Welcome to the December 2009 edition of Strategic Innovation newsletter, a free monthly newsletter on leadership, strategy and innovation. Delivered on the first Tuesday of each month.

Back issues are archived for free downloading at www.DanielLockConsulting.com.

Tips for improving business processes

• Waste occurs when activities exist because the process is inadequately designed or the process is not functioning as designed; activities not required by the customer or the process and activity that could be eliminated without affecting the output to the customer.
• Instability occurs as organisations grow, processes break down and are patch for use, and become excessive complex.
• Errors occur when additional controls are put in place to review outputs rather than change the process.
• Communicationbreakdown exaserbates failure when individuals in the process fail totalk to their customers and understand their requirements.
• Too much time is spent on internal maintenance activities such as coordinating, expatiating, record-keeping instead of on redesigning theprocess.

The year that was...

As we approach the end of 2009, and perhaps the end of GFC, I am full of introspection for the year that was.

I am amazed at the winds of life and how much they rock the boat and force us to adjust course. This year the winds were especially strong.

In the first half of the year, reading a newspaper, if you dared, was enough to have even the most optimistic wondering is the world wasgoing to hell in a hand basket. Yet, here we are. This to shall pass.

Confidence is what drives economies, and it is returning in spades. The market is looking very bright indeed for the year ahead. And if you out look outover the next 5 years we will all be living at a higher standard than we are even now.

That doesn’t mean we wont have any hiccups along the way, the recent Dubai debacle last week is a good example. But we have all learnt valuable lessons about debt, decision-making, uncertainty and risk., which we can take with us into the new year and next business cycle.

So we turn to my recommendations for the year ahead:

Continue any efficiency and lean programs. Keep the tight focus on rapid response (taking customer out of the market), and speeding up the cash flow cycle.

Create Buffers. Use the new cash from these improved process, and cash released fromlean programs to build some cash buffers. As previously stated there will continue to be surprises from left field (the one thing we cancount on in life.)

Manage the buffers. In your projects, work to the buffer. That is measure thebuffer penetration. This is a far better measure of progress.

Focus on marketing and customer service. Use the same tools for process improvement, to find none cashimprovements in marketing and customer service. There are two types of competition we don’t like: foreign and domestic. So build the mote around your competitive advantage that is your castle every day. This doesn’t cost much, if any thing at all. It does require leadership and perseverance.

Invest in your people. Again look for the non-cash processes, and simple investments inrelationship building that will build loyalty. Good employees will bein huge demand as the markets heat up.

It seems to me, that the markets may have over reacted on the down side inthe face of extreme uncertainty and risk, and as the confidence comes back into the market, the recovery will likely be rapid, and possiblyover shoot on the up side.

 And then wash, rinse, repeat.

It’s been a pleasure writing these monthly articles to you. Thanks for the readership and the feedback. I look forward to another 12 months of articles and cheerful 2010. Enjoy the holidays.
 

Technique of the month: Kanban for the knowledge worker

Kanban is a lean tool used to reduce inventory, which was developed out of theToyota Production System. The main idea behind kanban is to reduce the amount of work in progress, which thereby speeds up the whole production lead time of the system.

Kanban applies to knowledge and service workers just as in manufacturing.

Here are some tips on how to have kanban work for to speed up work, or just release some pressure leading up to Christmas.

1. Inventory all projects, and current to do items on one list.
2. Prioritise the items using a triage system, high medium and low priority. Thebasic priority method to use is dollars and days. Or dollar-days. (As they say: time is money.)
3. Now schedule and work on the top priority work only. Then medium, and drop the bottom third.
4. Allow no new work ‘in’ until something is completed.

You will find that just making the work visible will make a huge breakthrough in reducing overwhelm and make it much easier to delegate. And that by reducing the bottom third and allowing no new work in thatyou will get through almost all your work with ease.