Improvement in Lean


Here's the diagram again!


How do you set your business targets, on a departmental basis?

How do your department targets and budgets reflect what customers value?

Now how do you improve the departments?

  • Purchase a CRM (Customer Relationship Management) system for sales staff to record all their customer contacts on – allowing marketing to “profile” these customers.
  • Buy a marketing system to allow marketing to conduct campaigns faster.
  • Invest in industry shows to demonstrate your latest product/service.
  • Send sales staff away on training course.
  • Re-brand your products or come up with a new logo!
  • Add new “value-add” product features.
  • Reduce costs to make the product/service more attractive.Invest in newer faster processing equipment for operations.
  • Invest in a new recording system to collect data on the operations division.
  • Set up new KPIs (Key Performance Indicators) for the service elements.
  • Create a "New Product Development" Process.
  • Introduce a new reward scheme for sales or service staff.

Each of these improvements will have been done independently in departments, after all each of the departments will have its own budgets, targets and KPIs etc.

(You may well have tried some of the above  and had some success over the short to medium term.)

We've established that customers (and You) buy and recommend products and services based on a mix of criteria;

Criteria that are owned by different departments!


QUESTION?

How do you measure the impact the “improvements” in one department have elsewhere?


If you are similar to the organisations we've worked with and researched then your departments only look to what they can influence, impacts elsewhere aren't measured.
If you want to read about the impacts that "improvements" can have in other departments then read the examples below, for
  • An "improvement" in one department that caused costs to rise and created customer service problems - CLICK HERE
  • An "improvement" that ignored customers and caused sales to fall - CLICK HERE
  • An "improvement" target which failed to meet customer needs but raised costs - CLICK HERE

We promised to let you in one the Principles and Tools which have been behind sustained revenue driving, customer focussed, continuous improvement and we promise they’re on the way! 

If you agreed with our diagram, then you've seen that products and services follow a “flow” across the departments in an organisation.

We've also shown that customers buy based on various criteria, criteria owned by more than one department!  

Why then do organisations measure and try to improve each department in isolation when customers buy the result of the "Product Flow" from the organisation?

We researched this question and after finding the answer we then set ourselves another challenge.

How do you create, measure and improve "Product Flow" ("the sum of the parts") in an organisation?


We looked for tools and techniques that had been used to answer this question.
 
We looked for clues in the organisations that have created sustained value and growth.

(If you want to find out which clues we looked for then give us a call!)

You maybe surprised, we were, many of the answers already existed!

However, they had, surprise surprise, been applied in isolation in departments and their total value not realised!

If you think you already manage by "Product Flow" then think about this one question….

 ….Do you measure the time it takes from thinking about conduct a sales campaign, the initial analysis, the product design, the marketing collateral production through to signing up and retaining the customers?

If so, BY HOW MUCH HAVE YOU IMPROVED IT IN THE LAST 12 MONTHS?

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