The Profit Killer – Unnecessary Process Variation
Posted on April 26, 2018 in Business Process Improvement ,Industry Discussion
by Julia Baillie
By Brad Malone
Brad Malone, MA, PMP
I’ve had the privilege of being an intern under Dr. W. Edwards Deming (I wonder how many readers know the significance of that name without “Googling” it), a Malcolm Baldrige National Quality Award Regional Auditor (same interest as above), and a Certified Quality Auditor via the American Society for Quality. How have these experiences and certifications contributed to my understanding of the AV integration, Live Event and other Systems Contractors business models?
They prove that any human or mechanical action (or process) which is repeatable can be documented, standardized, measured and improved upon – if the people involved are so inclined and deem it important enough. Here is a greatly-condensed summary of 100 years of process-oriented study that can be applied to our industry. There are eight elements which make up a process, each of which must be defined and its variance measured:
- Time. How much time (e.g.; 8 – 10 minutes) does it take to perform the function and build the deliverable to its intended quality standard? How much variance occurs naturally (2 minutes) and what is the primary cause of that variance?
- Machine. What are the machines and tools necessary to build the deliverable? Are all of these in working order? Are they the right machines or tools? Are they all available to the people performing the process? Are they all used the same way? Are they well maintained and put back where they belong when the process is completed.
- Methods. How do people conduct their work in building the deliverables? What are the procedures being used? Are all of the procedures being followed by all of the people? Are there redundant or unnecessary steps? Are there steps in place to fix something already completed upstream?
- Materials. What are the raw materials to be used in building the deliverable? Are the same materials used for similar deliverables or are there various materials (e.g.; mounts) used based on Sales person preference? Do the selection of materials cause variance in the process? Who orders them? When? Based on what criteria?
- Energy.How much physical or mental energy is required to build the deliverable? If it is a complicated deliverable, how much uninterrupted mindshare is required by the person involved? Have we made the steps difficult to remember or overly physically taxing?
- Measurement. How are we measuring Quality? Progress? Adherence to the process? Are we measuring the truth or a number? What behaviors do the metrics cause in the employees (make 10 customer calls per hour vs. make between 8 – 12 calls per hour and describe the variance)? Do the metrics behaviors help / hinder building the deliverable? Remember – what gets measured (or doesn’t) gets done (or doesn’t).
- Personnel. People are an integral piece of the process – but they are only one piece. Are they trained and competent in the methods? Do they know the standard they are building to? Are they being measured appropriately? Are their appropriate consequences for their competence and/or behavior?
- Environment.This is the culture of the company – its vision, mission, values and ethics – is it healthy or is it toxic? It is also the physical space. Is it conducive to building the deliverable? Are there obstacles in the way, too much noise, not enough light, temperature variations, safety issues, etc.?
The goal with all of the above elements is to measure variance and waste (i.e., redo). When you find it – look to remove it – waste is a profit killer.
Waste is a profit killer
Waste isn’t intentional – getting rid of it has to be – the people involved in the process have to own the change – and be actively supported by those who own the company.
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