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GET SMART: A CONVERSATION WITH DAN MADISON (PART 2)

Posted by on October 18th, 2012 with 0 Comments

Dan Madison is founder of Value Creation Partners, an organizational consulting and training firm. He’s also author of the best-selling Process Mapping, Process Improvement, and Process Management. He focuses on helping clients increase value through operational improvement, organizational redesign, cost reduction, and strategic planning.

Earlier this summer, I attended Dan’s intensive one-day seminar on process reengineering and lean techniques. After seeing what his methods did for my team, I had to interview him. Over the next four weeks, Dan and I will discuss how process mapping can make you, your team, and your organization SMART as Hell.

PART TWO: The goal of Process Mapping

Glenn: Dan, you conduct process mapping sessions that take one to two days and involve multiple people. What is the goal of a process mapping session?

Dan: There are multiple goals. I have in my mind, the four things I mentioned about my work: 1) mapping the process, 2) analyzing the process, 3) improving the process, and 4) redesigning the process.

Those four things are linked together. If you just did a process map, and did no analysis, improvement, or redesign, I feel like you’ve spent the effort to create the map and then didn’t harvest that effort. While it’s nice to know the flow of work and information, it’s even better to know what the issues are, and be able to address them – you know, fix them.

Glenn: Just to be clear, while the value of only mapping the process is minimal, you can’t skip this step, can you?

Dan: Well, you could, but then the analysis, improvement, and redesign would be flawed.

Glenn: So, you don’t recommend it.

Dan: Oh, no, no, no, no, no. Hell no.

Glenn: [laughing]

Dan: I think you have to do one, two, and three for sure. You have to map, analyze, and improve. And I think that – if you’ve gone that far – you might as well engage in a redesign. All four are linked together.

Glenn: So the first goal is to create an accurate map of the ‘as-is’ state.

Dan: Yes.

Glenn: The second goal is to analyze the map…

Dan: And that’s where I talk about the ‘lenses’ of analysis. So, Glenn, you can look at a process from these different perspectives. One perspective would be the ‘Customer Lens’.  Here we ask,

  • What is it that the customer needs, wants, expects, and requires from the process?
  • How well is the process meeting those needs?
  • Of those things, which ones are most important to the customer?
  • What would excellence look like on each of these items?

What we’re doing is asking the customer to – in essence – analyze the output of the process against what their expectations are.

Glenn: Do you often bring in the customer? Or are the participants role-playing on behalf of the customer?

Dan: Ideally, you would literally have the ‘Voice of the Customer’ there. It would be nice if there were somebody who had clear expectations about what they would like to see from the process. And their voice and/or ideas should be well respected.

Interestingly enough, Glenn, I do work in the public sector and in the private sector, and my public sector clients are much better at bringing – literally – the voice of the customer in the room, versus my private sector clients.

Glenn: That doesn’t surprise me, given the challenges with intellectual property. I know many companies are concerned about letting customers see what might be considered proprietary information or processes that provide a competitive advantage.

Dan: That’s right. It’s very difficult to get that transparency in the private sector.

A second lens is the quality lens. What we’re looking for is any time or place where something wasn’t done right the first time. There are two very powerful methodologies that address quality issues: Six Sigma and Lean. I have a bias for ‘Lean’ as the preferred methodology for quality issues.

A third lens is time. We have a methodology that fits that very well, which again is ‘Lean’. Lean does a phenomenal job of identifying different kinds of time and has a whole slew of methods, tools, and techniques for shrinking time out of a process.

Another lens is cost. We cost out the labor, overhead, and materials that are consumed in each step. That information is the backbone of activity-based costing, which tells us what the true consumable costs were as we performed the process. These numbers from activity-based costing are more accurate than in our managerial accounting systems. Folks who do activity-based costing really know what their true costs are.

Also, the cost lens is good at proposing solutions. You can calculate your Return on Investment, net present value, and payback method by costing out the ‘as-is’ process and then comparing it with what the savings are with the new process that will be enabled by some technology or some money being spent.

