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Time to Re-Th!nk Improvement

by Hal on June 15, 2009

in books, design, project planning, systems

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So much of our attention in the lean community is on continuous improvement. Normally that is interpreted as "process improvement". In the project world processes are often incidental to the work we are doing to fulfill the promise of the project. In other words, the value stream goes through a series of tasks like writing software code, documenting a feature, refactoring, etc., none of which follow a repeatable step-by-step process. Architecture and construction projects are similar. The process stuff is supporting the value stream. When we make so-called improvements to process we are dealing with "the how" some outcome is accomplished. Rarely are improvements focused on "the what" of the outcome. Ric Merrifield tells us to shift from the how to the what to get innovation and to really cut costs.

Shift from "the how" to "the what" to boost innovation and to really cut costs.Ric's book, RETHINK: A Business Manifesto for Cutting Costs and Boosting Innovation, does a good job of getting our attention off the how and onto the what. He offers story after story of companies that stay clear about what makes them distinctive to their customers. While the process for delivering on results is always important, getting the outcome right makes or breaks our projects. My colleagues and clients have heard me say over and over Don't improve on something that we shouldn't be doing in the first place. Ric says it more forcefully,

Never has there been a more important time to continually improve your company's efficiency and productivity. (F)or that to happen, they are going to have to avoid the "how" trap, rethink and focus on their "whats," and become a collection of plug-and-play operations.

Ric has been thinking about this stuff for awhile. A year ago he and co-authors Jack Calhoun and Dennis Stevens published a paper in HBR, The Next Revolution in Productivity. In the paper they describe the five steps: (you can substitute the word "project" for "company")

  1. Describe your operations in terms of desired outcomes (the whats)
  2. Identify the activities supporting the desired outcomes
  3. Identify the capabilities supporting each of your activities
  4. Identify activities most critical to your company's success
  5. Design a more efficient operating model

RETHINK takes the fine HBR paper and wraps it in one engaging story after another. I particularly enjoyed reading another take on Alcoa's turnaround in the early '90s. (Steven Spear writes about Alcoa in Chasing the Rabbit.) CEO Paul O'Neil put a singular focus on safety as an outcome (a what). Not only did safety rapidly improve, but it drove improvements throughout the business. Ric shares this kind of re-thinking throughout the book.

The idea of starting any improvement effort by looking at the purpose of the process is certainly not a new idea, nor is it new in the project setting. The Lean Construction community has been pull planning projects by starting with the big outcome promised to the customer and then working backwards to define the series of outcomes that allows the team to keep that promise. We call those outcomes conditions of satisfaction…just another way of saying "what".

RETHINK takes the fine HBR paper and wraps it in one engaging story after another.One last comment, I enjoyed the playfulness in the jacket title. Perhaps it's my imagination but I detect a little Microsoft vs. IBM humor. For the last 80 years, IBM's motto or value, as they say, has been "THINK". The book jacket shows the title as "re-th!nk". Ric has been a Microsoftie for the last 10 years. Can it be just a coincidence? Nah.

{ 3 comments… read them below or add one }

1 James Torres July 14, 2009 at 6:27 pm

In order for big business to get a handle on the cost and status of large projects (especially software projects) they need to focus on project tracking, not project management.

With project tracking you keep track of key milestones, all cost, project revisions and you can do it for all projects for a business. This is especially vital for projects being executed in different locations.

Trying to control projects at the project management level and than trying to summarize is the problem. The company should have an automated tracking system and projects should conform to that.

Jim

2 Andy December 17, 2009 at 11:17 am

I suppose it’s all about clearly defining what you want to acheive upfront

Also, the point about project tracking is well made and it’s interesting how things like benefits tracking are missed / forgotten – the benefits are the whole reason for starting the project in the first place!

3 Jennifer April 15, 2010 at 5:39 am

This is the second time in 2 days that I have come across this book- RETHINK: A Business Manifesto for Cutting Costs and Boosting Innovation. Most large companies can perform multiple functions, are active in more than one line of business, and operate in multiple countries. For many companies, such complexity leads to serious internal conflicts, slow decision making, duplication of costs, and a silo mentality. For all the attention given to crafting a smart strategy, most organizations lag far behind in the ability to execute strategies. Bringing about alignment and coordination in complex organizations is one of the most important challenges facing managers today.

The IMD OWP 2010 will present the central principles of managing complex organizations and then guide managers to apply these principles to their own companies.

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