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Performance and Maturity: Are You Measuring What You’re Trying to Manage?

 

Anyone who has spent any time in entry-level business classes knows the adage, “if you don’t measure it, you can’t manage it.” It’s a pretty wise adage, and from a very systematic perspective, it’s right. Without knowledge of process performance, attempting to change is akin to rearranging furniture in the dark. Sure, you can move things about, but when the lights come on and people start walking thru the room will the changes be valuable or just a mixed up mess?

The performance and maturity tenet pulls process measurement and maturity up out of the depths of management science and puts it in the hands of leaders where it belongs. It’s equally or perhaps more important than process improvement in terms of value to the organization, aiding both strong management and control of our processes and identification and selection of prioritized improvement opportunities.

So what does “performance and maturity” mean? From our perspective, it means measuring the cost, cycle time, productivity, and efficiency of the components of your process model. It also means monitoring and controlling the process, and applying “in the flow” changes. “In the flow” changes are changes made by the individuals and systems running the processes. These “in the flow” changes tweak and tune how we perform the processes to get stronger, more consistent results. They are typically not as involved or costly as process changes. In the flow changes are basically shifting resources to achieve the proper cost mix, or adding resources to achieve the target service level agreements. Along with using process measures “in the flow”, you can also use them to manage the business. You benchmark. You use them in annual planning purposes. You begin to look at your business in different ways, for example as your customer would.

Consider this simple situation: you may form an opinion about a vendor through three main events: when you order something, when you receive something, and when you pay for something. That’s your frame of reference for the vendor. Do you think that the vendor is measuring their business according to your frame of reference? Are they taking the sum of the average cycle times for order management, order fulfillment, and accounts receivable and using that data to drive changes in how they serve you? Probably not. But they should be. Customers see first-hand how well or poorly processes work. And that’s just one simple example.

Having these measurements is important. Understanding what to do with them, or even if you should be doing something with them is even more important. That’s where maturity comes in. If the example vendor was mature, it would be taking process measures for its customer facing processes and using them in strategic planning processes. It’d be prioritizing and driving change across the organization. It would be making sure that the targets set for the process were met as specified by senior leadership. But how does your organization become mature in its process capability? By selecting and using a process maturity model to guide the journey to strong process management within your organization.

Use of a maturity model and conducting maturity assessments is an effective way to assess your current state process capabilities – how well you govern, align, define, manage and improve processes across your organization, and the skills of your people to work within the processes. With that understanding, you can then identify more mature capabilities you aspire to at higher levels in the model and develop strategies and plans to achieve them. Maturity assessment helps you build a roadmap to the future based on where you are starting and what is important along the way. Subsequent reassessments measure progress toward maturity goals and course correct as needed.

Most organizations are stuck trying to reduce the cost or cycle time of processes independent of the others, and wondering why performance suffers and their customers are dissatisfied. The least mature organizations out there aren’t measuring process performance at all, and therefore are reactive to customer complaints rather than objective indications of performance. That’s a costly and seldom correct exercise. Mature organizations are aware of their process capabilities and are actively seeking ways to improve their processes. They’re not just making minor “in the flow” changes, they’re looking at the big picture and making “out of the flow” changes when the time is right.

Is your organization moving in the right direction? Without a sense of where you want to go and the right measures of progress, how can you tell?