When Process Re-engineering goes wrong
Process re-engineering is often done by a small group of experts. This approach seems obvious to many companies since they want to implement best practice processes. The problem is that most of the good thinking stays with the expert, in the instruction documents, tools or systems. The process re-engineering does not reach employees and it does not impact the organisation’s real behaviour. There is an alternative way by using a process re-engineering tool that both contribute to a strong business process, make process re-engineering happen and to ensure a strong sense of ownership in the organisation. This post will explain how.
Four years ago a large European production company set up a corporate “Sales Excellence Department”. The purpose of this was to respond to changes in the market that required new skills in selling solutions rather than products.
The department invested significant resources in a process re-engineering tool to develop a number of new business processes. They also had consultants write detailed Role & Responsibility documents, instructional guides and communication materials. Then they trained selected sales representatives from all national markets.
The Excellence Team Ended up Destroying Value
Most of the steps they took during the process re-engineering were just by the book. However, the result today is that the ambition of “excellence” has been reduced to a daily struggle about getting the sales reps to add their sales opportunities to the CRM system. Only a fraction of the original ideas has resulted in a behavioural change in the company.
So, the question is: What went wrong? Senior management set up the excellence department since they realised a need to standardise the business processes across the company. The sales reps, on the other hand, felt pressured to accept the solution to a problem they didn’t think they had. The approach was driven by CRM system needs, rather than the needs of the sale reps. The end result has been that the sales reps have not accepted the new approach. The transformation has not happened.
Is There an Alternative Path to Excellence?
Senior management has clearly seen the company as a machine. A machine needs fine-tuning by experts in order to run well. The problem is that companies are not machines. According to Peter Senge companies are closer to being living organisms (see our blog post “Is Your Company a Machine or an Organism“.) Companies consist of people who each of them feel that they know best. They want to be heard and they want to be involved. This is why “fine-tuning” companies is very difficult. It is more about directing and supporting people so they can find alternative paths.
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If the senior management team had this fundamental view of a company, then they would have used a process re-engineering tool that started with the employees that were supposed to change behaviours in order to sell solutions rather than products. Then they would be able to succeed in process re-engineering. In my opinion, this build on two success factors:
1. To start with a business process that represents the current, accepted way of working with the sales reps, and
2. To involve the sales reps in changing this.
Start With the Current Way of Working
A good saying within the field of process re-engineering is that “you can’t drive the wagon faster than the horses can run.” This is why the implementation of new business processes initially is about removing unnecessary weight and the tendency to take detours (to stay within the analogy). It means making it as easy as possible to transition from an old way of working to a new.
In this case, the opposite happened. The new way of working became highly advanced and complex after six months in the hands of a full-time team of corporate experts and consultants. The local sales reps used to sell in their own ways. There was no common process. Then they were introduced to an advanced, best-practice solution sales process that consisted of a range of subprocesses in multiple levels. Hundreds of pages of instructions and guides were sent to help them.
Process Re-engineering needs to be simple
Complexity steals the individual’s resources both mentally and in terms of time lost. It is therefore highly important that the first version of a common process is very simple when process re-engineering is being made. More steps should only be added when the simple process is used correctly by the majority of the employees that are working with it. A multilevel sales process will only add complexity to the lives of sales reps who have trouble even placing their opportunities correctly in a simple sales pipeline.
So, in my opinion, the first challenge is to ensure that everyone understands the relationship between the work they know and do every day and the abstract representation of it in the form of a business process. This understanding is often assumed to be there but it is only reached through a process re-engineering tool that includes co-creation of the new process. The only daily experience of gaps between own. practical work and the abstract presentation of it can create this understanding.
Large Scale Involvement Ensures Large Scale Ownership
Involvement is crucial for ownership. A psychological experiment that has been repeated in many countries supports this (e.g. Ellen Langer, 1975). Two groups of people were asked to pick lottery tickets. One group selected their numbers randomly and the other group picked their preferred numbers. Just before the lottery draw the researchers offered to buy back the lottery tickets from the two groups. The outcome was that the group that had picked their preferred numbers demanded a price that on average was five times higher than the group that had selected randomly. The point is that involvement has to happen on an individual level if it is to translate into a sense of ownership.
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The Path to Excellence is Iterative
Large-scale involvement and ownership require the ability to support ongoing collaboration on the process by the people that work with it. The case company could have chosen a process re-engineering tool with a more iterative path that combined process work and change management:
1. Map your current, as-is process as a hypothesis of how work is done. A team of salespeople from different countries can map this in a single workshop (possibly aided by a facilitator.)
2. Communicate this to a small group. The process hypothesis is presented to a group of selected salespeople with an invitation to try it out in practice and provide feedback on an ongoing basis. It is important to do this via a process community tool, so the work can happen across time and space.
3. Try it out in practice. The group will then try out the process during a period of 3-4 months (depending on cycle time). Each employee completes his tasks and activities in accordance with the process. Questions, concerns and answers are shared online and related to each step in the process. This helps capture feedback in the right context.
4. Adjust the process. An improvement team of the most engaged and knowledgeable people (as defined by participation in the first steps) then gathers physically or virtually and created a new process version.
5. Try in more countries. The new version is communicated again. This time people from more countries are included.
6. … and so the cycle is repeated.
The company could have completed 8-10 of these process improvement cycles during the four years that have passed. Instead, they have been waiting for the “hockey stick effect.” Experts could still have challenged the sales reps during the process. Skills and guides could have been developed along the way – based on actual demand.
The result could have been a process re-engineering that had been developed alongside the company’s capabilities through an active improvement culture that was based on broad involvement from the people that were transitioning. The main assumptions would have been a higher degree of trust and a digital process community that would enable this large-scale involvement.
If you’re looking to get started on improving your business with process management. Why not check out our guide to process hierarchies? It’s a great way to start!
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Frequently Asked Questions
Process re-engineering in a company involves several vital steps. Firstly, the company should perform an extensive analysis to understand its existing processes completely. This is followed by the identification of areas that necessitate changes or improvements. The next phase involves brainstorming and creating innovative ways to bring about the needed changes while increasing efficiency and productivity. Once these new methods are designed, they must be implemented, followed by in-depth monitoring to ensure they achieve the desired results.
Yes, process re-engineering can be applied to businesses of all sizes. It doesn’t matter whether the organization is large-scale or small-scale; any business can benefit from re-evaluating and re-designing their processes. Properly executed process re-engineering can lead to greater efficiency, reduced costs, and improved customer satisfaction, regardless of the company’s size.
There are several common challenges that companies may come across during their process re-engineering journey. These include resistance to change from employees, lack of clarity about goals and objectives, and problems while transitioning from existing processes to the newly designed ones. To effectively address these issues, companies must maintain open communication channels with their employees, make sure the objectives and benefits of the process re-engineering are made clear to everyone, and provide ample resources for adequate training and assistance.
