How technology is reshaping process excellence

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On Business Process Management and Workflow Automation

32 min readFeb 9, 2018

The relentless technological transformation that has transformed life on earth is only set to intensify. Soon we could be facing a world of driver-less vehicles, of 3-d printing where you can design and manufacture your own products, and where tourists travel into space just “for fun”. Add onto this a world where everything is connected to everything else — the “Internet of things” we’ve been hearing so much about — and things are set to get a lot more interesting.

So what impact do these rapid and often disruptive technological advances have on how companies do business? And how can process excellence approaches — like Lean, Six Sigma and Business Process Management — better support businesses?

In this compilation of articles, leading process practitioners ruminate on what impact these changes are having on how companies need to approach and think about process excellence.

DIGITAL DISRUPTION — BE AFRAID. BE VERY AFRAID.

Contributor: Ian Gotts

Digital disruption is creating new business models, changing value streams, and provoking faster, more disruptive change than ever before. For those of you thinking that hunkering down and letting it blow past, like you did for previous trends — FORGET IT. This is not a trend. It is a permanent shift, says columnist Ian Gotts.

Digital disruption is a concept highlighted in Forrester’s recent CIO Summit and UK Summit and is the subject of James L. McQuivey’s new book which is due to be published in January 2013.

The key principles behind digital disruption are that it creates new business models, changes value streams, and is faster, more disruptive and more pervasive than any earlier change driver we have ever seen. Why? Because it is digital. And Forrester says that for those of you thinking that hunkering down and letting it blow past, like you did for previous trends — FORGET IT. This is not a trend. It is a permanent shift.

CEOS ARE SCARED, VERY SCARED

One good thing is that senior executives are aware of the challenge; 71% of global CEOs surveyed in IBM’s 2012 CEO Global Survey said the top external force of change is technology. Forrester CEO George Colony warned delegates at the CIO Summit: “There are many people now who want to disrupt your business. It does not cost much to disrupt business.” Business leaders are becoming more IT-savvy, according to Colony: “The average age of the CEO in the top 100 companies is 59. They went to college before computers. Most of the CEOs did not use computers. “But today, we are seeing CEOs who had Apple II home computers or IBM PCs at school.”

Digital disruption is a concept highlighted in Forrester’s recent CIO Summit and UK Summit and is the subject of James L. McQuivey’s new book which is due to be published in January 2013.

The key principles behind digital disruption are that it creates new business models, changes value streams, and is faster, more disruption and more pervasive than any earlier change driver we have ever seen. Why? Because it is digital. And Forrester says that for those of you thinking that hunkering down and letting it blow past, like you did for previous trends — FORGET IT. This is not a trend. It is a permanent shift.

PLATFORMS MAKE THIS POSSIBLE

This fundamental issue is that the new platform providers, such as Apple, Amazon EC2, Salesforce.com, are making it way faster and cheaper for new entrants to be disruptors and for them to get new ideas to market. Now it is possible to prototype not just new products and services but new businesses. Get something out and iterate to success, or kill it off quickly. So you current business is going to be challenged by either big players driving out thousands of new ideas or thousands of small new entrants each coming up with a new idea. So the advice, is disrupt yourself before others disrupt you.

SO WHAT ARE THE IMPLICATIONS?

There is plenty of evidence that technology is changing businesses. You only have to look at the print and publishing (newspapers and magazines), music industry (CDs and merchandising) and movies (films and DVD) to see the decimation of their industries. But now, no industry seems to be immune.

So the action is to start thinking about how your business could and should be disrupted. There is a 3 step process:

#1 It starts by looking at the current customer touch points, from a process perspective

#2 Think, creatively, about how those can change, be enhanced, be replaced, be augmented

#3 Design the processes to support the new approach from a customer perspective

This calls for more than process or business analysts. You are now in the business of creating new possibilities, not driving out incremental savings. People you could call on may be called Product Marketing Specialists, Product Strategists, or Product Management. You will be able to spot them. They are the ones looking very confused and frightened. Because their world is being turned upside down. They and you need to be given permission to think wild thoughts, many of which may come true and be a massive new market.

NEW ROLE, NEW VALUE FOR PROCESS PROFESSIONALS

Before you were measured in terms of the ROI of a project. Redesigning processes. Eeking out savings. But with this brief you can “re-imagine” whole new businesses or service lines. This is strategic thinking, with a seemingly unlimited upside. Plus it can elevate you into the upper reaches of senior and executive management. Important stuff.

Just don’t blow it. The company’s future depends on it.

