Process Improvement Archives - Page 2 of 3

Engaged Employees = 27% Higher Profit!

February 22, 2015/in Human Resources, Process Improvement /by Greg Mitchell

Engaged employees = 27% higher profit, 50% higher sales and 50% higher customer loyalty. (Gallup Study)

Is Your Business Set to Achieve Success Through People? Our FREE diagnostic tool will help you find out!

Consider for a moment the total value of your investment in the employees within your business -basic wage and salary costs, leave provisions, workers’ compensation and other insurances, training costs, incidental costs, accommodation and technology costs, recruitment and induction costs, the cost of casual staff to relieve employees on leave etc…. Think also about the time involved in recruiting employees and having them perform at their best, the time you might need to invest in addressing poor performance, conflict, customer complaints etc….

If yours is like most businesses, you’ll find that the total investment in your employees is significant, and in many cases it’s the single-most significant cost of doing business. With this in mind, it simply makes sense to ensure that your business is managing employees in a manner which generates the maximum possible return on investment. Read more →

Going Green Can Put You In The Black

September 3, 2013/in Process Improvement /by Wayne Moloney

Going green’ may sound a little gimmicky but it has some real benefits for SME businesses. Operating a green business is not only good for the environment but good for your business’ bottom line because conserving resources and cutting down on waste ultimately means money savings for the business. For the imaginative entrepreneur the move to thinking green also opens up a wide vista of opportunity in developing and marketing green products.

Growing concern about environmental issues has opened up a wide variety of new markets related to producing and selling green products that answer to an increasing desire by consumers to be ecologically friendly.

Established in 1995, Roots Biopack Limited produces eco-friendly biodegradable food containers and packaging products using agricultural by-products, such as sugarcane fibre and empty fruit receptacles. In their factory the boiler’s waste heat is used to heat up water for office and staff housing. Roots’ clientele has grown to include many leading international fast food restaurants and supermarket chains.

Fried chicken and the environment might not seem to have much in common but FiltaFry developed a micro-filtration process that significantly extends the life of cooking oil, which means much less waste is generated. FiltaFry will come to a restaurant, hospital or hotel and clean the cooking oil on location. And not only does the oil last longer, but it’s also cleaner, which means the food is healthier too.

Saving Production Cost
Even companies whose line of work is more traditional can benefit from using green practices.
TerraCycle produces an organic plant food made from worm castings but what is different about their product is the packaging – used plastic soft drink bottles. Not soft drink bottles that have been melted down and remade into a different form, but the actual used bottles themselves. The company has repurposed over a million such bottles, which has meant savings in production costs as well as a lot of good publicity.
Thomas Mott Bed & Breakfast phased in energy efficient practices over a number of years to reduce its electricity bill from its pre-program level of $11265 to a post-program one of $1649. How? The owners of the old farmhouse-turned-B&B invested in wall space insulation, windows designed to minimise heat loss, a state-of-the-art boiler, highly efficient compact fluorescent lamps, switched the kitchen from electric to gas and planted trees to provide shade and lower cooling costs in summer.

Common Sense Savings
While any one small business may produce few direct greenhouse gas emissions, their collective use of energy in the form of electricity to heat and cool and drive equipment, of oil and other chemicals and of fuel to transport raw materials, distribute product and remove waste all add up to a significant contribution to total emissions. By optimising energy use most small businesses achieve significant savings on their utility bills as well as reducing their carbon footprint.
Most of the savings that green businesses make result from nothing more than common sense thinking. Laptops use less power than desktop models; motion detectors in bathrooms, timers on water heaters and coffee pots, and programmable thermostats throughout the premises all cut back on using electricity when people aren’t using the facility; replacing equipment that performs inefficiently, such as printers, refrigerators and air conditioners with new, energy efficient models reduces energy use and utility bills; moving to email to deliver mail and accounts reduces paper use. Look at your business carefully and there is likely a lot of low-hanging fruit to be picked when it comes to saving energy. Added up, these will amount to significant savings.

