Lack of efficiency and effectiveness in an organization can have a significant impact on the overall cost of operation.
Organizational Velocity - Improving Speed, Efficiency & Effectiveness of Business provides a framework for diagnosing, assessing and implementing to improve the speed at which the organization operates.
There are two main areas for focus:
1. Process Audits - a framework for assessing key processes within the different functions of the organization and detailing where improvements are to be had
2. Workload Analysis - based on a workforce survey to identity where and what time in the organization is spent doing, including the efficiency and effectiveness of Meetings
The outcome from using the PPT framework will be a prioritised list of initiatives for implementation to increase organizational speed and reduce the cost of operation.
2. ORGANIZATIONAL VELOICTY
A faster organisation is normally a better organisation
Advantages
+ Money sooner
+ Anticipate competitors
+ Exceed customers expectations
+ Do more
+ Create new opportunities
Reactive speed
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+ Increase efficiency
Proactive speed
Cautions
― Rushing with no information
― Executing poorly
― Not waiting for situation to evolve
― Pushing too hard
1
3. CONTENTS
Contents
Page
Organizational Velocity
1
Improving your Speed, Efficiency & Effectiveness
4
• Process Audits
9
• Worked Example
20
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•
33
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• Benchmarking
Becoming Faster – The Management Challenge
41
43
2
4. IMPROVING YOUR SPEED, EFFICIENCY & EFFECTIVENESS
Process Recommendations Dashboard contains a ‘menu’ of prioritised
process improvement opportunities
Process Recommendations ‘Dashboard’
BBFTB1
Process
1
2
Implement
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Yes
No
Yes
No
Yes
Yes
No
No
Yes
•
Quick win
Implement
No
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Yes
No
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Yes
No
Yes
No
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3
Yes
No
Yes
No
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• …
Yes
No
Yes
No
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5
6
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Yes
Yes
No
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Yes
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No
Yes
No
Yes
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No
Yes
Yes
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Yes
No
Yes
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Yes
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Yes
Yes
No
No
Notes: (1) ‘Big Bang For The Buck’ Opportunities
3
5. IMPROVING YOUR SPEED, EFFICIENCY & EFFECTIVENESS
Financial benefits are often be derived from the Process Audits and General
Observations
Benefits ‘Dashboard’
Benchmarking
164
5
General
Observations
EXAMPLE OUTPUT
• BBFTB Opportunities
― Efficiency gains: ~ $x.xm (~x FTEs)
― Specific effectiveness gain of ~$x.xM for
‘Order to Cash’ process
― Additional significant effectiveness
opportunities (sized as Low/Medium/High
only)
17
• Quick Wins:
― Efficiency gains: ~$x.xM
― Additional effectiveness opportunities (sized
as Low/Medium/High only)
Process
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Audits (inc.
• General Observations
review of best
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66
― Efficiency gains
practise for
each process)
131
4
30
32
Total Potential
Opportunities Observed
Focus
Opportunities
General
BBFTB
Process
Quick Wins
Process
BBFTBs
(~x FTEs)
― Significant effectiveness opportunities (sized
as Low/Medium/High only)
Total Impact of opportunities
― Efficiency gains: $x.xM
― Specific effectiveness gains:
~$x.xM (Order to Cash)
― Additional significant
effectiveness opportunities
4
6. PROCESS AUDITS
A Process Audit consists of six steps
Process Audit Steps Summary
1 Process Value Chain Overview
2 Description of Main Activities
3 Process Audit Results
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4 Improvement Opportunities
5 Prioritisation of Opportunities
6 ‘BBFTB’ Opportunity 1 Pagers
5
7. PROCESS AUDITS
Step 2 involves interviewing the Process Owner (and team) to detail
each step of the process, describe it and who is involved etc
Step
2
1. Detail each sequential step of
the process (through interview
with Process Owner & Team)
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2. Complete more
detail for each
step
…
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•
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•
…
•
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•
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Description
When?
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•
…
•
…
•
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•
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•
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Who?
How long?