WHY IT’S TIME FOR TECHNOLOGY ENABLED CONTINUOUS IMPROVEMENT

Contributor: Terence T.Burton

Workplaces today are complex, global networks, writes contributor Terry Burton, and that demands a different kind of approach to continuous improvement. Here’s why the future is about technology-enabled continuous improvement and what that would look like.

The recent meltdown and slow recovery has taken over 80% of Lean Six Sigma initiatives off the tracks, and left many organizations in a coma state in terms of the future of business process improvement. There are a few fundamental reasons for this dilemma:

#1 The age of “top down, enterprise-wide, train-the-masses, mandate compliance everywhere” improvement programs has served its useful life. No executive in today’s challenging economy wants to commit to another large, multimillion dollar improvement program that takes 2–5 years to see results, so continuous improvement remains somewhat at an impasse.

#2 The rapid evolution of technology is morphing the workplace into a complex global network of transactional enterprises. A few years ago everyone preached about “going to the gemba.” Now the gemba is following us everywhere 24/7 in our hands or certainly within reach of an iPad or some other mobile device. Lengthy improvement projects must be replaced by a more rapid process of improvement that incorporates real time, event-driven performance dashboards and business analytics.

#3 The need and urgency for improvement is high, the hidden costs of these transactional enterprises is astronomical, and a different approach is needed to harvest these new opportunities. These wastes do not have physical characteristics; we can only get at them through enabling technology and creative transaction stream analytics.

THE NEXT GENERATION OF IMPROVEMENT

The next generation of improvement is a challenge of how to design and implement continuous and sustainable improvement successfully in the new economy with the right approach, velocity, focus, simplification, and ease — while eliminating or working within the dynamic operating models, realistic constraints, and absorption bandwidths of organizations. What this means is the combined strategy of Deming back-to-basics, innovation, the integration of enabling technology, and adaptive improvement across diverse operating environments. The future of improvement is a nimble, systematic execution of this combined strategy that creates the continuous cultural standard of excellence. This is a well integrated system of improvement similar to the Toyota Production System (TPS) but a more dynamic system that leverages technology and harvests the larger enterprise and extended enterprise opportunities.

The next generation of improvement is definitely not a new buzzword program. It is a renewed direction of improvement that enables organizations to identify and harvest new opportunities rapidly, and prepares them to cash in on the even larger opportunities that they do not know about yet . We refer to this new generation of improvement as Improvement ExcellenceTM: the mastery of developing and implementing successful strategic and continuous business improvement initiatives, transforming culture, and enabling organizations to “improve how they improve.” Three key elements of this new framework is a more innovative process of improvement, a different focus via the fusion of improvement and enabling technology, and the development of a new organizational core competency of “improving how we improve.”

THE EMERGENCE OF TRANSACTIONAL ENTERPRISES

The new economy is accelerating the transformation of organizations into a complex global network of interdependent transactional enterprises. The physical content of work is being replaced with professional and knowledge-based processes.

For example, what was once a well established standalone automotive electronics manufacturing plant in Detroit is now a complex global supply chain network with several hardware and software development contractors scattered around the globe. In healthcare, the combination of consolidations, a focus on preventive medicine, information technology, ambulatory surgical centers (ASUs), and internet clinics are also moving hospitals in the direction of interconnected transactional processes.

Complexity in transactional business processes is growing, but so too is the need for improvement. This renaissance in improvement through technology is creating the greatest opportunities for forward-thinking organizations to improve, leapfrog competitors, and dominate global markets in the new economy. The future of improvement is definitely in the transactional enterprise and extended enterprise space of organizations, and the leapfrogging will occur at warp speed.

TECHNOLOGY-ENABLED IMPROVEMENT: A KEY DIFFERENTIATOR

Two trends will continue to radically change the face of improvement: the rapid emergence of enabling technology and a higher value-add content in transactional processes. With physical processes, one can use the senses to observe a machine’ performance, talk to the operator, count and categorize scrap, listen for tool vibration, or feel a leaky air hose . . . so the problems are very visible. As the shift in improvement occurs from the manufacturing floor to the transactional process areas, our ability to use our natural senses to solve problems diminishes greatly.

This calls for the need to blend continuous improvement methods with technology as depicted in the figure below to the right.

Additionally, the problems are much more complex. One cannot readily see the root causes of an invoicing error, a supply chain availability problem, a warranty issue, or product development leadership and process issues that make new products late to market or way over margin targets. These problems typically surface after the damage occurs, when it is too late for preventive improvement.

Reactionary damage control in the transactional process space is not improvement, but unfortunately it is the typical first response and usually makes matters worse. People tend to focus on issues within their own silos and are insensitive to the impact of their actions on the end-to-end process and the total value stream. The challenge of transactional problems is that the “roots” of the root causes are buried deeper in these complex, integrated processes. In fact, transactional waste has far reaching multi-directional consequences across the enterprise, and the quantified costs of non-conformance are usually astronomical and beyond belief.