Coming Ready or Not
In industrialised countries small businesses consume from 50-55% of the oil and natural gas resources, and so are responsible for a significant amount of greenhouse gas emission. It’s only a matter of time before the impact of global warming results in mandatory limits and penalties for non-compliance and these will be applied to SMEs no less than to large companies. Yet while SME surveys regularly find that increasing energy prices rate as a top concern, only a minority report actually spending money to increase energy efficiency. That’s a disconnect that needs to be addressed. Since one of the quickest ways to cut greenhouse gasses is for businesses to become more energy efficient it seems that the most sensible solution for SMEs is to kill the two birds (greenhouse gasses and energy bills) with the one stone – introducing more energy efficient production methods. SOURCE NOTE: RAN One

Good Inventory Management

May 14, 2013/in Process Improvement /by Wayne Moloney

It Will Improve your bottom line!!

Inventory management means keeping track of the goods you buy, process, or store as part of your business. The cost of buying and holding inventory can be very high. It can account for up to 80 percent of the final price of goods or services in some industries. Good inventory management involves minimising inventory costs.

It will also help you determine where you are working profitably and where you are making a loss. Keep a poor track of inventory and you may be making a loss in some areas of operation without even knowing it.

Inventory management involves more than just record keeping. It affects
the operational structure of your business.

What Is Inventory?

All the resources that you hold for future use or sale are classed as
inventory. This includes:

Raw materials – anything that you will convert into a product or a tangible part of a service.
Supplies – goods that support the production process such as office stationery or fuel to power machines.
Partially transformed goods – your work-in-progress inventory.
Work-in-progress inventory that you set aside as a buffer to work on in case of delays in production or supply.
Finished goods, ready to be delivered or sold.

How Much Inventory Do You Need To Hold?

Your costs increase when you hold too much or too little inventory. If you have too much inventory you are paying money to store it for no good reason. If you have too little you risk delays in production or service delivery. Good inventory management means having the right amount of inventory, in the right place, at the right time.

Many businesses like to hold more inventory than they need for immediate use or sale. This is because reserve inventory can:

Cover for unexpected quality problems in the production process.
Smooth over unexpected production delays (such as supply problems caused by transport strikes, supplier bankruptcy, general supply scarcity or plant breakdown).
Minimise downtime caused by such disruptions.
Provide the capacity to respond quickly to unexpected demand increases.
Generally improve the reliability of the production process.
Take advantage of bulk purchase discounts.

But there is a downside to holding inventory:

The cost of storage.
The risk of inventory theft or decay.
The loss of value of inventory items (through obsolescence, for example).
The administrative costs of ordering, transporting, handling and keeping track of inventory.

Deciding how much inventory to hold is partly a matter of weighing up costs and benefits. It means analysing when and where you will have a crucial need for inventory. To carry out this analysis you need to take a close look at your business processes and identify internal and external demands for inventory. You could do this yourself, but it is advisable you run your conclusions by your business advisor or accountant for feedback.

Consider Internal And External Demands

Mapping out your business processes will help you understand your internal demands. If you are a manufacturer, your process map will show you when and where you need materials.

Internal demands can be quite complex, even for a small operation, as you may need to keep track of a large number of supplies and components. Mistakes can be costly. Say production is higher than usual for the month – production may be held up if someone has forgotten to cover for higher production by ordering more of one critical component (paint, for example). Your inventory management systems should
prevent such mistakes from occurring.

Inventory management also requires you to keep in touch with market demand. You need to stay in touch with larger economic or market trends. But you also need to keep a close eye on how products are being sold. If you are a retailer with several outlets, for example, you might find certain products sell better in certain areas.

Keeping a close eye on sales will help you decide how much to ship, so that shelves are neither overstocked nor empty. This can be particularly important if you are selling perishable goods or goods that follow seasonal demand (such as fashion).

Consider Your Operational Structure

Your inventory management systems need to fit in with the kind of operation you run and the way you respond to customer demand.

Resource to order

If you are running a ‘resource to order’ operation, it means that you stock resources in response to individual customer orders. If you are a caterer, for example, you will buy stock for particular events. Or if you run an engineering company, you may stock up for particular construction projects.

You deliver a highly customised product to your clients and this flexibility is likely to be seen in all parts of your operation. You are likely to have a multi-skilled workforce that is highly sensitive to customer demands. Your inventory needs will vary according to the job or project you are working on.

Make to order

If you are running a ‘make to order’ operation, you keep a standard inventory but produce a customised product. For example, you might run a small sandwich shop. You keep a range of ingredients and make the sandwiches according to individual customer orders.