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8. PROCESS AUDITS
The efficiency and effectiveness of each process is rated according to
the extent of improvement potential…
Step
Rating Criteria
High level of improvement possible
3
• Each process is
rated for each of the
10 audit questions
across efficiency
and effectiveness
Moderate level of the full possible
• ‘Worst’ rating across
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questions
No action required
overall rating for
that process for
each of efficiency &
effectiveness
7
9. PROCESS AUDITS
Step 5 - Each opportunity is then ranked by both value and ease of
implementation against set criteria
Rating Criteria for Improvement Opportunities
Step
5
Ease of implementation
Easy
• Easy implementation without major investment, limited effort, no risk and no global
guideline restrictions
Moderate
• Implementation with some financial investment, medium implementation effort, some risks
and/or some global guideline restrictions
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Difficult implementation with major financial investment, significant implementation download
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Value of opportunity
High
• Frees up a large amount of time or resources to “do more” and/or increases the quality of
the outcome (effectiveness) to a very high degree
Medium
• Frees up a significant amount of time of resources to “do more” and/or increases the
quality of the outcome (effectiveness) significantly
Low
• Frees some but limited time of resources to “do more” and/or increases the quality of the
outcome (effectiveness)
8
10. PROCESS AUDITS
Step 6 is to produce a one page description for each opportunity,
redesigning the process
Step
BBFTB Opportunities
Description of Opportunity
• …
Description of Benefit
• …
6
Estimated Value
• …
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Recommended Next Steps
• …
Risks / Considerations
• …
Investment Required
• …
9
11. CONTENTS
Contents
Page
Organizational Velocity
1
Improving your Speed, Efficiency & Effectiveness
4
• Process Audits
9
• Worked Example
20
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view Analysis
•
33
please goto: www.straticx.com/store.html
• Benchmarking
Becoming Faster – The Management Challenge
40
42
10
12. PROCESS AUDITS
The value chain for Strategic Planning identifies six key process stages
EXAMPLE
Strategic Planning
Create roadmap/
revise last year's
roadmap
Define issues and
opportunities
Process Owner
Define detailed
strategies (brands,
departments, etc)
Review detailed
strategy and
combine to
corporate strategy
Preparation of
presentation deck
Presentation and
discussion of
strategy Leadership
Team
J. Smith
• Strategic roadmap from
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previous year
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Input
• Market, competitor, product
Output
• Strategic
analysis
• Global strategy framework
Process customer
(internal, external)
Leadership Team
Process frequency
Annual
Involved parties
(internal, external)
MD, CFO, Leadership Team
Main IT-systems,
-tools
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13. PROCESS AUDITS
The efficiency audit highlights lack of alignment of activities and the
lead time it too long
Priority Process Audit: Efficiency
EXAMPLE
Efficiency Questions
Efficiency
A
Is there a need to completely
redesign the process?
• No
B
Are any steps in the
process unnecessary?
• No
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C
• Yes
Are the steps in the right sequence?
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D Are there large efficiency opportunities
within any of the steps?
• Lack of alignment in guidance provided, driving different activities
E
• Needs wider involvement to achieve objectives
• Limited visibility of actual workload leading into strategy planning
F
Are too many people involved in the
process? (Decision matrix)
Does the process take too long?
• Total lead time is too long for the strategic planning process
•
Condensed and precise process (clear perimeter, input/output, etc); best practice time frame: 4 weeks
•
Ability to drive out of the box thinking (challenge status quo). Strategy should be built outside in (not just based on where the business is
at today)
Shared understanding and buy-in from BU
•
12
14. PROCESS AUDITS
There are three key improvement opportunities
EXAMPLE
Improvement Opportunities
Efficiency
1.
1 Reorder the activities of strategy planning process
Effectiveness
2.
2 Driving strategy understanding down in the organisation
3.
3 Stimulate “out of the box” thinking
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13
15. PROCESS AUDITS
BBFTB #1 is to redesign the strategic planning process
BBFTB OPPORTUNITY # S.P.1
Description of Opportunity
• Redesign the strategic planning
process with shorter timeline and 2step approach
EXAMPLE
Description of Benefit
• The shorter timeline provides the
opportunity to focus the planning effort
during a specific period of time and
base the strategic plan on the most
current information
Estimated Value
• $100k
10% less rework due to most current
information and 2-step approach
(strategy alignment)
• Do the strategic planning of supporting
functions in the second step improves
the alignment with the commercial
strategy
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Recommended Next Steps
Risks / Considerations
Investment
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• Review proposed process and timeline
• Implement new process for the next
strategic planning process
• Clear communication of deliverables
as needed in order to perform on the
compressed timeline
• None, just communicate new process
and design templates/ guidelines
• Be aware of other activity during this
time:
―
Year-end closing
―
Submission of annual budget
14
16. PROCESS AUDITS
Driving strategy understanding down in the organisation
BBFTB Opportunity # S.P.2
Description of Opportunity
• Improve the communication of the
strategic roadmap and the department
roadmaps
EXAMPLE
Description of Benefit
• Improved understanding of company
goals and improved decision making
on lower levels of the organisation
Estimated Value
• Medium, especially better decision
making and higher engagement of total
organisation
• Everyone in the organisation needs an
understanding of how their work and
outcome relates to the strategic goals
and priorities
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Recommended Next Steps
Risks / Considerations
Investment
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• Implement communication concept
• Management must be able to
“translate” strategic goals to individual
workplace
• Low, time of management
15
17. PROCESS AUDITS
…and to the overall recommendations
Process Recommendations ‘Dashboard’
Process
1. Strategic Planning
2
BBFTB
EXAMPLE
Implement
S.P.1 Redesign strategic planning
Yes
No
S.P.2 Communicate strategy
Yes
No
•
Yes
Yes
No
No
Yes
Quick win
Implement
No
…
S.P.3 Stimulate out of the box thinking
Yes
No
•
Yes
No
…
Yes
No
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3
Yes
No
Yes
No
…
• …
Yes
No
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No
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5
6
•
…
•
…
•
…
Yes
Yes
No
No
Yes
4
No
Yes
No
Yes
No
No
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•
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•
…
No
Yes
Yes
•
Yes
No
Yes
No
Yes
No
Yes
Yes
No
No
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18. WORKLOAD ANALYSIS
In parallel to the ‘process audit’ work, a workload analysis will drive a
clear understanding of how the organization spends its time
Key Workload Analysis Activities
Workload Analysis
Meeting &
Project
Snapshot
Workload
Survey
• Survey the team to evaluate:
─ which processes employees
are working on
─ what activities they are
undertaking to get things
done
─ the autonomy of their role
─ general recommendations
and comments on whether
there is additional capacity in
the business to ‘do more’
• Completed by key people in
each department
• Identifies key recurring meetings
and standalone projects/
workstreams
Meeting Quality
Observations
• Attended and evaluated key
meetings
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Objective
Measure and observe whether the organisation is running very ‘tight’
or whether there is room to capture efficiencies
17
19. WORKLOAD ANALYSIS
Importantly, a workload survey provides an assessment of the
willingness of the organisation to speed things up and get more done
EXAMPLE
Workload Survey Findings
“Do you believe there is additional
capacity within the office to ‘do
more’?”
