Tag Archive: systems thinking

Forget Data Cleanup and Find a Measure to Start NOW!

January 17th, 2017

Are you mired in data cleanup and not focused on measures that can immediately help you? Stop searching for the “right” data lever and look for measures to track and improve processes.

If you have the systems to measure your ideal metric, go for it but don’t let it become an excuse! Find one that will measure progress and start immediately!

For example, in one of our clients, not only were the run rates incorrect but they were wildly different for similar items which would make planning an utter nightmare!  However, there are still ways to measure progress and plan. Find a metric that won’t change and stick to it. In this case, we used earned standard hours, and we are able to measure improvements in the metric. Of course, as data is cleaned up, we should put better metrics in place but it doesn’t have to hold up progress! And we were able to plan to the expected earned standard hours as well. All is solved to an 80/20 standpoint which is all that is needed.

This type of scenario has come up on multiple occasions – actually almost every client has some sort of situation that fits in this mold (the only question is how significant). It could be that measuring inventory levels is challenging because the system reports aren’t set up correctly. In this case, it could be that you count pallet rows or something else that is visible and easy. It could be that your system doesn’t support run rates effectively (unfortunately that was true with one client). In this case, we found a manual process to keep the load visible while storing information in the system.

What is in common in all these examples is to start immediately with what you have and find a way to make progress. It certainly doesn’t sound like rocket science but it drives results. If it was common, so many of our clients wouldn’t make significant progress once we find the “right lever” to pull, similar to these situations.

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The Systems View

January 2nd, 2014
Interconnected dynamic business systems

Do the systems in your business work together like the interconnected dynamic systems they are?

I was collaborating on a book on the topic of increasing the value of your business with a colleague yesterday, and we both latched on to the systems thinking view.

We agreed it is “the” way to look at a business. What is a business other than a set of interconnected dynamic systems?

To give you a flavor of these systems, I thought I’d list several to spur thinking.  Stay tuned for workshops, assessment tools, and our book on increasing the value of your business.

1. Financial – Every company has financial systems.  P&Ls, balance sheets, cash flow statements, key performance metrics, and more.

2. Operational – How does your company operate?  Does it produce products?  Provide services?  Service repairs?  There are countless operational processes we could discuss.

3. People – Do you have employees?  How do you hold your employees accountable?  What reward and recognition systems do you have in place?

4. Strategy – Do you have a strategy?  If not, does that mean you are flying blind?  How does your strategy fit with your day-to-day operations?

5. Metrics – How do you track progress?  Do you know if you are improving or declining?

6. Planning – How do you translate your strategy into plans?  Do you have goals and objectives?  Is there a continuous feedback loop?

And the list goes on. I would be remiss if I didn’t mention that there are countless more.  The key is how to put all these together successfully.

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