Many organizations that we consult with have introduced, or are in the process of introducing, process improvement approaches to the way they operate. While we don’t consult on this type of work, we’ve found that our approach to Optimizing Organization Design® provides a framework that both strengthens and protects process improvement in three valuable ways.
The first value of our approach is determining the levels of positions that will be necessary for a given process. While most process improvement occurs at the first level of an organization (which we would call Stratum 1), some process improvement requires more complex (Stratum 2) positions. For example, in Insurance, auto repairs can usually be set up in a Stratum 1 process that is quite proceduralized. However, this is usually not the case for serious bodily injury. This requires positions with greater diagnostic capability that can be set up at a Stratum 2 level. If an organization doesn’t understand and identify this difference in position requirements, the processes that are being created will ultimately fail. This same issue is repeated in terms of positions that manage these processes. Again, there is a fundamental difference in complexity between being the manager of a Stratum 1 process and being the manager of a Stratum 2 process.
The second value of our approach is with the clarity of accountabilities and authorities that it provides. Our approach has a taxonomy of accountabilities and authorities, both for employees and managers, and also for cross functional relationships. When we look at process improvement, we often find that accountabilities are not clear. Even more serious, we find that there has been little work on the authorities that should be matched with the accountabilities. One of the biggest issues is the managerial accountability for the for the ongoing management and improvement of the process is often not addressed. Process improvement is often seen as a discrete project, and once the project is over, there is nothing else to do. This perspective significantly reduces the ongoing value and sustainability of process improvement.
However, there is a more serious problem. Processes go across functions in an organization, and cross functional accountabilities and authorities are required, yet seldom exist. Most organizations complain that there are silos, and work across the organization is not well done. Some think that setting up stronger processes is the answer. It is not. It simply exchanges some of the functional silos for process silos. In both cases, cross functional accountabilities and authorities are necessary, but are seldom in place.
The third value of our approach is matching people to positions. Our approach can measure three factors. The first is skilled knowledge (knowledge, technical skill and social process or people skills). The second is application, fully applying oneself to the requirements of a position. The third, which is unique to this approach, is information processing capability. The requirements for Stratum 1 procedural positions, Stratum 2 diagnostic positions, and Stratum 2 or Stratum 3 managerial positions are different. Not getting these matches right can lead to process improvement failures.
Next time you’re looking at your own organization’s process improvement efforts, ask yourself if your organization is designed in a way that you’ll be able to achieve the maximum benefit. If you’re interested in knowing more about our Optimizing Organization Design® approach, or specifically the interaction between our approach and process improvement, please don’t hesitate to contact us.