Why Process Matters

I have a job that most people would find either very interesting or very boring.  I’ll let you decide which, but essentially my job is to help people quantify the financial benefits of Optimizing their Investment in their people.   Which people?  Their employees, human capital, talent, etc…   It’s a hot topic at the moment, and certainly the economy has increased the importance of making “smart” people decisions.

 

For the most part, your average company invests the vast majority of their dollars in people, process, and technology.    Out of those three, People are (typically) by far the average company’s biggest expense.  Research has actually shown that 70% of most company’s operating cost is People related.     So I’m here to talk about optimizing your people investment right?  Not exactly.   Today, I’m writing about the “other P” – Process.  Or to be more exact, your “People Processes.”  Confused yet?  Keep reading…

 

First of all, people and process are linked.  The definition of Process in a business context is “a method or system for achieving a commercial result.”   Put simply, it’s a method or system that your people execute on to drive commerce  - i.e., goods, services, cash, revenues, margin, etc…   If you have inefficient processes, then you’re hindering your company’s (People) ability to execute and drive commerce.    When I’m speaking with executives about the business impact of “Workforce Optimization” many of their eyes start to glaze over when I discuss the value to the organization of creating more efficient people processes for their Front-Line Managers and HR staff to execute on.     The CFO or COO will tell me that those are “soft” benefits and they aren’t interested.    Technically, they’re right – if a process improvement doesn’t allow you to reduce or re-allocate resources, then it is indeed a “soft” benefit.  However, the line between “soft” and “hard” benefits is blurry at best and I would argue that you can’t optimize the commercial result (hard benefit) without first optimizing the method or system (soft benefit).

 

The fact of the matter is that if we were talking about this in a manufacturing environment then the same COO and CFO would likely have less of a problem with the line between hard and soft.  If I was telling them that if they improve these inputs (process), then they would increase production by 100 widgets per hour (Output or Commercial Result), then they’d likely get our their checkbook and want to know how soon it can be implemented.    Unfortunately, many times people aren’t as willing to make the direct connection with their “People Processes.”    People are variable – some work harder than others, some are smarter, they have bad days, their favorite teams lose the Super Bowl,  their Mother-In-Law just moved in, and the kid gets sick – it’s certainly not as cut and dry as “Input In” and “Widgets Out.”     The problem is that they make up the most significant portion of your Operating Cost so not fully optimizing that investment is just simply Bad Business.    If you’re an executive reading this here are a few ways to determine how optimized your people investment really is:

 

· What % of your company can tell you the Organizations Strategic Goals?   Go to the Water Cooler and ask a few people.   Just for fun, also ask them when is the next company holiday – they’ll probably all know the answer to that question.

· Are you measuring top to bottom performance based on those Strategic Goals?   By the way, that may be hard to do if the people in your organization don’t know the goals (see question #1).

· Do you know who your top performers are across the entire organization?    Do you reward them differently for their contribution?

 

I could go on and on, but the answers to those three questions are a good litmus test for understanding whether your company’s largest investment is being managed wisely.    If it’s not, then you might want to consider investing in a better method to drive commercial result.

In parting, I like to point your attention to the “mother of all processes” – the US Tax Code.   Based on our earlier discussion, the Tax Code in and of itself is merely a process, so improving it would only yield “soft” benefits right?   Forbes Magazine has a blurb discussing the complexity of the process.    In 2008, 500 changes were made to the US Tax code.  The “process” changes to the tune of nearly 1000 words/day being added.    Nowhere is the blurry line between hard and soft benefits more apparent.  The process now consumes 7.6 Billion hours of American’s time per year – the equivalent to 3.6 million jobs.     What’s the result, output, or commercial result?    Well, three of the President’s cabinet appointees have had “tax compliance” issues due to the complexity of the method/system/process.   (By the way, it’s not a political blog, so I’m just giving the benefit of the doubt).  If you’re a business, then you employ teams of people just to navigate through the complexity.   If you’re a regular Joe Q. Public, then you spends hours of your own time and money in order to achieve the optimal commercial result.  Sound familiar?

 

Maybe process does matter after all…

 



Related CTI Applications Articles

Back your Tumblr Blog


Learn how to create a backup of all your tumblr blogs to the hard disk including photos, video, chat sessions and even songs. Unlike WordPress or Blogger, Tumblr does not have an official export feature yet, so moving your Tumblr blog to a different...

Read more about Back your Tumblr Blog...

Ubiquity


I'm writing this post sitting by the pool in Ko Samui, Thailand looking out across the bay where the locals are fishing in a flat sea from small traditional boats - I'm here for a good friend's wedding. Samui is a little island off in the gulf of...

Read more about Ubiquity...

Search Content


Content Categories


WhitePapers


How to Buy a Phone System

Considering a new phone system for your business? The Phone System Buyer's Guide from VoIP-News provides you with all of the information you need to make a more informed decision. The Guide helps you...Read More


Sales Force Automation Comparison Guide

Businesses of all sizes can benefit by automating all aspects of their sales processes with an SFA (Sales Force Automation) solution. But due to the sheer number of features that most SFA solutions...Read More


Which CMS Is Right For Me?

If you're wondering which CMS is the right one for your organization, this comprehensive guide will take you through the various options available, detailing the pros and cons of each. Download...Read More


Oracle Magazine

Oracle Magazine contains technology strategy articles, sample code, tips, Oracle and partner news, how to articles for developers and DBAs, and more. Oracle (NASDAQ: ORCL) is the world's largest...Read More




View All Whitepapers