Or you might run a small computer retail operation and use standard components to build a computer to customer requirements. One customer might require a large monitor, for example, or a particularly fast processor. Though your inventory is standard, you are still running a flexible operation and you will expect your team members to take initiative, show a range of skills, and fill in for each other on occasion.

You will not produce goods in any predetermined sequence and your component needs will vary according to each customer’s wishes. You will need to stock inventory to meet a range of possible needs.

Make to stock

‘Make to stock’ operations tend to produce a high volume of standardised products. For example, if you run a sandwich shop that makes and sells pre-packaged sandwiches, you are making to stock. Or if you are
a manufacturer who produces a line of standard alarm clocks, you are making to stock.

Your inventory needs will be simpler, in one respect, as you will need components and supplies in standard and predictable proportions. You will not be able to customise to attract individual consumers. But you
will produce high volumes of a standard product, giving you access to economies of scale.

This type of operation traditionally requires a less skilled workforce, though modern approaches such as lean manufacturing are changing this.

When you consider your inventory management, think about the sort of operation you run. It will affect how closely you need to monitor your inventory, how often you need to monitor stock levels, and how predictable your inventory demands are likely to be.

Focus on Inventory

There are many other aspects to inventory management such as monitoring inventory; inventory management software for manufacturers; Just-In-Time goods delivery techniques; retail trade inventory; addressing excess inventory problems; tagging methods. InForm Consulting Group can give you more detailed information and guidance about these important considerations. Inventory management is a key part of your business. It does not matter whether you are running a small or medium-sized company or whether you are delivering goods or services. Inventory management can make the difference between
running in the red, or in the black.

Is LEAN Business simple common sense? How to grow sales and profits – at the same time

April 1, 2013/in Process Improvement /by Mike Karle

Tuesday, 27 April 2010 16:58 | Written by Mike Karle

The answer is a resounding YES but the key to success is the HOW…. the HOW to implement, the HOWHOW to communicate and the sustain improvements for the long term.

Let’s start with your business culture…..

I see the culture of an organisation as the key to success of applying LEAN principles throughout a business or organisation, especially to gain long term benefits in growth and profitability. What do I mean by culture? Simply put, the culture reflects the values of the organisation and in most cases the culture reflects the history and the values of the leaders. Or it is simply “how we d things around here…”

If “how we do things around here…..” means:

We share ideas and no one has a silly idea
We have open communication on a regular basis
We are always looking for ways to improve our product or service to our customers
We are always looking for ways to be more efficient

then you have a solid foundation to implement LEAN Business principles and get the long term benefits growing sales and reducing costs.

Where to start…..

LEAN focuses on the Voice of the Customer (define the product/service attributes and features) and delivering what the customer is prepared to pay for at the lowest cost. So, the focus is on customer service and reducing unnecessary costs in the business.

When you start to really get serious and detailed about the Voice of the Customer (VOC) you will very quickly start asking questions like “Why do we do things that way?” You will start looking for ways to be more efficient and deliver what your customer needs. To get real solid data on the Voice of the Customer consider surveys, interviews, focus groups and reliable consumer research. The best method will depend very much upon the number of customers you have, whether they are consumers or whether you are more “business to business”. What is vital is to get the whole picture quantified, not just, Quality, Cost and Delivery but other factors such as:

Packaging and labelling
Invoicing and payment terms
Flexibility in service
Technical support and after sales support

Having a clearly defined and quantified the VOC then the next step is to measure your current product and/or service offering against the data from the survey. This will do two things for you:

Identify where you are not meeting your customers needs – allowing you to do something about it!!!
Allows you to identify what your customer is not prepared to pay for, that is, the non-value add activities. These can be considered a waste and need to be minimised.

This is a starting point for the implementation of LEAN Business, one which will give you a clear focus on what is valued by your customer. You will find that all your staff will be able to contribute positively to this approach so long as the “way we do things around here” matches the four points above.
Look out for more installations of LEAN Business in the near future…..Dave Burgess

What is Innovation?

March 5, 2013/in Process Improvement /by Wayne Moloney

We hear a lot these days about “innovation” and the need to be innovative to be competitive. But what is innovation?

Innovation is much more than just having a good idea, because ideas in isolation are of little or no value.

My colleague, Michael du Plessis defines innovation as the “Practical Implementation of New Ideas”

Sure, innovation has to start with an idea, and these ideas can come from anywhere. Generate new ideas by scouring the world, watching the market and your competition, have brainstorming sessions in house, asking your customers, but make sure you nurture “germs” of ideas from anywhere or anyone.