For those who find this hard to believe, think about the millions of lost market opportunities from late or unreliable new products, excess/obsolete inventories, warranty and returns, premium freight, product availability, lost surgery and lab revenue due to poor scheduling and resource utilization, or the cost of ECO activities after a new product release to name a few. Each of these areas represents millions of dollars in lost growth, cash flow, and/or P&L opportunities for many organizations. Cutting headcount and IT budgets is not the answer to these complex but huge opportunities.

Transactional processes continue to become enhanced by new technology. Transactional processes are integrated and interdependent . . . where major improvements in one area provide residual improvements in other interconnected areas. The real challenge with improvement is in working one’s way through the transactional maze, and in defining and scoping out legitimate, data-driven transactional improvement opportunities. This process relies more heavily on information technology than it ever has before. With transactional processes, one cannot pick up a part and measure dimensional characteristics to determine defects and quality levels. One needs facts provided via real time event driven metrics, transaction stream mapping, digital performance dashboards, and business analytics.

The improvement expert uses the organization’s integrated enterprise architecture and other applications to trace the transaction trail like a forensic detective reconstructing and processing a crime scene to identify wastes and root causes. The differences between root causes and outcomes is often fuzzy, and the challenge becomes one of identifying and isolating the right pain point segments of these transactional processes with real facts. Success requires a deep understanding of both improvement and key business processes. This is not your traditional Lean or Six Sigma practitioner at work here.

Technology-enabled improvement plays a key role in this next generation of improvement. Technology is enabling this warp speed transformation of organizations into global, multilevel networks of transactional enterprises. Unlike most Lean Six Sigma improvement of the past, transactional improvement is transparent and comprised of key business processes, information flows, knowledge-based employees, and complex, contradictory decisions. There are literally hundreds of professional and knowledge resources managing thousands of dynamic process touch points, a continuous churn in changing requirements, specific country needs, time constraints, communications issues and exponentially greater opportunities for waste, variation, human risk, and bad decisions.

A major consideration of technology-enabled improvement that must not be overlooked is that the real intelligence lies in the improvement practitioner and the user community in the form of human intelligence. There is no improvement intelligence software available that instructs and/or executes improvement automatically, and we cannot replace the tough work of improvement with some new mobile application.

This is the current disconnect with business analytics activities in organizations today. If one is missing this core competency of structured and disciplined improvement, then technology is reduced to providing more information quicker — the old data rich, analysis poor syndrome. It is the equivalent of replacing the war rooms of manually prepared performance charts of the past, with digital dashboards that contain even more conflicting and non-actionable information.

People, knowledge, and talent create the improvement side of technology-enabled improvement. The integrated enterprise architecture provides the technology side of technology-enabled improvement, and this combination also optimizes the value and ROI of enabling IT investments. In terms of Lean Six Sigma thinking, the interaction effects of technology plus improvement combined produce much greater benefits than treating the two as mutually exclusive. History clearly validates that organizations have tried one without the other for decades and it does not create sustainable best-in-class business processes.

There is no doubt that technology is evolving faster than organizations can assimilate it successfully. The future is all about the correct fusion of formal structured and deliberate improvement with enabling IT. This future includes how to get the most out of existing technology and integrated enterprise architectures, and assimilating emerging technologies such as mobility, real time enterprises, cloud computing, and other capabilities as a strategic weapon of global competitiveness. For example, some of our clients running on SAP’s integrated enterprise architecture have built the capabilities of real time, event-driven and self-managed performance dashboards, data visualization technology, business analytics capabilities, simulation, and instantaneous access and monitoring of critical root cause metrics across the globe.

This is a huge game changer for improvement because it is transforming the traditional wave (batch), project-based Lean Six Sigma improvement activities of the past into living, real-time improvement. Improvement occurs in more of a Sense-Interpret-Decide-Act-Monitor (SIDAM) mode. Emerging technology is a major enabler of the next generations of strategic and continuous improvement. The challenges of harvesting these large-scale opportunities lie in an organization’s ability to evolve toward a state of Improvement Excellence™: improving how they improve through innovation and the correct fusion of improvement and enabling technology.

This article was created from Terry Burton’s latest book, Out of the Present Crisis: Rediscovering Improvement in the New Economy on release now.

