Category Archives: Value Stream

A VALUE STREAM is an end-to-end business process which delivers a product or service to a customer or consumer. The process steps along the way may both use and produce intermediate goods, services and information to reach that primary end.

Analysis may suggest the removal of intermediate process steps, goods, services and information that do not move the value stream forwards to its primary end, provided they do not serve important secondary ends such as compliance, quality control or employee loyalty.

VALUE STREAM MAPPING is a lean manufacturing technique used to analyze the flow of materials and information currently required to bring a product or service to a consumer.

RFPs – A structured process

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A “Request For Proposal” is the issue of an invitation for suppliers to submit a proposal on specific goods or services. The RFP process brings structure to the procurement decision and allows the risks and benefits to be identified clearly upfront.

Searches on the web will also show a number of opinions that are against the use of RFPs.  It seem that these opinions have come about due to a lack of correct process – RFPs being used in a scatter gun fashion soliciting responses from random suppliers.

RFPs are a structured document and should only be sent to suppliers that are already interested in providing a “proposal” to supply goods or services at an agreed quality, schedule and price.

The major benefit of the RFP (if done properly) is that it ensures all potential suppliers receive exactly the same information to base their costs and performance on, no single supplier or group of suppliers receives preferential treatment – accidental or otherwise.

Plus, if the format of the responses has been specified, comparison of the submissions can made easier, quicker and directly. In fact, if actual historical data (desensitised) has been used throughout, it will not only allow comparison of potential suppliers but also allow current costs to be used as a benchmark.

Even so, it is critical RFPs are accurate, clear and concise.  Shortcuts, errors or omissions will impact on the final selection, exactly as if an RFP had not been used at all – and a wrong decision can be very costly.

 

Contact me if you’d like to know more.
Mark

Good Procedures – a business requirement.

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Procedures can be formal or informal, simple or complex but whichever you use they are there to minimise the guesswork and irregularity in the business.  The format of which should be standard throughout the company as far as possible (there are many templates on the web to build from), they should also be effective and efficient! I have worked with companies that are overburdened with procedures and those that literally rely on the information and experience of individuals.

Overburdensome procedures take away the ability to move quickly, to adapt to change before competitors.  This scenario is usually found in larger organisations (& Government) and colloquially called “bureaucracy”.

Whereas a lack of documented procedures can often facilitate a faster response, the problem that lies herein is that the improvements and changes are again not documented.  Thus there is confusion over the “correct” procedure to follow.  Plus, as is often the case without procedures, results and KPIs are not accurate and may even be guesses, if they are presented at all.

Either way, change is required with benefits found in both scenarios. Redesigning procedures can be seen as being easier due to the fact that they have already been written and only need “tweaking”, while in other situations documenting procedures from scratch can also be seen as being easier as there is a clean slate to work with.

The issue here is often not the need to redesign or design procedures; it is the perception of change. There are companies that state they are looking for change, to make the improvements they know they need to take their company to the next level. I just wonder how many people have found a company’s statements on change are not always congruent with their actions.

Some companies I have worked with see change as part of their business, continual improvement itself being a process that happens everyday. These are the companies that have realised change can bring a level of uncertainty or a period of moving backwards before improvement (but careful planning and testing will reduce any negative effect).  Yet there are others that talk about change but can only manage partial implementation, sometimes abandoning improvements that have been made. I have found there is also a correlation to particular industries as well.

I would welcome comments on companies that have good procedures and how they design/change them.

Next instalment – Failure to change