How to Increase your Organisation's Capability

by Stephen
(New Zealand)

How to increase your organisation's capability without increasing resources

Your staff are working overtime, financial pressures are rising and everywhere you look you see queues for equipment.
In short, your organisation's capability to meet demand is being stretched to breaking point. The common response is to ask for more resources: financial, human, capital. But adding more resources to a system that is already running at full capacity will not fix the reasons for the overload. The only way to do that is to start at the beginning...

How Lean intervention increases capability

A lean intervention concentrates on operations, the means by which your organisation creates value for your customers. A lean intervention will uncover:

Purpose: Purpose is the reason the organisation exists, from your customer's point of view. Purpose is an expression of the value your organisation creates for your customers.

Measurement: Measures are needed to see how you are performing in terms of the purpose. Measures that do not relate to purpose distract resources from creating value for your customers.

Method: Method is the way you do the work to satisfy the purpose, your business processes. The effectiveness of method will be seen in your measures. If you are not meeting your measures, you make changes to your methods, you don't add new measures...

Where do you start?

Demand. If your business is transactional, and most are, everything starts with demand. The first step of a lean intervention is to analyse demand and measure your organisation's capability of meeting that demand. But not all demand is created equal.

There is value demand, demand that creates value for your customer. And there is failure demand, demand that results from the failure of your organisation to do something, or do something right, for your customer.

Both create work for your employees but only value demand creates value for your customers. Failure demand eats up capacity, increases costs and demoralises staff.

Value demand is a request for a new service or product, something your customer wants from you. Failure demand is following-up on an overdue order, or lodging a complaint, something your customer has to do because you've failed him.
The purpose of a lean intervention is to eradicate failure demand from the system.

What's better, to eliminate the reasons for the complaint or to have an efficient complaints process?

How Lean Intervention differs from Process Improvement

Lean intervention seeks to eradicate failure demand, freeing-up capacity to deal with value demand.

Process improvement seeks to remove waste from processes, whether the process creates value for the customer, or not. True, you will remove waste and become more efficient. But some of your efficient processes will still be non-essential, non value creating from your customer's point of view, and will continue to consume valuable capacity.

A Process Improvement Consultant treats all demand equally and removes process waste, indiscriminately.

A Lean Practitioner analyses transactional demand and helps you act to eradicate failure demand, increasing your organisation's capability without increasing resources. Then removes process waste as needed.

A Process Improvement Consultant will introduce a change management programme.

A Lean Practitioner makes change safe.

(inspired by www.systemsthinking.co.uk)