TECHNOLOGY IS ONE BIG DOG — HERE’S HOW TO COPE

Contributor: Jeff Cole

Ever feel like the tail that’s being wagged by the dog? Technology is one big dog and if you don’t hold on you’ll get flung off hard and fast. On a daily basis, technology upgrades storm through the corporate landscape sending out tsunamis of change in their wake. It may even feel like the machines are winning — so how can you stay sane and productive?

With great technology comes great change. Buy a snow blower, learn it and you’re set for the next 20 years. But buy a cell phone, piece of software, or a computer and you’re good for what? 6 months, a year tops before another large learning curve slides your way. That’s just at home — you have to couple that with constant corporate infrastructure upgrades facing you from 9:00 to 5:00.

Back in grandma and grandpa’s day a major change came along and then they got to sit in the rocking chairs for a long spell, settle down, and go “whew — that was a doozy — are you ready for the next one?” Then they’d get up, stride forth and engage the next change that life had in store for them. Not anymore. The speed, amount, and complexity of changes coming at you today are greater than at any other point in human history — and many of those are technology-driven.

The onslaught of tech invasion into ones daily life is ever increasing. Sometimes it seems that anything that used to be mechanical is now electronic and comes with a 1” thick owner’s manual in seven languages. When I was a kid they promised that by now we’d own flying cars and robotic dogs. We’re not quite there yet — but just wait.

Technology and change — cause and effect. You are squarely on the receiving end of this equation. How can we best respond to this increasingly swift and complicated phenomenon and maybe even everage it to our advantage? First, realize that when technology drives change you need to absorb that change (during which your productivity will be lowered) and then rise to hopefully higher levels of productivity and proficiency. During this journey there is a mental, emotional, time and sometimes monetary price to pay. That can be draining — especially if you are juggling multiple changes at once.

Here are some tips for keeping the “price” of techno-change at bargain-basement levels:

Don’t fall in love with the past — stay nimble. You don’t want to be that guy who holds onto his “red stapler” until it’s pried from his grasp. Nor do you necessarily need to be an “early adopter” if you are not comfortable with it. However the sooner you resign yourself to the fact that you will need to plow through dozens of tech learning curves in your life, the sooner your stress will be lowered. Be ready for the next change, then roll up your sleeves and engage.

Keep an open mind — you will absolutely love some of the changes technology will hurl at you in the future. Others will likely drive you mad. While you are cursing the change, kicking your feet and banging on the desk, guess what — it’s changed yet again! And now, instead of being one change behind, you are two changes behind. Like it or not and ready or not — tech change is coming — it’s in your best interest to be open to it.

Apply the Pareto principle — for those not familiar this is the 80–20 rule that goes something like this: 80% of your results come from 20% of the effort. This applies to many scenarios in life including tech change where 80% of your learning may come during 20% of the time you spend learning it. Put Pareto to work for you! Jump in, immerse yourself for a short period and see if you don’t surprise yourself with how much you learn in a very short period. Often the period of dread that precedes opening the user’s manual is worse than just getting on with it.

Learn how to learn — This is a hotly debated topic and I don’t claim to have the definitive answer. However, most all experts agree with one universal truth on learning and that is different people have different learning styles. Some toss the manual aside and just play with it. Others parse through all the fine print. Some prefer human instruction. Others want video played over their smart phones while listening to MP-3s, driving, and drinking coffee simultaneously. What is the most effective style for you? (Note that “effective” and “favorite” may be different). Try out different methods of learning and see which works best for you. Then leverage that to cut down the amount of time it takes to ramp up on your next tech change.

TECHNOLOGY: ENABLER OR INHIBITOR OF IMPROVEMENT?

Contributor: Terence T. Burton

For those practitioners that are not paying attention, emerging technology is playing a major role in reshaping the playing field of continuous improvement. Many organizations have morphed themselves from geographically and country-specific sites into a global network of complex, knowledge-based transactional processes.

Manufacturing, in which many process improvement techniques evolved, represents a declining percentage of developed countries economic activity. Sure, manufacturing is still part of the chain, but a very small component in terms of the fully loaded costs of doing business globally.

ORGANIZATIONS HAVE MORPHED

The challenge of this transformation is that improvement practitioners are not able to use their normal senses to identify issues and new opportunities for improvement as they once could on the production floor when measuring yields, viewing excess inventory, listening to equipment vibration, detecting odor from poor ventilation systems, and the like.

Personally, I have observed too many unsuccessful “after the fact” attempts to port over Lean manufacturing and other shop floor-based improvement tools to the transactional areas with little actual results. Some consulting firms have guided their clients through months of blind effort value stream mapping every process in the office with no purpose or specific problem in mind.

I call this “Field of Dreams” improvement — if you follow the tool, the results will automatically come. The hard truth is that these naive efforts often lead to a dead end of “now what do we do?,” and does not serve much use other than a non-actionable, out-of-date reference covering a conference room wall.

