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Intelligent Performance Management: Processes Spanning the Organisation

Intelligent Performance Management: Processes Spanning the Organisation

September 29th, 2020

Ernest Hemingway said, “Never mistake motion for action.” I am personally enamoured with this quote. The message is a powerful one, and one that is delivered so succinctly, with little wonder when you consider the source. I felt that this was the perfect message to start this episode of the series as it reflects both the reality and purpose of the ‘process’ perfectly. To grasp how it does this we must start with the basics: the definition of the word ‘process’.

So, what does process mean?

According to Merriam-Webster (along with a silly number of other sources) there are a variety of different definitions for the word process. I won’t go into all of them, as that is not strictly relevant, but I will pull a few quotes from their website:

“…something going on…”

“…gradual changes that lead towards a particular result…”

“…a series of actions or operations conducing to an end…”

Breaking this down, along with the various other definitions you can find, we can clearly see that a process is something that requires some sort of movement, change, or travel towards a specific target. It is a conscious set of actions to achieve a desired result. Applying this to your business, it is not a far stretch to see that we are talking about a targeted pathway towards a specific business objective.

While this is not the ground-breaking revelation you were perhaps hoping for, this is a critical starting point for discussing the third pillar in our Intelligent Performance Management framework: Process Spanning the Organisation.

Let’s jump into your business and make a few general assumptions. Let’s assume that within your business you have a strategy broken down into various KPIs and goals which will help provide direction for your business. These are distributed into the various departments, with respective business processes to take you from A to Z in achieving each one (or more) of those goals. Now take a second to stop and think about your organisation. You may find that your business processes within these various departments are siloed, don’t take you towards your objectives in a targeted way, or maybe you don’t have a reliable record of the processes in your business at all.

This is not surprising. In our experience, we find that business processes are generally built as a result of a specific driver at a specific moment of significant change (often a technology shift, or M&A activity). Considering that many organisations invest per business unit area to patch and maintain, operating on a technology platform that has been modified for a decade to fit their ever-changing needs, this key driver of procedural change falls by the wayside.

The consequence of this is an evolved collection of sub-optimal processes that will achieve their specific goal but may ultimately cause high levels of ineffectiveness and structural stress on the organisation itself. A recent study supporting this found that an average of 26% of a working day is lost to ineffective ways of working and needlessly manual processes, which is a staggering level of waste when you consider the ruthlessness of the modern business word.

This is why the quote from Ernest Hemingway resonates so much when describing business processes in the context of IPM. There is constant motion in your organisation, but the combination of legacy systems and patchwork changes means this motion does not always equal meaningful and effective action.

Where do we go from here?

Looking back over the last decade, we have seen that the top performing organisations are the organisations that have broken down internal barriers and leverage data from every aspect of their business to generate meaningful and actionable insights from the core of their businesses. This means that finance does not sit in a procedural bubble, but as a pillar of the core business. The role of the finance function is extending and evolving into a finance-focused strategic business driver, collaborating with all to deliver value as well as reports. As described above, this requires a solid technology platform and data solution, but to truly benefit from this you also need to change your ways of working.

Sure, if you don’t change the way you’re working you can still gain some business process benefits from the technology. How many hours are saved by removing the need for manual data handling and input? How many hours are saved by not having to pull data from multiple disparate sources to build graphs for analysis?

"The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.”

– Bill Gates

A recent study – in which organisations were questioned about their use of automation in the finance function – has found that 87% will see a direct increase in efficiency, and 52% will see immediate financial savings, plus cash savings as the time is re-invested in more value-adding activities. It is possible to build automation & robotics to work with your existing systems, but if you decide to ‘automate the mess’ you still have the mess, it is just temporarily and marginally quicker. This may only buy you an extra couple of years, but it will ultimately leave you with a greater mess than today. Plus, it leaves you stuck when you want further solutions or something scalable; still needing to replace those pesky legacy systems.

If you really want to maximise the positive impact to your business, you need to revise your ways of working in line with your new technology platform and strategic direction, viewing your core business from a collaborative value driver perspective. Now is the time to put internal function politics to bed and embrace a formal collaborative and cross-functional model.

Technology is a great enabler of this. All the tools within a platform talk to one another without the need for custom-built bridges, widgets, and APIs. To quote a well-known consumer tech company, “It just works”. Further to this; analytics, machine learning, and artificial intelligence are simply not possible without deep integration of big-data, systems, tools, and a staggering level of processing power. Something that is best done on a cloud platform.

Once you have your technology foundation in place, spend time to map and re-evaluate all of your business processes. Map from the top down, with the direct line of sight to your strategy, and you will rapidly find areas of ineffectiveness and waste. Redesign how your people interact with one another and how they interact with the technology platform, and you will rapidly find areas where your people are able to dramatically increase their positive impact on the business. Procedural bottlenecks and redundant process loops will be a thing of the past.

By doing this you are giving yourselves the best chance of converting the maximum amount of motion into action.

 

To level-up your organisation and realise the value from your investment you need a holistic plan covering technology, data, processes, and people. In fact, your company-wide strategy must be revisited to ensure the successful execution of the changes you will be making. It is not an easy fix, and certainly not a quick fix, but it is a change that needs to be made to ensure your organisation is fit for the future.

At inlumi we have identified the 4 key pillars of Intelligent Performance Management that need to be addressed for you to enable the Insight Engine and achieve the best results possible for your organisation. Processes spanning the organisation is only one of these areas.

Over the coming weeks and months we will explore each one of the 4 pillars of The Insight Engine in further detail right here at inlumi.com; through a combination of articles, webinars, and Q&A sessions. If this resonates with you, why not get in touch and we can explore together how your organisation can benefit from Intelligent Performance Management thinking?


About the author

Tim Edmonds

Tim Edmonds
Senior Advisory Consultant
tim.edmonds@inlumi.com

Tim joined inlumi in 2019 as a Senior EPM Advisory Consultant, with previous experiences as a Strategy Operations & Services Director and Strategy Execution Consultant. He currently has 7 years’ experience turning vision into action by combining futurism with strategy and process design, leadership, and goal setting; spread over the TMT, FMCG, Automotive & Transportation, and Banking sectors.