Before Process – Define Purpose and Value

When pursuing an improvement activity, it is absolutely critical to that one defines the process of the activity to be improved.  Whether this is an effort to reduce cycle time in an operation or the installation of a new IT system, understanding the process is essential to ensuring the improvement is successful.

However, before diving into process definition, it is even more important to take a step back from the process and first ask, “What it the purpose of this activity, and what value does it provide the customer?”

For activities around new processes, products, or services, organizations typically consider Value in order to determine whether or not the new activity is worth doing.  Many even check to see if, once implemented, the activity delivered the Value that was promised, usually through some sort of benefits realization exercise.

But, what about for existing activities?  How often do we look at our current activities and determine the purpose (why are we doing this?) and the Value the activity brings to the customer, especially before attempting to modify or improve it?  Because defining purpose and value is often deemed “Strategic” people feel that strategy is someone else’s responsibility.  While setting the strategy may indeed be done at the board level, thinking strategically is everyone’s responsibility.

It is this Strategic Thinking aspect that is simply overlooked or assumed, and thus our desire to jump straight into the Tactical portion, where some may say is the place “things get done.”  While “things” may get done at the Tactical level, if you’re not working on the right “things” that either add value or keep you from adding value to your customers, you’re wasting your time.

Before we can even start talking about the Process, we must define the Purpose (the why) and the Value that is delivered to the customer.  Once this is determined, with involvement of the People, then a tactical focus on the Process can begin.

Let me know your thoughts!

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2 thoughts on “Before Process – Define Purpose and Value

  1. Glenn,

    this is an area I’m giving a lot of thought to for various reasons. Specifically, what is the order of things necessary for creating new ways of doing things? (what I’ll call an endeavor)

    My thoughts are a little different then yours, but my starting point is probably different also. Let me summarize my approach below first.

    New Endeavors:
    There is a purpose or reason (stated or unstated) that someone want to undertake an endeavor. This endeavor must be done within an environment. First one has to understand the environment. Second, one lays out an infrastructure for the endeavor. Within that infrastructure, there are systems necessary to do certain things. Around those systems, one creates processes governing how things start, proceed and then complete.

    Note: to me, systems and tools are synonymous.

    Including your thoughts about purpose and value, within the environment, there is a reason someone wants to do something. That is the purpose. Then one builds the infrastructure, systems and processes to deliver value that meets the purpose.

    If the value is greater then the cost, the endeavor might continue. More specifically, if the value can be sold at a price that is greater then the cost, then the endeavor generates profit for the business. If the price is less then the cost, then someone has to evaluate if there are still reasons to continue.

    If I understand the chain, there is a request or a purpose that causes an improvement activity or endeavor is started. There are costs for the people, infrastructure, systems and processes necessary to conduct the endeavor. The endeavor produces value that a customer is willing to pay for (hopefully). The value either justifies the cost or some other, noneconomic reason justifies the cost of continuing the endeavor.

    Does that make sense?

    Andy

  2. Glenn,

    Good stuff. You are exactly right. When people focus on how to do something instead of what and why, they get lost in the weeds, create waste, and leave innovation opportunities on the table. We call this problem “The How Trap!”.

    I like to use capability models to map business value to the how’s of the business. http://www.dennisstevens.com/2009/08/14/capability-analysis-start-with-business-value/. Having the people in the organization participate in the definition of the Capabilities and the scoring of Business Value, Performance, and Risk helps people think about the way that their activities map to the business strategy.

    Understanding and prioritizing at the What level is a very powerful tool for Business-IT alignment and for focusing Process Improvement efforts.

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