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We’ve Had It All Wrong: Manage Processes, Not People
WebinarNovember 1, 2012
Founder: Karen Martin & Associates, LLC (1993).
Consultant / Coach: Lead Lean transformations in office, service and knowledge environments.
Teacher: University of California, San Diego’s Lean Enterprise program.
Author:Karen Martin,
Principal
July 2012 Just released!
Last Webinar of 2012!Metrics-Based Process Mapping:
What, When & How
Thursday, November 2911:00 am – 12:15 pm Pacific Time
To register: www.ksmartin.com/webinars3
© 2012 Karen Martin & Associates, LLC
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We have THREE BIG
PROBLEMS.
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Problem
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Most businesses aren’t performing as well as
they could and need to.
Common Organizational Woes(cause and effect can be debated)
• Unclear vision; inability to focus• Slim margins• Unrealistic pricing• Unhappy customers• Flat or eroding market share• Slow innovation• Poor quality• Unfulfilled workforce
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Problem
2010 Accenture StudySuccess with Improvement Approaches
0%
10%
20%
30%
40%
50%
60%
70%
80%
Minimal financial impact
Needs re‐evaluation, restart or complete
makeover
“Mixed” to “disappointing”
results
33%
58%
69%
9© 2012 Karen Martin & Associates, LLC
Up to 98,000 deathsannually due to medicalerrors.
Goal: Reduce by 50% in 5 years.
To Err is HumanInstitute of Medicine, 1999
10© 2012 Karen Martin & Associates, LLC
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Something Is Terribly Wrong…
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2009
2005 2010
2010
2011
Progress has been slow.
Journal of the American Medical Association
Annual death toll from medical
errors is closer to 200,000.
Dead by MistakeHeart Newspapers Special Report
180,000 Medicare patients die annually from medical errors.Office of the Inspector
General
No significant change in rate of
preventable errors.New England Journal of
Medicine
33% hospitalized patients are harmed; 7% result in permanent
injury or death.Health Affairs
© 2012 Karen Martin & Associates, LLC
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Problem
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Widespread Disengagement
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You had them at “You’re Hired.”
Workers have been robbed of…
• Trust• Respect• Knowledge, skills, aptitude, creativity, experience (KSACE)
• The ability to maintain healthy interpersonal relationships
The Result…• Whining• Finger‐pointing• Interpersonal tension• Inter‐divisional and/or inter‐departmental tension
• Turnover• Blatant infighting• Sabotage• Physical and mental illness• Social consequences
– physical, sexual, substance abuse; poor parenting; divorce
Poorly designed processes are typically behind interpersonal & interdepartmental
tension―not personalities.
Forming New Habits:
Organizational response to
problems moves from blaming people
to improving processes.
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You create (or fail to create) high-performing employees in
the way your organization operates and treats its people.
— The Outstanding Organization, p. 154
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The Countermeasure…
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Toyota’s Overarching Tenets
• Continuous Improvement.
• Respect for people.– Safety and quality of life.– Authorized to solve
problems.– Well-designed systems
and processes.
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How do we get the people to do the process the way it
should be done?
For example, how can you invoke what seems to be a simple process of labeling samples at the bedside?
Common Management Practices• Processes not standardized nor documented.• Processes not designed by the experts–the people doing the work.
• Processes not measured against operational targets.• Process workers don’t receive adequate training.• Reactive improvement and problem‐solving.• Blame – invoking the 5 Who’s instead of the 5 Why’s• Telling people what to do.• Silo’d behavior; lack of holistic thinking.• Misaligned incentives.• Poor problem solving capabilities.
– Process improvements don’t address the true root cause of the problem that drove the need for improvement.
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Process Owner ≈ Process Doctor
Process Owner
• Manager or below• Responsible for overall process performance
– Tracks performance against targets– Leads corrective action when negative trends
appear– Leads continuous improvement to progressively
raise the bar• Granted authority to cross org chart
“boundaries”– And widely recognized to possess this authority
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Activity PT LT %C&A Activity PT LT %C&A Activity PT LT %C&A Activity PT LT
Approve PO 15 240 100% Fax PO to Account Manager 5 20 100%
Notify customer when they can expect delivery
15 300 95%
Review and approve PO; send
to Order Entry 5 240 100%
Enter order into SAP 10 240
Step # ? 986
Finance / Credit
Function / Department
LT UnitsHours Worked per Day
37,500Paul Dampier
Occurrences per Year
Current State Metrics-Based Process Map
26-Nov-078
Sam Parks
Date Mapped Michael Prichard
Order FulfillmentProcess NameSpecific Conditions Domestic orders through sales force
PT Units Process Details
Mary TownsendSean MichaelsRyan AustinDianne O'Shea
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Mapping Team
Order Entry
Account Manager
Sales Rep
Customer
Seconds
Minutes
Hours
Days
Seconds
Minutes
Hours
Days
Processes Owners Lead Improvement & Problem Solving ACROSS ALL FUNCTIONS
CEO
COO
VP
Dir Dir
Dir
VP
Dir Dir
CIO
VP VP
Dir
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Process Owners Have the Responsibility & Authority to Lead Improvement Across
Artificial Functional Boundaries
The Next Frontier…
30The Middle Manager
How to Turn the Tide1. Face the truth.
– Processes remain poorly managed.– People are being beaten up for no good reason.
2. Document ALL major processes.– Improve upfront if time allows
3. Define 3-5 key performance indicators for each.
4. Identify a process owner.5. Socialize the role and responsibilities of the
process owner.6. Begin managing the process.7. NEVER STOP.
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Keys to Outstanding Process Management
• Relevant key performance indicators• Metrics-based value stream and process-level
maps.• Cross-functional improvement.• Exceptional socialization (address WHY) and
training on improved process.• Continuous monitoring/measurement.• Continuous improvement.• NEVER STOP. Process don’t manage themselves.
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Watch as poor performers begin to soar and poor
performance turns exceptional.
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Karen Martin, Principal7770 Regents Road #635
San Diego, CA 92122858.677.6799
[email protected]: @karenmartinopex
For Further Questions
Monthly newsletter: www.ksmartin.com/subscribewww.ksmartin.com/the‐outstanding‐organization
www.ksmartin.com/files/webinarmaterials/11-01-2012_handout.pdf
_slides.pdf
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