Improving monitoring of your business process – when and why to do it

In this article you’ll find:

• under which circumstances should you increase the granularity of monitoring of your business process
• how does it connect to Business Process Improvement
• how IT solutions are related to business process monitoring

In each and every company there’s a thing which we can call a core business process. Visualize plucking things off your company from the least important to the most important ones. There is a point where the whole business would stop working at all. This minimal amount of structure required for the company to work is the core business process. Companies that can balance their structure near the required minimum have better margin than companies that do not. 

It’s a kind of minimalistic approach that culturally is associated with Japan. It’s there, where three concepts came into being. Mura, muri and muda. Codified as a part of Toyota Production System, today these are part of many management theories including Lean Management. Ideas presented there are used not only on university faculties, but also in the production industry.

Muda – is wasting resources.  It’s any occurrence of using resources that doesn’t add business value. Overproduction of parts that we do not use, transporting them where these aren’t needed, time spent waiting for the resources to be collected, these are the examples of what doesn’t contribute value.

Muri – is a word commonly used by the Japanese. They say it to convey the meaning similar to the phrases “no way!” or “cannot do”. In business context it means overtime, exerting oneself, unrealistic production goals. People working on a production line often are perfectly aware where such situations happen. It depends on the organizational culture whether these voices are heard or suppressed.

Mura – is unreliable variance in production. One day we produce ten complete items daily, the other day only two. It’s often hard to discover the underlying causes for such unreliability. The knowledge is distributed between employees and what is needed is to gather information from all of them and try to understand the system in order to determine possible causes and their solutions.

In practise, these three types of waste intermingle with each other. When Black Friday or Christmas hangs around the corner it means hectic time for a custom overprinting service. A stressor (mura) is introduced. There is more and more work. Muri (pressure) looms over the whole production team. People are only people, they err under pressure. Following muri there is muda (lost orders). Resource waste accumulates in different parts of the factory. There’s no time to look for them. All hands on board. As much as possible needs to be delivered now. The time to count losses will be later.

Nonetheless, such stress factors like Black Friday are a great opportunity to test out how resilient our company is and what is our capability for scaling production in the right moment – when we still are more lean to implement changes in our ways of work. Problems that aren’t visible on a daily basis under pressure become much more pronounced.

When we become aware of such a problem, there are many methods of Business Process Improvement to tell us what to do. A lot of them are a variation of the Deming Cycle – Plan, Do, Study, Act. If we’re to improve our processes, then in the Plan phase we should determine what beneficial effect should it result in and if that’s possible, describe some measurable metric to be able to study in the Study phase of the experiment.

And here it’s important to consider if we are able to make, store and analyse these measurements. It is possible that we do not have sufficient faculty to do that. If we only track the order placement date and then shipping date, the most we can do is calculate the derivative indicator – the number of days in production, which will give us awareness of the problem, but doesn’t yet point us in the right direction, where are the real bottlenecks in the process.

It’s an area where technological solutions can be useful. Even a rudimentary barcode scanning to track the history of a particular order will divide the production process into a set of intermediary steps. That helps us not only to look where to focus our attention, but can also be repurposed to find the lost orders in the factory and finish them before our clients start asking where the delivery is and why it didn’t arrive on time. Which is important in the B2B business where the ability to deliver on time is connected to the reputation of the company.

Of course, like with all technology solutions, let’s be reasonable with it. When investing in measuring and monitoring tools, we need to compare expected outcomes with costs of such undertaking. Return on this investment could result from cost optimization of the business process or from increased production capability following the change. If our business process has been improving for years now there’s a possibility of small marginal utility of adding new measuring tools. However, in such a situation our company probably already gathers a lot of data, which is a good starting point for trying machine learning / artificial intelligence solutions.

One needs to be aware that digital transformation alone won’t change people, their needs and habits in order to work better. But it can give us a foundation for better decision making and incremental optimization of the business process and organizational culture.

In conclusion, IT technology solutions can improve monitoring of our core business process. On a daily basis (or under stress conditions) this insight helps us better understand the de facto production system of a company and allows informed decision making. With such knowledge our core business process can be improved faster (or start being improved at all). Business Process Improvement should be done with deliberation in mind and all investments in IT should be compared to expected business outcome from implementing these changes.