Comments from Respondents
• “Using our tools correctly would save time to create time”
[10%]
• “We need to change our effectiveness and speed in decision
making and be more risk taking versus need to validate and
research everything versus making business decisions based
on experience and judgement” [40%]
No 45%
55% Yes
• “Our plant is at about 70%, another at about 65%, one at
about 80% and the last one at about 50-60%”
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• “Everyone is busy and at capacity but not necessarily on the
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right things” [0%]
• Average of an additional 14% capacity by
those employees that said “Yes”
• The suggested additional capacity ranged
between 5% (7 respondents) and 40% (3
respondents)
• “We are already doing too much. We need to do less and
focus on doing things properly instead of always rushing from
one thing to another” [0%]
• “In our dept we are fully busy so logical answer is "no" but we
all find time for special projects/emergencies so the
organisation does have some flex but suspect it is not
sustainable the way we do it - we should plan it better and as a
business agree things that won't be done in the future - that reprioritising could mean a better use of capacity rather than a
more capacity”
18
20. WORKLOAD ANALYSIS
..as well as a perspective on the ‘activities’ people are undertaking on a
day to day basis
EXAMPLE
Time versus Employee Costs Spent for Key Work Activities
Other (Training etc)
Managing people
3%
8%
Communicating externally
8%
Communicating internally
11%
2%
11%
6%
11%
21%
24%
Desk Work
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Meeting Related
46%
48%
Time Spent
Represents ~$20m in
people cost.
A 10% improvement in
meeting efficiency
across the board
would release ~$2.0m
in resource
Employee Cost
19
21. WORKLOAD ANALYSIS
An audit of meeting quality will give an insight to the companies
‘meeting culture’
EXAMPLE
Meeting Audit Heat Map
Meeting
4
5
6
7
8
9
1
3
2
5
3
2
2
1
1
Pre-reading available
5
5
5
5
1
3
4
5
5
Pre-reading read
2
3
3
2
N/A
2
2
2
2
5
5
5
5
5
5
5
5
5
Length
3
4
2
3
1
2
4
3
3
Frequency
5
5
5
5
1
5
5
5
5
Decisions taken
Yes
No
No
No
Yes
Yes
Yes
Yes
Yes
Other - information
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
5
3
5
5
5
5
5
5
5
Right info
1
2
3
3
1
4
3
3
5
Format
2
2
3
3
N/A
4
5
3
5
Minutes/ Actions
Clear objective
3
Behavior
Time
2
On time
Hygiene
1
5
5
N/A
2
5
2
5
2
2
Follow up
N/A
N/A
N/A
N/A
Yes
Yes
Yes
Yes
Yes
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Right people?
3
3
3
1
5
4
4
5
Participants
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Yes
Yes
Yes
Yes
Yes
No
Yes
No
No
please
Clear Agenda
Document
information
quality
Follow ups
For a better understanding of how to increase meeting efficient and effectiveness see STRATICX
document “Complete Toolkit for Improving Meetings”
5 = Very Good; 1 = Very Poor
20
22. BENCHMARKING
Whilst benchmarking needs to be contextualized, it can help identify
improvement opportunities or areas of focus
Benchmarking
EXAMPLE
Total FTES per HR FTE
Marketing Spend/Net Revenue
#
$
#
$
#
$
$
?
?
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Benchmark Benchmark Benchmark Benchmark
1
2
3
4
Our Co.
Benchmark Benchmark Benchmark Benchmark
1
2
3
4
Our Co.
21
23. BECOMING FASTER – THE MANAGEMENT CHALLENGE
Ultimately, the speed of an organisation is strongly influenced by its
leadership, and their ability to inform culture and key processes
Becoming Faster – The Organizational Challenge
Priorities
Lack of Speed
Set, review
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a of Speed
Resources
Calibrate, give
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Will
Lack of Speed
Inform, incent, monitor, fine tune, excel
22
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23