I walked into another organization that had “5S”ed everything in the office including the copy machine, personnel and financial file cabinets, the paper cutter, and believe it or not — all of the individual fixtures in the rest rooms.

When executives finally see these types of results, the effort is quickly viewed as “non value-added” and therefore not necessary. But improvement is always necessary, and these false starts have demoralizing effects on people and teams that are sincerely interested in stepping up and becoming the champions of improvement in their organizations. In the transactional space, much more improvement creativity and innovation is needed than the traditional production approaches with its manual kanban cards, 5S exercises, symbolic signage and storyboards, and beautification exercises.

TECHNOLOGY CLEARLY ENABLES IMPROVEMENT

Today, new opportunities for improvement are coming at us in near real time, and it is necessary to adapt the philosophy and approaches of continuous improvement to this new norm. Additionally, the largest opportunities are the ones that we do not know about yet. Technology is the enabler of identifying and harvesting these new improvement opportunities.

A few of the larger enablers of continuous improvement include:

Data Warehousing: A central repository of data and information which is created by integrating data from multiple disparate sources. Data warehousing improves data quality and integrity by offering a repository of information that represents a single version of the truth. This is a must when attempting to improve complex transactional processes.

Business Analytics: The ability to analyze process performance in real time and make the right evidence-based adjustments. Business analytics enables us to execute what was once completed in a project, in real time using a critical thinking process that we refer to as a SIDAM (Sense, Interpret, Decide, Act, Monitor . . . and continue repeating the process. Business analytics provides that “6th sense” needed for transactional process improvement because users and practitioners cannot sense problems before and during the point when they happen, (i.e., feel an invoicing error, hear an incorrect shipment, touch new products that will be late to market or include field reliability issues, see premium freight, or smell a customer service or warranty problem). Silly analogies, but very true in transactional process improvement. In the transactional space, most organizations learn about problems after the fact.

Digital performance dashboards: This provides the ability to measure performance as it is occurring, almost like the stock market. Some of our clients have manufacturing work cells where assemblers complete their work, wand the product, and pass it on to the next associate in the cell. Productivity and quality are measured in real time at the cell and individual level. Another digital panel provides a Pareto analysis of problems experienced during prior builds and specific work instructions to prevent these unexpected defects. Other organizations view real time sales progress to the territory, region, and rep level; evaluate global supply vs. demand positions; monitor contractor quality performance; monitor distribution center and 3PL performance around the globe — and take the right data- driven actions to minimize problems. Well designed digital performance dashboards encourage real time engagement, empowerment, and self management.

Virtualization, Mobility, Cloud Technology: This allows for the ultimate management by walking around. In traditional Lean thinking, there was a saying that we “go to the Gemba” (go out and observe the workplace). In retrospect this is a limited idea. Technology has now placed the Gemba within our fingertips on our iPads and iPhones, on a laptop at a table at Starbucks, in a Go-To-Meeting session, in our automobiles . . . and more often than not at our children’s soccer games, baseball games, while dining in a restaurant, shopping at the grocery store, the bedroom night stand, and everywhere else. We are connected 24/7 in both our work and personal lives thanks to technology. What’s next? How about virtual meetings where participants can see each other but speak in their native language which is translated in real time for the rest members of the group. It’s not that far off.

Data Visualization: This is related to technology and deals with the emerging science of displaying data and information to convey ideas and conclusions effectively, both in terms of aesthetic form and functionality. Data visualization attempts to achieve a balance between form and function, thereby reducing perceptions and opinions about different individual’s interpretations about the end result. This is an emerging science as practitioners and researchers create data visualizations that not only communicate information, but reduce measurement system error by engaging people in the right single interpretation of the results, and the right evidence-based corrective actions.

There is a series of underlying assumptions that make these components true enablers of improvement. The most important factor is that an inseparable fusion of technology and improvement must exist in the implementation process.

In other words, organizations cannot pursue these enablers in isolation of business process improvement without severe consequences.

The improvement opportunities in these complex transactional processes are huge: millions of dollars of opportunity in a single project. Harvesting these new opportunities requires the organization’s ability to evolve toward a state of Improvement Excellence™: improving how they improve through innovation and the correct fusion of improvement and enabling technology.

TECHNOLOGY CAN BECOME AN INHIBITOR

There is no doubt that technology is evolving faster than organizations can assimilate it successfully. Unfortunately, technology is also pushing the immediacy and instant gratification factors of decision making. The future is all about the correct fusion of formal structured and deliberate improvement with enabling IT.