But an idea without action is still just an thought. It may provide inspiration, but you must do something to make that idea valuable, you must take action!! Only practical implementation of your idea will deliver results, so have a go.

And innovation is not just the domain of the business owner, managers or R&D. It is everyone’s responsibility. Everyone in your organisation can be innovative, so create a business culture that supports and encourages innovation – thinking outside the box. Support your creativity in your people. And make sure their creativity is be acted on and provide feedback on the success or otherwise of the innovative idea. Always encourage going that extra step to act on their ideas.

And innovation must take the customers point of view – this is something that is often lost in the enthusiasm of getting new ideas into practice. If the innovation is not of value to the customer or simplify the way you do business, maybe it’s not as innovative as you thought.

Innovation shouldn’t be something that needs special attention, it should become part of the way you do business – continually asking “what could I do to improve the customer experience? What could I do to simply this process? What could I do different to increase sales?

Research shows that innovation is a powerful driver for achieving better business results.
Innovation is linked to:- increased market share- high rates of growth- more profits

And when you implement a new idea, how do you know it is helping develop your business? MEASUREMENT!

Measure everything:- number of leads- value of each order- revenue- profit- time to deliver etc, etc, etc.

Innovation is critical to the ongoing success of any business, because if you are not making changes, your competition no doubt are, and you can bet the person making the changes that are most appreciated by the market will come out on top.

It’s all part of the Practical Implementation of Good Ideas!

Lean Business starts with the Voice of the Customer (VOC)

March 1, 2013/in Process Improvement /by Mike Karle

The implementation of a Lean Philosophy in any business is a continuous 5-stage process that begins with the identification of the value desired by the customers. Unfortunately, this old marketing concept is frequently forgotten during Lean implementation as suppliers and service providers regularly introduce new products and services that are constrained by their own internal demands and their existing facilities and paradigms, rather than by actual customer requirements.

“…I know exactly what our customers want.
We have been in this business for many years and they only want three things… price, quality and delivery – in that order!”

Far too often companies, whether manufacturing or service orientated, work on the assumption that they know exactly what their customer needs, or they give their customers what happens to be convenient to them, e.g. automated telephone answering systems that reduce costs to the provider but infuriate customers, or goods packaged in containers and in quantities that suit the manufacturer, but not the customer. While many companies often know who the key decision makers are in the customer organisation, few actually understand the individual value criteria that influence their buying decision making. True customer satisfaction is achieved only when suppliers meet or exceed the customer’s expectation against a range of customer-specified value criteria.

While customers do want price, quality and delivery (PQD), there are a host of other factors that can influence buying decisions, e.g. packaging & labeling, invoicing, design flexibility, communication (including methods, speed, style, documentation etc), quotations, after sales service, environmental issues, lead time reliability, technical support, safe handling, product/packaging disposal, and payment terms. By conducting a detailed customer needs analysis with the relevant decision makers, i.e. those people that come into contact with the product or service and are able to influence buying behaviour, many companies are surprised to find that the actual customer needs are quite different to their perception of these needs as is depicted below.

Customer Value – Actual vs Perceived

Determining the actual customer-specified values depends on the number of customers and relationship that the company or service provider has with these customers, i.e.

a) Direct relationship with relatively few customers, as is the case with a typical manufacturing company that supplies other manufacturers or the wholesale trade.

b) Indirect relationship with many customers, as is the case where goods are sold to the mass market via retail outlets.

The first case lends itself to conducting direct interviews with the various decision makers within the customer organisation, asking them to identify their personal value criteria and then ranking your performance relative to your competitors or the ‘best in class’. Where the decision maker has identified numerous needs or values, these should then be ranked in order of importance.

In the second case where there is only an indirect relationship with the customers, market surveys, focus groups, warranty repair data and customer feedback forms typically become the data source for determining customer value criteria.

Any customer needs analysis should be conducted with a representative group of existing customers (high, medium and low volume), and should also include potential customers. Be sure to include the following two aspects of product or service delivery, i.e.

* Pre-Ordering: Listening to the customer to understanding what is important to them before they place an order.
* Post-Delivery: Determining the actual level of service achieved relative to customer expectations.

