Process’ Impact on the Productivity Conundrum
Too often, the word “productivity” conjures images of Fordism or efficient manufacturing floors. Efficiency (often measured as throughput) is certainly one facet of productivity, but the focus on creating or moving more widgets in a shorter amount of time has meant that organizations have spent decades focusing only on half of the productivity equation.
In general efficiency measures if you are doing things right. Effectiveness concerns itself with whether you are doing the right things. The inclusion of effectiveness (or efficacy) in the definition of productivity is important because it reinforces the idea of alignment with an organization’s goals and strategy as a core piece of the productivity puzzle.
Dangers of Efficiency Myopia
It makes sense that many organizations equate productivity with efficiency, which captures the throughput of an individual or process. However, efficiency on its own does not guarantee productivity. In fact, an overemphasis on efficiency can lead to unintentional and undesirable consequences that hamper productivity like:
- Brittle processes — the focus on efficiency can easily result in over-Leaned process. For example, supply chain processes were leaned so thinly in the name of efficiency that they were fragile in the face of disruption and many crumbled as a result.
- Emphasis on incremental improvements — a biased view of what “better” looks like. Rather than thinking holistically about why things are done a certain way, organizations tend to focus on doing the same things a little bit better.
- Technology as a silver-bullet — when productivity problems are viewed as efficiency problems, there is a bias for quick solutions like automation. This inevitably leads to a reliance on technology as a panacea rather than addressing the root causes of issues in the process.
- Measuring what’s easy instead of what matters — efficiency measures are tangible and consequently easier to measure (e.g., costs or cycle times). Additionally, efficacy measures—such as value creation and quality—are much harder to measures, ultimately creating a vicious cycle that reinforces the focus on efficiency.
The growth of knowledge workers, who now number more than one billion, make the focus on efficiency even more dire. This includes programmers, engineers, designers, consultants, marketers, and numerous other “white collar” workers who use judgement and critical thinking skills in their work. Productivity norms developed in a manual task-oriented mindset often do not straightforwardly apply to these employees and at best, result in vague and subjective measures of the labor they perform.
To further understand the issues around productivity, APQC carried out a survey on personal productivity, its management, productivity drains, and solutions for knowledge workers.
APQC also asked survey respondents to identify the average amount of time they spend each week on process-specific productivity challenges.
- Recreating processes for how work get accomplished — when processes aren’t documented, or accessible employees must rethink and recreate processes when they must execute them. Not only does this lead to rampant variations, on average, this consumes 2 hours a week, per person.
- Creating or using workarounds for broken systems or processes — when organizations aren’t dedicated to process improvement, employees waste time creating workarounds. This often takes up more time over the long term than it would have taken to address the problems in the first place. On average, creating these workarounds takes 2 hours per week, per person.
- Performing Busy work -- this means spending time on work that has no real purpose, which means not focusing on what adds value. On average, busy work takes up 2 hours per week, per person.
In summary, poor process management has a direct impact of 6 hours or 15% of wasted time per worker per week. Which adds up over time to 24 hours (3 days) per month, 312 hours (39 days) per year –per person.
Process Related Solutions
However, given that bad process creates many hours of wasted time, it would also go to figure that process could also provide solutions. There are three consistent ways that process teams can make a difference for productivity.
Process standardization is the practice of establishing a set of consistent, clearly defined, and effective processes. Processes can include business unit or regional variations. But leading organizations address this complexity by standardizing the process at a high level while pushing process variations or region-specific requirements down into desktop procedures.
Process standardization benefits organizations in numerous ways:
- Process documentation is a prerequisite for standardization and ensures process does not only live employees’ head.
- Good standardization and documentation practices include capturing process knowledge, which ensures the continuity of business processes when someone leaves the organization.
- Standardization reduces the amount of variance in a process, which creates clarity around how to execute work.
- Standardization reduces the ad hoc nature of processes as inefficiencies are eliminated in the transition to the future state process.
Document Major Processes
Process documentation refers to the codification of processes into a visual or tangible format. The format of process documentation often varies between organizations. Regardless of what form the documentation takes, it’s important to take the execution of major processes (often end-to-end processes like order-to-cash) and put them down on proverbial paper.
Given that documentation is typically the first step in process work, it makes sense that documentation is the norm for many organizations. Documentation has multiple benefits:
- Outlines all the steps in the process and puts them in order, which creates clarity on what needs to be done.
- Includes the inputs and outputs of the process and outlines clear hand-offs between roles or departments, which clarifies roles/responsibilities for the process.
- Can uncover missing steps, redundancies, unnecessary loops, and complexity as a starting point for improvements.
Simplify or Streamline Major Processes
Nearly half of the survey respondents said that simplifying or streamlining major processes would significantly improve their productivity. There are several reasons that processes can be considered too complex—they may drill down to an unnecessarily depth of detail, include far too many business rules, or include high levels of variation to capture every permutation of the process.
The more complex a process gets; the more things can go wrong. In the face of overly complex processes, it’s tempting for employees to find workarounds or create ad-hoc processes, which consume time. Complex processes also make performance management more difficult, which in turn can lead organizations to rely on the simplicity of efficiency measures to manage their productivity.
Simplifying a process requires standardizing the process at a high-level and moving complexities (such as variations) further down into desktop procedures and business rules. This also creates a standard process that can be replicated by anyone across the enterprise without ad-hoc steps or workarounds.
Productivity encompasses much more than efficiency alone. The best organizations also account for factors like quality and effectiveness. Leading organizations also take a holistic approach to process improvement by documenting their processes, simplifying, and standardizing them so that employees can focus on engaging work that drives value.
Building on more than 10 years of business research and consulting experience, Holly Lyke-Ho-Gland is a principal research lead who conducts and publishes APQC research on process management and improvement, quality, project management, measurement, and benchmarking for APQC’s Process and Performance Management research team. Her research supports APQC members and clients across disciplines and centers on helping professionals and project managers solve business problems with strategy, process and measurement.
Holly regularly partners with other APQC research leads to look at improving the end-to-end business processes in areas such as procure-to-pay or order-to-cash where true improvement rests in the entire process versus one functional department. On a biannual basis, she conducts APQC’s extensive research survey and report on The Value of Benchmarking as well as annual surveys and reports on how organizations adopt and use the Process Classification Framework®.
She is a regular contributor for APQC’s blogs on topics of process and performance management, benchmarking, and IT and organizes monthly webinars on these topics for APQC members and subscribers. A few of her more in-depth research reports include, Transformational Change: Making It Last and The Value of Benchmarking.
Other Articles By Holly Lyke-Ho-Gland
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