This future includes how to get the most out of existing technology and integrated enterprise architectures, and assimilating emerging technologies such as business analytics, unshakable performance dashboards, cloud computing and virtualization, and other capabilities as a strategic weapon of global competitiveness.

Technology is a huge game changer for improvement because it is transforming the traditional wave (batch), project-based linear waterfall approaches of improvement activities of the past into living, real-time improvement. As we mentioned earlier, the future of many elements of improvement will occur in more of a Sense-Interpret-Decide-Act-Monitor (SIDAM) mode.

The historical problem with emerging technology is that it is usually viewed from too much of an IT perspective and not enough from a business integration and user development perspective. Currently there exists a huge missing link between the human talent development, and the technologies being marketed by the software community such as cloud computing, event driven performance dashboards, business analytics, and data visualization.

A major consideration of technology-enabled improvement that must not be overlooked is that the real intelligence still lies in the improvement practitioner and the user community in the form of human intelligence. There is no improvement intelligence software available that instructs and/or executes improvement automatically, and we cannot replace the tough work of improvement with some new mobile iPhone application.

These complex transactional processes include a lot of unpredictability, professional judgments vs. hard data, a high degree of informal activities underlying a formal process, and fuzzy cause-andeffects in space and time. The seasoned improvement expert knows how to use the organization’s integrated enterprise architecture and other applications to trace transaction streams like a detective conducting transactional forensics as they reconstruct the waste crime scene of the process or look for hard evidence of the supposed problems and opportunities.

Transactional forensics is a very appropriate name for this approach: it involves setting up deliberate process experiments for transactional stream mapping and classification to either discover the root causes and magnitudes of problems, and/or to verify that problems have been eliminated through the right data-driven improvements and corrective actions.

There is another emerging cultural challenge called the XBox and MTV generation who grew up on technology and uses it as a matter of fact. My son can text blindfolded faster than I can type, and I often find him capable of instant answers about tomorrow’s weather or an address and GPS directions for a new restaurant! A closer look at these behaviors reveals that it is moving us more towards instant gratification and further away from critical root cause thinking and the social aspects of problem solving.

Today, many people send a text or email — any time of the day or night — and expect an answer immediately. The window of critical thinking is shrinking — or maybe closing a bit. The new generation of workers are using technology in many cases as an end rather than a means (or enabler) to the end. Just because some-thing shows up on a display, it does not mean it is the truth or a fact. This discussion is not intended to be a criticism of our upcoming generations but to point out a radical shift in how we are dealing with problems.

Regardless of what technology is available, people must not forget that they still need to think and go through the basics of listening to and synthesizing information, drawing the right conclusions from fact-based information, making the right data-driven decisions, taking the right actions with technology, and making sure that tech-nology is working well as an enabler of whatever they are trying to accomplish. What this demonstrates is an urgent need to integrate improvement and technology.

The process of improvement still relies on human intelligence to define and segment the right root cause information, analyze data with the right methodologies and tools, draw the right, data-driven conclusions, take the right fact-based actions, close the loop with the right performance metrics, and continuously repeat this cycle. The bottom line is that if you place technology into the hands of a user community that either does not know how to conduct true root cause problem solving, doesn’t have the time, or does not believe that all of this is necessary, the organization is reduced to “winging it” with new technology and achieving the wrong results.

Organizations have talked a good game about integrating business process improvement and technology in the past. The sheer availability of never ending emerging technology and distribution models (e.g., cloud computing, Software as a Service or Saas, mobility, web-based architectures, etc.) presents an opportunity for organizations to take improvement into the next logical generation and discover new opportunities beyond belief, or accelerate mediocre or bad decision making — also beyond belief.

The user community must also develop both a deeper knowledge and appreciation of end-to-end business processes, and the core competency of structured and disciplined improvement. Otherwise technology is reduced to providing more useless information quicker — the old data rich, analysis poor syndrome. It is the equivalent of replacing the war rooms of manually prepared performance charts of the past, with digital dashboards that contain even more conflicting and nonactionable information.

ENLIGHTENED LEADERSHIP MAKES TECHNOLOGY ENABLING

We cannot discuss technology-enabled improvement without mention of the importance of a new leadership style and approach. Leadership is always the “hemi engine” that enables continuous and sustainable improvement. Leadership is also the reason why the word “continuous” keeps falling out of continuous improvement.

A familiar saying in the continuous improvement arena is “the soft stuff is the tough stuff.” Enlightened leadership is the engine of success and sustainability — and this includes technologyenabled improvement. The specific elements of improvement strategy, planning, and leading great transformations are often oversimplified or overlooked completely, and they are covered superficially at best in most books on improvement. All executives embrace the concepts of internalization and culture change, but many put little real commitment and effort into it because of its ambiguous and intangible nature. Consequently, cultures in organizations happen more by default than deliberate design, creating oscillating performance from improvement initiatives.