Having collected the data, collate and plot the results to determine the most important value criteria, and then establish action plans to address shortcomings within your organisation.

Only after having listened to the voice of the customer to understand the true value of the product or service from the customer’s point of view, can the supplier continue down the path of Lean and identify those internal processes that contribute, or add value to that product or service, i.e. stage 2 – identifying the value stream for each product or service group. This is the sequence of all current processes, both value adding and non-value adding from raw material to product launch or from initial customer contact to service completion. In doing so, the non-value adding processes will automatically be identified which allows the supplier to progress to stages 3 and 4 in the Lean implementation, and use the various Lean tools and techniques to reduce and ultimately eliminate the non-value adding processes.

Having completed an initial cycle of the Lean implementation, the process constantly repeats itself in a never-ending quest for perfection.

For further information, contact Mike Karle ( mike.karle@informgroup.com.au)

Lean Manufacturing and your Carbon Footprint

January 31, 2013/in Process Improvement /by Mike Karle

A number of Victorian companies reported recently that “they are on track to reducing their carbon footprint by 30% throught the efficent use of energy.” This report is fantastic news and music to my ears.

The company spokesman described their actions as a “win-win” – they reduce emissions and save money at the same time. Simple and effective.

So how does Lean Manufacturing principles and your Carbon Footprint relate to each other?

Lean Manufacturing principles are all about eliminating WASTE in your business. Waste whether it is transport from one factory to another, inventory of finished goods, product rejects, electric lights being left on or simply duplication of electonic copies with paper copies.

All waste consumes energy, energy has a CO2 equivalent rating and contributes to your carbon footprint. Those companies in Victoria are applying LEAN THINKING to their business. They are analysing where they can be more efficent and use less for the same level of production.

Lean Potato Chips?

A great example of Lean Manufacturing and energy consumption is how a Potato Chip manufacturer in the UK reduced their consumption of gas significantly. Their main supplier, Potatos Farmers, were paid on the weight of their spuds so to ensure that the best price was achieved the farmer kept his produce hydrated during transport to the chip factory. The chip makers in turn had to use more gas to drive the moisture off the sliced spuds, thus using more energy. Using Lean Manufacturing methods the chip maker identified this grower practice as a non-value add activity resulting in a significant waste of gas.

Solution? Change the purchase contracts to be based on weight and moisture content – result – the growers use less water, the manufacturer uses less gas and less energy is consumed. Winners all round.

Lean Manufacturing eliminates waste, focussed on the what the customer is prepared to pay for and the end result is less energy use. This is good business practice that should be simply the way we do business.

20 Questions to Help You Improve Business Processes

December 18, 2012/in Process Improvement /by Mike Karle

Lean is a philosophy to continuously identify and eliminate waste within an organisation, where waste is defined as any activity that does not, from the customer’s perspective, add value. Fundamentally the Lean Philosophy is about continuous process improvement to create a business that optimally responds to customer demand.

While all business managers will recognise that the above statement is somewhat obvious, the real question is how does one actually go about improving processes?

Firstly, what are business processes? Business processes are ‘how we do things’, including, for example processing sales orders, drafting customer quotes or proposals, credit checking, generating a production schedule, placing purchase orders, generating invoices, creating reports, machining a component and assembling a product. Within any such process, there will always be an element of waste, where

“Waste is all Non-Value Added Effort, i.e. any activity that the Customer is not prepared to pay for…….but often has to!”

In order to improve any operational process and provide greater customer value, the process first needs to be understood, and the easiest way to understand a process is by drawing or mapping it. Mapping aims to create an end-to-end “picture” of the process…..A picture is worth a thousand words. Creating a visual picture of the process allows one to determine where customer value is being added, and then, by using the 20 Questions, identify the non-value added activities that may be reduced or eliminated to improve the process.

While there are many types of maps and charts, the simplest to use is Process Flow Chart that depicts the flow and interaction between tasks or operations, e.g. the customer order process at a local distribution company is shown below.

Once the process has been mapped and understood, areas of waste can usually be identified by asking one or more of the following 20 Questions, i.e.

