Welcome to the second edition of BUSINESSBOOST — the latest in a series of business briefings from Blue Stone Business Solutions, a specialist and independent information technology consultancy business.

The topic covered in this issue is process design.

In the last issue we looked at IS strategy and if we didn't hear from you in the meantime then I'm guessing you're confident about where your business systems need to be to support your future plans. But irrespective of whether you have a formal, detailed and robust IS strategy in place, you may now be wondering how best to move forward. In any event, this next stage could help you identify big savings or realise significant business improvements from your current systems.

But let's consider in some depth what we mean by process design.

Those of you who read our last issue will recall our belief that the IT issues facing the majority of businesses fit into a cycle of events, which can be summarised as follows:

This shows where we see process design in the overall scheme of information systems: as the output from a review of your IS strategy, and as the input to acquiring the systems that your business needs to grow and prosper. But our starting point is to identify the processes that your business employs now, and to see whether these are as smooth, efficient and as streamlined as they can be. We would look at the flow of information to and from your customers or your suppliers, and at information flows within your business — on the shop floor, in finance, human resources or sales & marketing. Our goal is to ensure that you are not incurring unnecessary extra costs and other resources because your systems are more complicated than they need to be.

A significant benefit to working with Blue Stone is that our objective is not automatically to persuade you buy any new systems, but that we are there to help you solve business problems, reduce costs and gain competitive advantage through the use of your current systems — provided they’re up to the job. Also, by streamlining or independently reviewing your business processes, we make sure that if you do have to replace your systems, the new system reflects today’s or tomorrow’s processes — not yesterday’s.

Business processes evolve over time — often in response to short-term problems or staff deficiencies, departments being re-organised or company acquisitions or mergers, and these aspects of modern business life can fragment existing processes. In addition, new technology may have been overlaid onto old processes. Rarely do you get to start from scratch and create something designed specifically for your requirements — we give often you the opportunity to do just that.

The benefits of a thorough process review or re-design typically include:

• reduced operating costs by eliminating processes which do not add value
• reduced process times/improved response times
• simpler processes leading to better staff understanding and fewer software modifications and errors

However, if you definitely do need a new system, we will help you to identify and acquire what you need, not what you think you need to support the old cumbersome processes that currently exist in your business.

The case study below shows just how this approach helped one of our clients to understand the stages they went through and subsequently to re-engineer their business.

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When we look back on the numerous process design projects we have conducted over recent years, we have invariably been able — in a relatively short period of time (often as little as one working week) — to have identified significant scope for improvement in our clients’ processes. Once these have been redesigned and new systems subsequently introduced, there have either been marked efficiency improvements and/or reductions in cost.

Because we are confident of our ability to review the position and come up with practical, cost-effective solutions, we are willing to undertake an initial exercise for you at 50% of our normal rates†. However, in case you’re wondering if this is just some hit-and-run marketing strategy, then you should know that we tend to work with all of our clients over the long term, often working alongside them over many years. Businesses tend not to do this unless there are sustained improvements, and this is precisely what we aim to deliver. But don’t take our word for it, talk to one of our many satisfied clients, a number of whom will be able to tell you about their dramatic improvements in systems capability or significantly reduced IT costs as a result of our involvement. Immediately below we have described one client’s views of the benefits they gained from such an exercise.

†This offer is limited to the first 10 days of services provided and is only available for the initial project with a new client.

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A business is like a printed circuit board, but with information not electrons

Our client, a major electronic equipment manufacturer, needed help with the selection and implementation of a new Enterprise Resource Planning (ERP) system.  But in embarking on this project, they felt that to get the maximum benefit from any new system that they would need to review their core business processes. So they asked us to get involved because of our ability to support them through the entire project including strategy, process design, system selection, contract negotiation and implementation.