The Chief Information Officer (CIO) must play much more of an integrator role with technologyenabled improvement. This enlightened leadership role leads cultural transformation to become a definable process — with deliberate leadership behaviors, choices, and actions . . . and definable suppliers, inputs, practices, outputs, and customers. Cultural transformation occurs when the right executive behaviors, choices, and actions are guiding this process. Enlightened leaders recognize the potential of technology-enabled improvement as a springboard into future success. They make the right investments in technology infrastructure and human capital to achieve new levels of greatness.

Great organizations do not wake up one day and discover that they have a winning code of conduct and value system; their executives have deliberately created it with a higher moral purpose of improvement, deep passion and unwavering commitment, a bold plan, and the patience to play out their strategy over time. Continuous improvement is first and foremost, the only cultural standard of excellence, and a highly recognized and valued enabler of strategic and operating success. Furthermore, it is a never ending process of reinforcement and renewal. Improving how we improve cannot be accomplished with old thinking because too much is continuously changing the structure, processes, and social complexity of improvement.

SUMMARY

For the most part, traditional improvement as we know it is a commodity especially in its concept state and its traditional manufacturing applications. More fads, meaningless academic and intellectual discussions, showboat demonstrations of improvement and “knowing how to” improve is not good enough in this challenging economy. There is a serious need to take continuous improvement to the next levels of superior performance, and we have the right formula for success to make this idea a reality with huge payoffs.

Technology is the new game changer, but it will not make the permanent process of enlightened leadership any easier. It all begins with enlightened leadership that is committed to continuous improvement as first and foremost, the only acceptable cultural standard of excellence, and a critical enabler of strategy execution and business success.

This next generation of success depends on implementing continuous improvement with a combination of Deming’s back to basics, emerging technology, creativity and innovation, and adaptability across a wide range of industries and operating environments — and doing it in a deliberate and systematic way that is superior to everyone else around the globe.

Technology-enabled improvement has widespread applications in industries less experienced with continuous improvement such as healthcare; federal, state, and local governments; municipalities and airlines; energy and utilities, and many other industries. However, the moral purpose of improvement is much greater than improving P&L statements, growing the revenue line, or cutting expenditures and entitlements.

Both of the topics discussed here (improvement and technology) are extremely complex and difficult to implement correctly, and even more difficult to grow the tangible benefits and sustain the continued progress of success. Emerging technology and major transformation in general has a learning curve, and I am confident that we will also figure out how to rebuild a stronger global economy through this next generation of technology-enabled continuous and innovative improvement.

BANISH THE SILOS — HOW I.T. CAN LEAD COMPETITIVE ADVANTAGE

Contributor: Ben Blanquera

The DNA strands of business are most often embedded in processes related to the bits and bytes contained in our information systems. But IT — the department that often has one of the widest fields of view relative to efforts, budgets, changes, and focus — is not strategically leveraged in many organizations, says contributor Ben Blanquera. Here’s how IT can add value via a seat at the strategic table.

Learning to see an organization as a system and learning ways to lead an organization as a system are typically not taught in most management degree programs. In fact most management practices tend to undermine the optimization of the system. Typical status quo practices tend to create internal competition and drive fear in to the culture (as Dr. W. Edwards Deming said to drive out fear). The internal competition and fear in turn creates barriers to cooperation among departments throughout the system.

Simply put: systems theory is based on the principle that each organization is composed of a system of interrelated process and people, which make up the system’s components. The success of all wokrers within the system is dependent on management’s capability to orchestrate the balance of components for optimization of the entire system, not just optimizing sales or operations or procurement or customer service or….

And therein lays a competitive advantage of Deming’s body of work and systems thinking, which you can read more about in an earlier series in this column: Systems Thinking and the Three Musketeers.

Namely, if your organization operates as a true system and if the organization is led as a system which cooperates, you have an advantage. Why? Because it is likely that your competitors are merely using accepted management practices which destroy or prevent cooperation and systems thinking.

If the management practices of your competitors have created silos in their organizations, they will have reduced information flow and insight to the rest of the organization as each silo attempts to protect their own turf. That means what is actually happening in their organization becomes opaque to leadership. So not only will you have greater insight into what is really going on in your organization, you’ll be able to move more quickly and effectively because you won’t have the silos protecting their own turf and status quo.