20 Questions for Process Improvement

Why are goods/documents being stored here?
Why are the goods/documents etc being stored for such a long time?
Why is this task necessary and why is it being done by this person/department?
Can we re-arrange the physical layout of the department/office/factory/shop/surgery etc, to reduce the amount of movement and facilitate the flow of goods/information?
Can we eliminate, simplify or combine this task with another?
Is this task actually adding customer value or is it something “we have always done”?
Why does this task take so long?
What rules govern the process and completion status, and why?
Can we group these people/departments/tasks together?
Are we giving the customer what he really wants or only what is available, or perhaps even worse, what we have always provided?
Is this report necessary, understood, and what is it used for?
What metrics will allow us to improve the process or customer value?
Why do these tasks result in scrap components or process errors?
How can we reduce or eliminate variation, scrap rate or processing errors?
Are we manually entering the same data in different systems and can we eliminate duplicated information by improved IT systems?
Can we use new technology to improve the process or provide greater customer value?
How can we improve the customer’s experience by reducing the time from order to delivery?
When pressed for time, what steps in the process are skipped or worked around?
Are we using accounting systems that require excessive time to produce management reports which may then result in poor decision making using ‘out-of-date’ information?
Are costs being allocated in a manner that adds value to the decision making process?

The classic Deming PDCA improvement cycle is often used as powerful tool in conjunction with the 20 Questions to ensure all improvements are carried out in accordance with a well organised and defined methodology.

In Deming’s cycle, the Plan is not just about planning, but also includes communicating and gaining consensus. Far too often companies neglect this phase and fail to properly identify constraints and/or ‘root causes’ of problems. Do is the easy stage where the actual implementation is carried out, and this must be followed by the all-important Check phase. The Check is actually a learning phase where the prevailing question should be “is the change sustainable and did it work as we predicted, and if not, what can we learn for next time?” The final phase is the Act, where the emphasis is to standardise and communicate the improvement, prevent recurrence and to prepare for the next round of the cycle.

The PDCA sounds simple but it is often glossed over as many organisations concentrate on the ‘do’ and neglect the P-C-A, or alternatively adopt Murphy’s corollary to Deming’s PDCA cycle, i.e. “Please Don’t Change Anything”.

Process improvement is the essence of Lean, for without improvement, organisations will fail. Using the 20 Questions can assist in process improvement and guide an organisation along a path of continuous improvement.

Growth Requires Change

December 4, 2012/in Human Resources, Process Improvement /by Wayne Moloney

Businesses need to change if they want to grow. Change can be proactive or reactive, but without it everything stays the same and growth is impossible.

Many organizations have found to their detriment that it’s unwise to fail to anticipate changes in the external environment and suffer the consequences. Change has to be carefully planned and implemented with strict controls on both its extent and the pace at which it takes place.

First let’s look at changes that can happen to a business. These might take place over an extended period of time, often so slowly that management is unaware of the extent of the changes until it has been confronted with the unpleasant financial results.

Team morale decreases and productivity declines
Customers depart and sales decrease
Costs rise and profitability suffers

Each of these change paths can happen gradually and unless management regularly monitors key business metrics and ratios they can cause an unpleasant awakening to reality. Isn’t it much better to plan positive changes to an organization and benefit from the outcomes?

Think instead of your business experiencing these kinds of change:

Team morale is improved by a program that creates greater job satisfaction and productivity increases
A customer relationship management system generates increased turnover and word-of-mouth brings in new customers
Active management of costs and better purchasing policies reduce expenses and improve profitability

Plan and implement positive change

Where the first set of changes happened to a business and would be detrimental to growth, the second set of changes are the kind that are planned and create growth. Planning and implanting positive change is an essential element of management.

Yet change for its own sake can be a mistake. It’s important that when considering making changes to an organization the effects are fully identified and carefully analysed.

Discuss the proposed changes with two important groups of stakeholders – your customers and team members. The first group has to accept the changes or your sales will decrease; the second group has to accept them or they won’t happen in the manner you intend.

Betty Krecji of the Purdue University Department of Consumer and Family Sciences says that how one views change is dependent on many things:

The number of changes occurring at once – individuals can only handle so much change. The greater the number of changes occurring simultaneously, the more likely it is that they will be viewed negatively.

The pace at which change is occurring – the faster the changes come, the more difficulty we have in adjusting to them and the more likely we are to view change as loss.
The amount of control in times of change – the greater the involvement individuals have in making change, the greater their sense of control. The greater the sense of control, the more likely the change will be viewed as an opportunity.

