Finding the Holy Grail of true organisational productivity is a challenge, but not an impossible task.
The temptation when embarking on a crusade to identify and measure the work that organisations are completing, is that we often start to measure individual activities, rather than productive outcomes.
Finding True Value Add
“Finding and measuring your operations productive outcomes is the key to practical transformation and performance optimisation.”
Whilst measuring activities at a granular level can assist in identifying waste and best practice, it doesn't always encourage the right culture, or lay the correct foundation for understanding true productivity.
The effective measurement of productive outcomes will help to eliminate re-work, identify best pratices and avoid staff "cherry picking" from the workflow to produce exaggerated results.
This ensures the integrity of the measurement and a level playing field for staff, leaders and executives to manage performance and lead process excellence in their business.
Identify Waste
Its one thing to identify the productive outcomes that your business is creating, it can be another challenge altogether to identify the outputs that are spending energy, and wasting you and your customers time.
By isolating and measuring these 'waste'activities, organisations can adopt continuous improvement programs and share best practices to help reduce or eliminate. Applying an Activity Based Costing model can add further insight by demonstrating the cost impacts of these processes on your operations.
Your Activity Based Costing (ABC) capability can be used to build a business case for change, measure the impact of special events and monitor benefits realisation in real time.
There are a range of tools and experience available to apply a working ABC model in your organisation, measuring the cost of inefficiency, process waste and error waste.
The Power of Observation
“Data is great, feedback is good, but nothing is real until it is observed.”
Whilst leveraging effective measurements is a great start, it is only one component to understanding the opportunities in your business operations. Reading and understanding the data is fantastic as it provides leaders and individuals with insight into performance and how to optimise the engine.
Taking the time to get feedback from staff and customers is vitally important as well, adding even more insight into the mix by examining the voice of experience to describe how the business is running and the experience that it is creating.
However, Nothing is real until it is observed...
Analyse the data, speak to your people, understand your customers, but do not lock anything in until you have observed it for yourself... ever...
Take the time to sit with staff and observe their work, don't just ask them questions. You will find that the results differ dramatically.
This is not to say that data and feedback do not have their place, indeed they are important elements that cannot and should not be ignored. They often provide insight that is both insightful and relevant.
"Nothing is real until it is observed..."
Shared Metrics
To ensure that continuous improvement is sustainable in a culture that challenges from within, organisations should think carefully about applying shared metrics that reflect the overall operational performance of the business.
Clear, simple, shared metrics that demonstrate the amount of customer value add that is being produced can help to galvanise large and small work-forces alike to achieve common goals.
A common objection to deploying shared metrics can be the lack of direct accountability for various tasks and processes. This is counter intuitive to what we are trying to achieve for customers and business efficiency.The greatest enemy of shared metrics are silos and poor leadership, collaboration and insight its greatest ally.
Balanced Scorecard
When considering options in measuring your workforce's productivity performance it is essential to include metrics that are aligned to a balanced scorecard that includes customer and quality outcomes, along with essential values and community driven metrics that align to your company strategy and ethos.
Measuring and managing productivity in isolation is a poison chalice that can drive short term outcomes, without delivering sustainable long term operations performance.
About the Author
Stuart Nielsen
Stu has been transforming financial services business for over 2 decades with his unique style of people leadership and problem-solving acumen. Never afraid to tackle the complex problems in any facet of an organisation, Stu will bring a sense of reality to any problem and leverage the combined energy of your people to create a high performing business.
Capable of working at the strategic end right through to delivery and knowledge transfer, Stu's strength in communication is an asset to any organisation trying to make sense of its self and drive change towards a common purpose.
"Data is great, feedback is awesome, however nothing is real until it is observed"
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