We see the dysfunction of silos and internal competition for resources quite often in the Information Technology (IT) arena. For example, we witness senior leaders jockeying to position their development projects ahead of a projects from other departments. They and others take that competitive approach because they are measured on what they contribute via their own department, not what they can contribute to the optimization of the entire organization. Of course, this jockeying slows down development, creates a great deal of rework and causes stops/starts as power struggles dance continues. People become alienated, cooperate less, and fear that they might be in a losing department. All of this makes the organization less competitive.

Knowing what is really going on is very important in a world in which the system of your business, the DNA strands of your business, is literally all over the map. The global village of business means that success comes from effective coordination of numerous inputs, transformations, and outputs to and from the system –knowing the status of those inputs, transformations, and outputs and making the most of them.

This is true for innovation as well as for competiveness. Are we working on things that will truly make a difference and enhance our competitive position? How much of our treasure is being focused on building new capabilities versus maintaining what we have? Are we applying our resources to the right projects –those which aid in optimizing the success of the whole? Or, are we jockeying for position to protect our silo?

The DNA strands of business are most often embedded in processes related to the bits and bytes contained in our information systems. Hence, IT can play a much more strategic role in the creation of value for an enterprise by releasing change into the environment (though software and enabling technologies). In our technology-enabled world a currency of innovation is the release of new software.

Further, IT departments in our organizations have in their possession the Rosetta Stone that can reveal the pulse of our enterprises. It’s ironic that the IT team -which has one of the widest fields of view relative to efforts, budgets, changes, and focus — is not strategically leveraged in many organizations. Instead, IT is thought of as merely a utility; sometimes as a trusted “supplier”. Seldom as an internal strategic, cooperative partner.

To test the theory let’s ask ourselves the following questions:

 What function is typically involved with any business process changes?

 What function has visibility to all the data of our enterprises?

 What function typically leads the project management endeavors?

If you’re like most organizations your answer to most of the questions above is Information Technology.

With that in mind let’s go back to the notion of orchestrating the balance of components to optimize the system and talk about some possibilities that now occur when one can really see and gauge the activities of our enterprises. By leveraging the latent visibility in our IT departments decision-makers would benefit in a variety of ways, including these:

 Provide visibility into where investment in development projects is happening. This would help to ensure that the right processes are being built at the right time.

 Provide granular insight to customer, market, and competitor demand curves that drive organization responses.

 Provide an end-to-end view of where process bottlenecks are occurring.

 Provide a snapshot across the organization of expensive duplication of development projects.

 Provide insights into process architectures to identify opportunities for scalability and agility.

The point here is that IT can add value via a seat at the strategic table. IT can do this by measuring, monitoring, and mining data, not just about metrics, but about activities/development going on (or not going on) throughout the organization. IT’s cross-organizational view can provide senior management with a holistic and systems view of enterprise activity and bottlenecks. Here is one real world example:

“Customer Voice/Data Analytics” is a burgeoning field. Customer call-in data (complaints, warranty questions, level of frustration or joy, and the like) can be mined and used by marketing, market research, sales, product/service development and the like. Yet, too often the voice-of-the-customer nuggets get stuck in the customer service silo even though other departments would welcome having the data. At other times, departments such as marketing do not welcome the data from customer service and indeed are uninterested in the data because it was “not invented here in our department.”

IT is in a unique and important position to identify losses (such sub-optimization of useful data) that departmental silos cause. In this case, IT is usually the central node of installing and supporting the customer voice/data analytic software. Thus, IT sees the potential –and could help assure the data is utilized widely. Certainly that would help with competitiveness. Other examples abound.

Systems thinking as Deming described it –combined with a greater use of the IT function for strategic purposes — would also help address a growing issue in the USA. We have witnessed a lessening of interest in computer science. It may be only a matter of time before other nations experience the same trend and find their base of developers eroding. There are many reasons for this erosion, of course. I postulate that one reason students aren’t being drawn to IT is because more and more IT organizations have been pigeon-holed into operating as utilities, rather than as strategic partners. This makes IT less attractive as a career because the potential to make a difference via IT is lower than it was 10 years ago.

We can help to reverse this trend by recognizing and assuring that IT plays a strategic role. It’s a win win: organizations enjoy the benefits of having a system-wide view of what is getting done and what isn’t, and can attract more people to the computer science field.

I encourage IT leaders and those people making their careers in IT to study Deming’s Management Method, which not only includes the systems thinking piece, leadership, transparency, and continuous improvement, but also includes looking at data through a new, sharply focused lens. In my experience people in IT really take to Deming because of the sensible rigor of his approach. If Deming were a developer we could say he created “elegant” work –value added, very efficient, very productive, and creative. In fact, many of the Agile Manifesto Software Development Principles are rooted in Deming’s approach.