchmark production planning and control processes

"This free, 20 point "ABCD checklist" allows you to benchmark your company's production planning and control processes against current best practice... The 20 point checklist does not cover every area of business performance but it is our experience that a company's score on these 20 points give a strong indication about the company's overall business performance."

180 View - We have not used this checklist ourselves or on behalf of a client, but heard good things about it in an online forum. It looks like a good tool to evaluate your business processes. Please let us know what you think.

Why Your Employees Are Losing Motivation

April 10, 2006 from Harvard Business School - "Most companies have it all wrong. They don't have to motivate their employees. They have to stop demotivating them. The great majority of employees are quite enthusiastic when they start a new job. But in about 85 percent of companies, our research finds, employees' morale sharply declines after their first six months—and continues to deteriorate for years afterward. That finding is based on surveys of about 1.2 million employees at 52 primarily Fortune 1000 companies from 2001 through 2004, conducted by Sirota Survey Intelligence (Purchase, New York).
The fault lies squarely at the feet of management—both the policies and procedures companies employ in managing their workforces and in the relationships that individual managers establish with their direct reports...

To maintain the enthusiasm employees bring to their jobs initially, management must understand the three sets of goals that the great majority of workers seek from their work—and then satisfy those goals:

• Equity: To be respected and to be treated fairly in areas such as pay, benefits, and job security. How Management Demotivates
• Achievement: To be proud of one's job, accomplishments, and employer.
• Camaraderie: To have good, productive relationships with fellow employees.

180 View - The best system with the best business practices can't compete with motivation in improving business process.

Accounting System/ERP Customer Survey

April 2006 from CAmagazine written by Michael Burns - Check out the results of our 2nd customer survey of accounting and ERP systems. See how well readers like the system they're using, and how they rate the developers and implementation partners. We also asked for some general feedback about return on investment and future plans.

Eight Tips For Creating A Vendor Short List

February 23, 2006 from Managing Automation and based in part on an interview with Michael Burns - "Your list of requirements should match up with pre-defined critical success factors (CSF) -- those things you must do well in order to be successful as a business, adds Michael Burns, president of 180 Systems Ltd., a business consultancy in Toronto. "If a requirement can't be mapped directly to a CSF, then it's not critical."...

When creating your RFP, Burns suggests asking vendors to respond not with a yes or no but with a number between one and seven. "When they say yes, that can mean anything," Burns says. You can get more specific through a numbering system, where a "6" might indicate that a feature is available in the current release of the software, a "5" that it will be available in six months, and a "1" that it would require a major modification or workaround. Combining your weighted requirements with these weighted responses will give you a way of scoring vendors to determine which makes your short list, he says.

You might be tempted to skip the reference check process, assuming you'll get only positive responses. However, according to Burns, "forty percent of the time, the reference is not a positive one," he says. "It's amazing how little vendors know about their customers." Burns offers a checklist of questions to ask each reference and advises that you tell each one a little about yourself before asking any questions so that they have a level of comfort with you.
Don't spend time on system demonstrations until you've narrowed your list to a handful of finalists. You can even take a two-pronged approach, Burns suggests, where the first demo is done over the Internet and the second one is more in-depth. In all, you should attend no more than four demonstrations, and limit each to two to three hours, he says. Ask demo attendees to identify major strengths and weaknesses, he says."

Use internal benchmarks

2006 from McKinsey Quarterly - "While a company must know what its peers are achieving, it's a mistake to measure its performance against the competition: these benchmarks are typically just samples of data with little explanation behind them. Companies that use external benchmarks are often frustrated to find themselves off by a factor of five to ten, positively or negatively.

Using external benchmarks compounds the internal difficulties that service companies face in normalizing activities and the data that define them. Consider a measure such as costs per unit of information processed: some companies include allocated costs, such as corporate overhead and salaries; others don't.

Internal benchmarks deliver more detailed metrics, allowing a company to find its own best practices and to see where and how they are achieved. It can then have access to all relevant information to assess differences among business units and accounts. In defining internal benchmarks, for example, a company can determine which costs are included or how asset costs are allocated — details that get lost in external benchmarking. A company can see what's really possible within the organization by using its own benchmarks."

180 View - The benchmarks should be metrics or key performance indicators that align to Critical Success Factors - those things that must be done well in order to be successful.