The best approach when reviewing the processes at the heart of any business is to take each process completely apart and see how best it might be redesigned. Our strategy to achieve this in this instance was to set up a series of intense workshops, lasting 3–4 days each. For each workshop we first agreed a clear scope, agenda and precise timings; in our experience it is vital to drive these workshops against clear deadlines, otherwise there is the danger that they become talking shops with little or nothing concrete achieved. We then agreed with senior management who the participants should be to get the best result, and this often included senior Board members. This ensured senior management commitment both to the project and the redesigned processes.

Once the workshops started, our role was to facilitate them, making sure that timescales were strictly adhered to, that the work was done thoroughly and, where necessary, challenging the team members to ensure that we got radical and practical solutions. The normal pattern to these workshops was as follows:

1. Confirm that all participants completely understood the objectives and agenda:
   It was vital that everyone understood what they were trying to achieve, such as reduced lead times, reduced costs, improved customer service etc. Any misunderstanding at this stage could have completely undermined the success of the workshop.
   
2. Map the old process:
   This needed to be done in detail, including the core process and any significant variants and error loops. What was very important was to map the actual process used, not what people thought was used or what was in the procedure manual. We normally use simple tools like brown paper rolls and post-it notes to capture the process, which can be electronically documented later.
   
3. Analyse the process:
   In this stage we measured the performance, including elapsed time at each step, costs (usually manpower), error rates at each step and issues or problems with the process that the team members were aware of. This gave the team a good idea of where to focus attention for improvement.
4. Brainstorm new ideas for the new process:
   This was a free-wheeling discussion. By this time the team had a very clear picture of how the old process worked (or not) and where the problems lay. This included re-organisation of the process, better controls, new technology, and in many cases the complete removal of process steps or stages where they did not add value. No idea was dismissed.
5. Draw up a new process incorporating the new design ideas:
   This is where the practicality test was then applied to ensure that the new process could work in the real world. The new process was documented and where necessary, other people from around the business were brought in to check that the process would work and deliver the benefits anticipated.
6. The final stage was to draw up an implementation plan:
   Along the way the team identified a number of ‘quick-wins’ that could be implemented immediately with little or no cost. These were assigned to team members to be introduced straight away. The implementation of the remainder of the new process was also planned. While some elements could be implemented over a matter of days or weeks, others would take longer, particularly if they relied on new equipment or computer systems.

Once all of this had been documented, the task was not over. A key element to our approach was the stabilisation of the process whereby the team reviewed the implementation and operation of the new process over the next few months to ensure that the objectives were being achieved and further improvements applied. In our view this is one of the key ‘secrets’ to success in process design work.

The result of all of this was that the re-designed processes delivered substantial benefits in terms of reduced cost, elapsed time and inproved customer service. They also laid the foundations for ERP system specification and selection which we subsequently helped our client through.

Process design does not always deliver its promises. The key factors in ensuring that it does include:

• strongly facilitated and intensive workshops that deliver results quickly
• a focus on rapid results (quick-wins)
• strong follow-up actions that stabilise the process and drive the benefits out

This client is just one of many companies where we have applied our tried-and-tested approach to process design. Every business is different, but the need to have a clear grasp of what is happening ‘under the bonnet’ is a constant, since the alternative (‘muddling through’) is a recipe for inefficiency, wasted resources and, ultimately, reduced profitability. A well-defined set of business processes can save your enterprise much needed resources: manpower, time and/or cost — often all three.

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Next month’s newsletter deals with system acquisition: replacing or upgrading existing systems, or acquiring them from scratch. Taking what came out of the process design phase and identifying the optimum solution to meet those needs.

However, if we haven’t been involved prior to this, we still offer our skills in developing a specification of requirements with which you can confidently approach the marketplace. The key things that we bring to the table are our ability to define and agree your requirements with you (in ‘business speak’) and to translate this with the supplier (into ‘IT speak’) in order to acquire the optimum sytem for your needs. As always we will have a case study to substantiate our claims and demonstrate our business credentials.

If you feel you could benefit from an initial discussion with Blue Stone now, then please let me know, either by phone, e-mail or by clicking here. I look forward to hearing from you.

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