The notion of process improvement has been around for decades, along with myriad methodologies for executing business process improvement initiatives. Many of us have lived through Business Process Reengineering (BPR), Lean, Six Sigma and a host of other methodologies. While each of these methodologies has its champions, benefits and draw backs, they all really come down to just a few simple steps – steps you can follow using one of these methodologies, or your own. So, just what are the fundamental steps to executing a process improvement initiative?

Regardless of the reason you are undertaking an initiative, there is certain information you need before you can start your initiative and information you will gather during the process to move the organization toward the new direction. Below are the steps you will execute, and information and considerations you will encounter along the way.

Current Environment
The first step in executing a process improvement initiative is to understand your current environment. If you don’t understand what is currently happening, you may miss important information or issues during your improvement initiative. The best way to go about developing this understanding is to document your current processes using some sort of flow charting. While there are fancy tools available to do this, it is possible to accomplish this with just large sheets of paper and some markers.

Document each step in your process, including who is executing the step. Be sure to document what is actually happening – not what your procedures tell you to do! Creating a visual representation of a current process is often enlightening – particularly if you involve the whole group executing the function. Often times, there will be different opinions on what is happening at any step along the way and this information can highlight issues and/or opportunities which should be considered when redesigning your process.
In addition to the process steps, be sure to capture data such as automated systems supporting each process step, transactional information, durations and other metrics which also often provide insights into improvement opportunities.

Future Environment
After you understand your current environment, roll up your sleeves and have a little fun. It’s time to define what your future could look like. Taking a clean “sheet of paper”, design your business process the way you would like it to work without any of the restrictions you might currently have. Examples for restrictions might include: computer system requirements/ functionality, regulatory requirements (don’t worry – we’ll add these again later), corporate requirements and so forth. Right now, the sky is the limit – freely design your future the way you would ideally like to see it work.

As you are designing your new process, identify the key steps as they relate to your organizational strategy. Any steps which are not directly contributing to the execution of your strategy should be considered for elimination. So, as you are evaluating each step in your process, clarify why it’s important to your organization. If you can’t define a reason for the step, it’s destined for the chopping block.

Once you have agreement about how the future should look, apply any restrictions you might have which cannot be negotiated. It is important that you question any restrictions you add back to ensure they are truly restrictions, and not some imposition based on culture or past history. After these requirements have been applied to your process, you are ready for the next step.

Gap Analysis
A gap analysis is a critical step in any process improvement initiative. Performing a gap analysis not only identifies the deficiencies between your current process and your future process, it also highlights the magnitude and scope of the change required in order to bring about your new future. This information is critical for planning your change management tasks to bring about the desired change. In addition, it allows you to 1) determine whether a phased implementation of the change is appropriate, 2) prioritize implementation tasks, and 3) develop a realistic budget for the improvement initiative.

After completing your gap analysis, you may determine that the future vision is a little too aggressive or expensive, necessitating changes to the design of the future environment. Go ahead and modify your vision based on your learning and tolerance for change. Modify any process documentation and don’t forget to communicate the changes and adjust the expectations of your stakeholders.

Define Metrics
Now that you have a well defined future vision of your business process, it’s time to define some metrics for measuring the performance of the process. Remember, in the first step we gathered information about process steps including transactional information, durations and such. Now it’s time to evaluate those measures to determine whether they still make sense for the new process design, or if it’s time for some fresh measures. The measurements really only depend on what is important to you to determine whether you are fulfilling your part of the corporate strategy. Consider what the target measures should be for each metric, so you can measure against your expectations for the process.

Remember also that measurements don’t have to be fancy – the calculations or data collection for the measures does not have to be complicated in order for the metric to make sense. Simple, but meaningful, metrics which quickly give you the information you need to manage are all that are necessary. While it might be fun to have a fancy dashboard of graphs and gauges, if this information is not helpful to you in making management decisions, then they are not fulfilling their purpose. Keep it simple.

Implement, Execute and Assess
You’ve created your vision of the future, and defined your measurement system – now it’s time to implement. While the topic of change management is a topic worthy of a separate article, suffice it to say that it is a critical component of your implementation success. Make your plans, and implement your changes. Execute your new process, and measure your performance with your newly defined metrics.

Assess your results to determine whether or not you are meeting your expectations for the process. If not, evaluate your results to determine whether your expectations were a little grandiose, or if there are unanticipated or unexpected impacts to your newly define process. Refine your process steps, as necessary, to accommodate these unanticipated impacts, and modify your metrics too, if needed. Continue to modify and refine both the process and metrics over time to ensure the process is delivering the business value expected of it.

Following these basic steps, regardless of the process improvement methodology you choose, will take you a long way toward improving how you deliver your products and services to both your internal and external customers.

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