The Winner Is? Data
I am often criticized for wanting to solve problems with software or IT solutions. I jump too quickly to "there's an app for that" for many business challenges. People say to me, "people, process, THEN tools" as most problems can be solved by either adding people or changing the process. Part of the challenge of Industry 4.0 is that solving problems with technology does not differentiate itself from people and process. Why spend the money on tech when you can just change the process?
The simple answer to this is data. Using apps to manage business processes creates electronic data that can be used for other things. Here are a few examples of how electronic data capture can be used:
1) Measuring the process effectiveness. For every key business process, an effectiveness metric or metrics should be created. Two go-to metrics are cycle time and quality. How long does it take to complete the process? Can you measure the value add & non-value add time? Even better. Measuring the quality of a process is done by looking at First Pass Yield (FPY) of the process steps. Are there parts of the process that require rework? Is there an escalation process for work that is not moving? Creating metrics becomes much easier when the data is captured in a system.
2) Reducing the time it takes to put out fires. Have you had to explain quickly to a customer or a manager about an issue? How much time was spent sifting through email and talking to people just to put the story together? It seems like Friday afternoons are notorious for having to face the fires. When the story and the data is contained in an application, these fires can be extinguished quickly. Then Friday afternoons can be spent relaxing or meeting with colleagues for happy hour.
3) Improving processes. One of my favorite activities in business is to perform a Kaizen event on a business process. In a conference room, the team maps out the business process, identifies waste and creates an improvement plan. Data is not required, if you have the right people in the room. However, data makes it easier and clarifies uncertainty. Data exposes hidden wastes such as exception processes, rework and dwell times. The data can be used to prioritize the action plan, too by quantifying the benefit of the improvements.
4) Monetizing. Netflix figured this out in its beginning. Have you seen the show "House of Cards?" It's success is attributed to data and machine learning. Through the data, Netflix discovered that it would be a big hit and placed a big bet on it. 86% of viewers were less likely to cancel their subscription because of that show. That is an amazing churn statistic. Here's a link to the article: https://www.idginsiderpro.com/article/3207670/how-netflix-built-a-house-of-cards-with-big-data.html
Seeing the value in applications to manage processes requires a data oriented culture. Creating a culture that is data oriented is not easy and hands-on leadership is key. When organizations delegate the data gathering to individual contributors, the wrong message is sent. The leader needs to be active with the data to change the culture. For more suggestions on how to become a data oriented company, send us a message on our chatbot or an email. We'd love to chat on it further.