Myths surrounding systems & processes

For me the goal of systems and processes in any business should be improved effectiveness and efficiency. What does this really mean though? As we move rapidly into the 4th Industrial Revolution many of the “thought leaders” are shouting from the rooftops about AI (Artificial Intelligence), Robotics, AR (Augmented Reality), Nano-technology, 3D printing etc.

The World Economic Forum states : ‘The Fourth Industrial Revolution represents a fundamental change in the way we live, work and relate to one another. It is a new chapter in human development, enabled by extraordinary technology advances commensurate with those of the first, second and third industrial revolutions. These advances are merging the physical, digital and biological worlds in ways that create both huge promise and potential peril. The speed, breadth and depth of this revolution is forcing us to rethink how countries develop, how organisations create value and even what it means to be human. The Fourth Industrial Revolution is about more than just technology-driven change; it is an opportunity to help everyone, including leaders, policy-makers and people from all income groups and nations, to harness converging technologies in order to create an inclusive, human-centred future. The real opportunity is to look beyond technology, and find ways to give the greatest number of people the ability to positively impact their families, organisations and communities.’

On the other side of the coin Labour organisations are starting to rumble about job losses. Saadia Zahidi, the Head of Education, Gender and Work at the World Economic Forum, citing predictions that in the future up to 47% of jobs may be automated away, while other predictions are more cautious, suggesting a figure of only 9%.

Which ever way it goes it only really means one thing … we as business owners and as human beings are going to have to adapt and change they way we do things even faster than before. In reality 90%+ of businesses over the next 10 or more years will simply not be in a position to radically change their workforce into AI driven processes, so they will have to adapt in other ways.

At the end of the day your key assets in your business are your people. Are you using these assets to their full capacity? As business functions do become more and more automated are the people that are involved in those functions being freed up or tied down by the systems and processes?

This includes many of the major consulting firms and systems vendors who have the underlying mantra …. Best Practice ….

But what does this really mean? In my opinion it simply means “this is the way our system and/or processes works, and you need to fit into it”. Whilst many of them will talk about customization and and fitting the system and/or process to your business needs, the truth if oftentimes more likely to be that your business will need to adapt to their way of doing things. This is their playlist and they do not like deviations or variations on the theme .. these are the things that cost them money. It means that they have to think, adapt and provide real value.

Whilst I accept that there are regulatory frameworks, guidelines and requirements that businesses, especially big businesses, have to comply with, there are many different ways to to optimize the internal systems and processes of your business whilst maintaining or even improving your compliance to legislative requirements at the same time.

To be forced into modes of operation by a system simply because the vendor has designed it that way does not necessarily mean it will be the right solution or “best practice” for your business.

Key phrases often bandied about (and the myths I refer to in my title) are “its about efficiency” or “its best practice” or “this is the way the best businesses do it” or “we’ll customize it to suit your requirements”. To my mind these really mean the following:

“its about efficiency” – really means – “do it our way because it minimizes the thinking & effort we have to put in”

“best practice” – really means – “we’ve decided how your business should operate”

“this is the way the best businesses do it” – really means – “they think you are not a top business”

“we’ll customize it to suit your requirements” – really means – “we’ll tweak a few parameters to keep you happy”

At the end of the day YOU, the business owner is the person that knows YOUR business best. Yes, there is always room for improvement and third party inputs. We all fall into the trap of doing things a certain way just because! My warning bells start ringing when you are told that this is the way you must do things because ……….. This is the time when YOU should be asking the question the consultants should be asking you … WHY?

Why do you do this the way you do? Are the people involved in these functions simply slaves to the system or does the system free them up from repetitive tasks?

What are the real meanings of “effectiveness” and “efficiency” for my business? Many confuse these terms or think they essentially mean the same things. When in reality they are quite different.

Efficiency simply means you are doing things right … so you can be doing lots of things right or well but they may not be significantly impacting your bottom line positively.

Effectiveness means you are doing the right things … so the things that take you business forward in a positive manner.

Think about the Pareto Principle the 80/20 rule …. are your business processes 80% effective or 80% efficient? Many may argue that these are merely semantic differences, but think about it! Someone who is very efficient can still be virtually ineffective. They may be doing lots of things really well, but they are not doing the things that really matter!

The real goal here should be to design your business systems and processes to be at least 80% effective & 80% efficient! Then to enable your staff members on the same basis.

For me the key questions that need to be answered by any business of any size are:

1. What are the processes that currently exist in my business?

2. Are these processes being performed in the way they are being performed simply because that’s the way its always been done?

3. Have we documented those processes?

4. Have we studied each process and determined its impact on the business and the staff required to implement this process?

5. Is each processes effective and efficient?