Each year, APQC carries out a survey to understand the common challenges and priorities of process and performance management (PPM) practitioners. This year’s survey, conducted in December 2022, included 160 valid participants representing a diverse range of industries like services (14 percent of respondents), software/technology (14 percent), and government/military organizations (9 percent).
We found that this year’s top three focus areas for PPM are:
- process management (91 percent of respondents),
- continuous improvement (82 percent), and
- data and measurement (70 percent).
As we peel back the layers to look at specific challenges within these focus areas, we’ll also examine some of the strategies that APQC has seen leading organizations carry out to meet these challenges.
TOP PROCESS MANAGEMENT CHALLENGES
- defining and mapping end-to-end processes (34 percent of respondents);
- moving from a function-based to a process-thinking culture (29 percent); and
- improving the maturity level of process management practices (28 percent).
Defining and mapping end-to-end processes has been the top process management challenge for the past five years now, and the reasons why make sense. Many organizations are looking to break down silos and collaborate across the value chain, both to take advantage of new technologies designed for end-to-end processes and to drive greater customer centricity.
Function-based thinking makes it easy to connect with others within the same function, but it also tends to reinforce silos and finger pointing when things go wrong. Process thinking organizations, by contrast, look across the value chain to conceptualize groups of activities as processes and seek to understand how all of an organization’s processes work together to produce products, services, and profits from inputs.
TOP CONTINUOUS IMPROVEMENT CHALLENGES
- creating a continuous improvement culture (52 percent of respondents);
- creating a systematic approach to identify improvement opportunities (43 percent); and
- aligning continuous improvement efforts across the organization (47 percent).
These challenges are fundamentally related to the process management challenges above. For example, without a mature, systematic approach to identifying improvement opportunities, process work can easily devolve into random acts of improvement that do not align with enterprise strategy and that only make a limited impact.
A continuous improvement culture helps ensure that:
- each employee knows the role they play in identifying and driving improvements;
- teams are coordinating their efforts across the enterprise; and
- improvements are aligned as parts of an ecosystem that collectively drives enterprise value.
This culture requires a process thinking mindset and prioritizes cross-functional collaboration over functional thinking and silos.
MOVING THE NEEDLE ON PROCESS MANAGEMENT AND PROCESS IMPROVEMENT CHALLENGES
To address challenges like the ones above, it is critical to:
- Prioritize end-to-end process work. Focus your efforts on the end-to-end interventions that will drive the most value based on your business priorities and strategy. Even if it means working within lower-level processes at first, make sure your efforts aim at concrete business and organizational outcomes.
- Collaborate to identify and prioritize improvements. Cross-functional collaboration is critical to avoid duplicative efforts and ensure that improvements in one area do not impact upstream or downstream processes elsewhere.
- Leverage process assessments to chart a course toward maturity. Leverage tools and resources like APQC’s Seven Tenets of Process Management℠ Maturity Model as a guidepost to understand your current-state processes and the steps you can take to grow more sophisticated and mature in your approach.
TOP DATA AND MEASUREMENT CHALLENGES
- establishing a culture of data-driven decision-making (35 percent of respondents);
- ensuring performance measures are relevant to their purpose (28 percent); and
- aggregating analysis into a dashboard to support decision making (25 percent).
Data and measurement are critical not only for benchmarking and identifying improvement opportunities, but also for holding leaders and managers accountable for helping to drive change. Data-driven cultures of decision-making leverage data and measures for all of these objectives and more, but establishing this type of culture is a challenge for many organizations.
Ensuring that performance measures are relevant to the purpose—the second top challenge in this focus area—is at least a part of what makes establishing a data-driven culture so challenging. Without the right measures, leaders, teams, process owners, and other stakeholders will find it difficult if not impossible to gauge progress and track trends over time.
Addressing Data and Management Challenges
Many organizations struggle with challenges related to their data and measures. To address challenges like these, leading organizations:
- Focus on data that matters. APQC recommends engaging with the business to find out which measures decision makers find to be important. These typically include business performance measures like revenue, costs, customer retention, or cycle time.
- Align data and process visualizations. Look beyond basic dashboards and process measures to think about how you can leverage process data to help identify improvement opportunities or red flags that need to be addressed. For example, when carried out effectively, process mining can be a powerful tool in this regard.
- Connect action to outcomes. Use measures and data to assess your progress against viable business objectives. Along with providing better decision-making support, well-aligned data and measures provide evidence to executives and other stakeholders that there is a strong value proposition to your work.
LOOKING AHEAD
End-to-end collaboration is the name of the game for PPM in 2023. Create opportunities for cross-functional teams to come together, identify value-added improvement projects, and prioritize the projects that align with your business goals and strategies. Collaboration and engagement for process work across the enterprise will help steer your organization away from siloed ways of thinking about process and toward a process thinking culture that keeps a watchful eye on the entire value chain.
See the full survey results for more information and insight on PPM priorities and challenges in 2023.