Remember the human element

Communicate the planned changes internally before they happen. Change should never take place suddenly or unexpectedly; to do it this way is to invite rejection. All team members need to know what’s going to happen and why it’s a good idea.

Business owners often ignore the human element of change because they believe it can be created through giving orders. Positive and lasting organizational change isn’t like that; it’s ‘owned’ by the team and they get behind it to make it happen.

Don’t expect change to go as quickly or as smoothly as you’ve planned. No matter how much planning has gone into the process there will always be unforeseen forces that impact the success of the change effort.

Harvard Business School’s Todd Jick conducted a study that identified these problems that were experienced by a majority of firms implementing change:

change took more time than allocated
unforeseen problems surfaced
coordination of implementation activities was ineffective
competing crises distracted attention
insufficient capabilities and skills of those involved in the implementation
inadequate training was given
uncontrollable external factors had a major adverse impact (eg. Competitive, government, economic)
inadequate support for change
failure to define expectations and goals clearly
failure to involve all those who will be affected by change

Change for the right reasons and done the right way can be a powerful growth stimulant for any organization. Done badly, change can become a business disaster. Consider change carefully, analyse it as critically as possible, and implement it only after you’ve gained the support of stakeholders.

Brainstorming Your Way To Innovation

November 6, 2012/in Process Improvement /by Wayne Moloney

Marketing wisdom has it that to develop products with good sales potential you need to first appreciate your customer’s needs and then build a product that answers those needs. Customer needs analysis is the process of unearthing information about just what it is customers would really value in a product. The activities most commonly associated with this process are running customer surveys or focus groups and undertaking market research.

One group that sometimes gets left out of the loop is the company’s employees yet these people, particularly those facing customers, aggregate a huge amount of knowledge about what customers think of a product and about how customers actually use them. A brainstorming session with employees can be a very profitable source of ideas for product innovations that will answer to real needs customers have discussed with them.

Trouble is, traditional brainstorming sessions based on throwing up any and all suggestions for consideration often create more hot air than good ideas. In the real world of business not all ideas are good ideas. One reason is that many blue sky ideas are simply not feasible given the practical constraints imposed by the business’ capabilities. A brainstorming session that ends up with several hundred ideas on the butchers paper may be considered successful in terms of quantity but there’s no guarantee of any quality. Searching through this grab bag of ideas, how can you determine which of them really do address an unmet customer need?

A lot more useful ideas are likely to come up if the thinking is focused in some way so as to keep it within the zone of what customers need. One way to create this sort of focus is to work to a set of preplanned questions that work off your employee’s knowledge of actual customer needs (or behaviour) rather than to ask for off-the-top-of-the-head thoughts. A set of good questions will restrain thinking to sensible product modifications, or even new versions of a product, that could represent valuable innovations.

Business Roadmap have experienced facilitators who have helped many organisations run effective workshops – give us a call to see how we can help you.

There’s no such thing as THE list of right questions to ask and you’ll want to develop your own related to your individual business, its capabilities and its area of operations. However, some generic examples will give you an idea of how this approach works and provide a start for your next brainstorming session.

What modifications have customers asked us about? Customers will often discuss the features of a product that would be just right for them. If it would be just right for a group of customers, then it could be worth developing.

Are some customers using our product in a way or for a purpose we never expected or intended them to? For example, iPods are being used as flight data recorders in light aircraft.

Do any customers invest significantly in modifying your product to get it to do just what they want it to? The most zealous windsurfers who get new boards first and modify them, the most advanced builders experimenting with new materials like stressed-skin panels often suggest or even create useful innovations that manufacturers subsequently adopt.

What minor modifications do customers regularly make to the product? Do left-handers have to modify it to suit their handedness?

Is there one modification that would open this product up to a new customer segment such as providing instructions in another language or in braille or developing a ‘green’ version?

Do customers report a consistent difficulty with using a product? Employees are often well situated to hear about, or even anticipate, customer problems with a product.

Using known unmet needs to guide brainstorming removes the unrestrained speculation that leads to impractical suggestions to meet unproven customer needs. Rather, it allows for creative suggestions on how to devise valued solutions that meet real needs. This approach can be a powerful way of coming up with new ideas ranging from minor product modifications to an entirely new product.

At Business Roadmap, we have many years experience in facilitating practical and productive workshops to unlock ideas of management, employees and customers. To find out how we can help you unlock the innovation within your business, give us a call.