There are other lenses. One would be the value-added to non-value-added lens. A value-added step has three characteristics: 1) it’s the transformation of information or material into what the customer wants, 2) it’s a service feature, or 3) it’s a step the customer would pay for. Some folks identify the value-added steps and then try to figure out how can we optimize that, and in doing so, asking “can we get rid of the non-value-added steps?”

Another lens is the use of the ‘eight wastes’ as identified by Toyota. There’s some overlap with this lens. For example, our ‘quality’ lens also catches defects. And many of the other wastes are time related. For folks who become practitioners of lean, we try to get them to see the waste and then, by eliminating the waste, we end up building a creative flow for continuous movement of work and information through the process.

There are these varieties of ways – and I haven’t mentioned all of them – a bunch of different ways that you can look at the process from what I like to call ‘lenses of analysis’. They reveal aspects of things that are working and are not working.

Of course, the stuff that is not working is where our improvement efforts are focused.

Glenn: As you were talking about time, I was reminded of your session that I attended, and your discussion about ‘waiting time’. It sounded like you find a lot of that in your work.

Dan: You bet [laughing].

There are two ways that you can think about waiting. One is the ‘thing’ in the process. If you could call it up and ask it, “What’s happening to you now?” most of the time, it would reply, “Nothing’s happening”.

Glenn: [laughing]

Dan: Which, then, we would say that it’s in a waiting state. Another way is to think about the amount of time ‘you’ are waiting. This is when you’re waiting for an approval from someone or waiting for your system to boot, backup or whatever. So there are two types of waiting: there’s the thing that’s in the process waiting and then there’s us waiting.

Glenn: I love that image of calling something in the process and asking it what it’s doing.

Dan: It’s powerful.

Glenn: So we’re in this Analysis phase, and you’ve articulated the depth and complexity that this involves. What is – if you can sum it in one sentence – the goal of the analysis step?

Dan: It’s to identify what is working and what is not working in the process.

Glenn: Perfect. Then we enter the improvement phase. How do we choose what to ‘fix’ in this stage? Do we use a Pareto chart? Do we pick the greatest pain point? Do we go after ‘low-hanging-fruit’?

Dan: There are, of course, different ways of prioritizing what area you go after. It could be what’s costing us the most. It could be the thing customers are complaining the most about. It could be frustration by the folks who work with the process. Again, how we prioritize what we improve could be based on different criteria.

Glenn: Right. So a decision matrix of some type might be used to determine what steps of a process can be eliminated, added, or fixed to improve a process.

Dan: That’s correct.

Glenn: Finally, there’s the fourth phase – redesign. This phase seems to provide the highest value, and yet it seems to be the most challenging for many people.

I recently read another book on process mapping, and – throughout the entire book – I got the feeling that the process was the destination. The author talked about the process and showed how to map the process and gave clever mapping advice. The mapping seemed to be the output.

I think it comes across really clearly in your book – and your success stories – that you see redesign as the ‘Holy Grail’. With your book, the process map was just something that was happening because it had to happen in order for a redesign to occur. At no point do I get the feeling that you’re mapping for the sake of mapping.

And yet I get the feeling that not many people or groups are comfortable with redesign. They are much more comfortable with evolutionary improvement than redesigning on a clean sheet. Is that true?

Dan: I’m not sure that I’d use the word comfortable, Glenn. It’s more of a function of the creativity of the people doing the exercise. As you know, when we begin the exercise, I set two very challenging goals and I also say that how they currently do the work is erased. The sheet of paper is clean.

When you open a horizon and the doors are that wide open, it takes a person with a creative bent to be able to run with that. Whereas for folks who are more incremental in terms of how they do things, they’re going to go back to the ‘as-is’ and tweak it. This is quite common.

It’s really a function of the nature of how creative people are when they’re given that exercise.

Glenn: So, in this fourth phase – redesign – the goal is to build a new process on a clean sheet of paper, so as to optimize the flow.

Dan: Yes.

Glenn: Since this is the most powerful and difficult phase, and the one you’re most passionate about, we’ll dig deeper into redesign next week.

Learn more about Dan’s work and other resources in this interview below:

 

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