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Saturday | 22 November, 2008
CIO
Taking a Systems View
Too many organizations are measuring the new with the old. A growing number of experts say the management methods of the manufacturing age are outdated and need to be replaced by metrics that measure the value of the intangible assets that make up organizational capital
Sue Bushell 07 February, 2007 14:15:18

In a paper for the Wide Eyes Open Web site called "Business Productivity: Maximizing the productivity of business systems, processes and structure", Sweeney offers the following ideas on ways to clean up the chaos.

1. Identify the repetitive issues

What issues keep recurring frequently? What problems constantly pop up? Ask your team to help you write a list of these. It may take a week or two to compile so you can see the patterns emerging. These repetitive issues are the symptoms of what is not working in the business.

2. Identify the "black spots"

Black spots are the underlying cause of the issues you are experiencing. You need to do some root cause analysis, which is basically a long-winded way of saying you need to ask why. For instance, if phone calls are not being answered in a timely manner, start asking "Why".

• Why wasn't the phone answered in three rings? Because Jan was down the hallway.

• Why was Jan down the hallway? Because she needed to take a file to Jim.

• Why did Jan need to take the file to Jim? Because he can't access it on his computer.

• Why can't Jim access it on his computer? Because he doesn't have security permissions.

Once you do this analysis on a number of the "symptoms" some common underlying causes start to emerge. These are the black spots.

3. Validate the black spots with staff

Once you have completed your analysis, check back with your staff to ensure you have identified the right black spots. Get their feedback and refine accordingly. Beware that your own viewpoint of the situation may be influencing the causes that you see. You lack objectivity. If the opinion of staff is different from your own, do not dismiss their ideas; find other ways of validating each viewpoint to determine which one is the most effective.

4. Do an ROI analysis

Some black spots are going to be worth fixing, others are not. Look at the business case for each major change that is planned. Does it make good business sense? Prioritize those projects that provide the better return on investment.

5. Document and feedback

Document the changes that are planned and how those changes will be implemented. It is critical that you get the team's input again at this stage. You need their support and buy-in or the change process will be ineffective.

6. Communicate, communicate, communicate

It is almost impossible to over-communicate with your team during the change process. Be strategic with your communication. Highlight and emphasize progress, the small steps as well as the big wins. Congratulate and reward. Do not gripe or publicly comment on people's shortfalls. Keep everyone in the loop, ask for feedback and celebrate success.

SIDEBAR: Going Global

Ken Standfield, chairman of the International Intangible Management Standards Institute, is currently seeking expressions of interest from individuals, institutes, journalists/reporters, vendors, thought leaders, consultants, Fortune 500, Global 2000, government departments and others to participate in the Global Cost to Value Taskforce, which he says is seeking to create world-first solutions to five of the most significant global accounting and management challenges that managers, executives and organizations face.

1. New methods to cut costs and risks whilst boosting productivity and sustainability: the difference between good costs, bad costs, true ROI and false ROI.

2. Financially valuing strategic initiatives: articulating and financially valuing true benefits and true costs.

3. Productivity valuation and reporting: tracking and measuring value creation, realization and potential.

4. From metrics to financial valuations: doubling leadership effectiveness.

5. Sales and marketing: doubling B2B sales effectiveness.

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