Advanced Front Office Lean with Business Modeler Software

Lean disciplines may have originated on the shop floor; but, they can also be applied in the front office and this is where the next frontier of productivity gains will take place. Growth in outsourcing and the shortening of product life cycles mean that more and more value is added to a product in the front office. Engineer-to-order and project-centric businesses, in particular, are vulnerable to efficiency drains in the front office, and companies that contract out a significant percentage of their manufacturing processes will also have increased demands placed on administrative functions, making front office lean absolutely critical.

In an earlier article, we dealt with some basic approaches to front-office lean. In this article, we'll focus on one often-overlooked tool for facilitating front-office lean—business modeler software that is tightly integrated with an enterprise application. Business modeler software can help to identify non-value-added steps in a front office process, but by using it to automate processes it can—in and of itself—eliminate non-value added steps.

Hidden waste

There is a hidden waste that many executives do not discuss or may not even know about.

This is the waste that comes from a lack of clarity of what the company's current business processes are, or from poorly—defined or inadequately documented processes. In a front office environment, people in administrative and managerial roles may ask each other, their managers, or even the people who work for them, "how do we open a purchase order?" or "what is our process for an engineering change order?" Conversations like this may take 10 to 15 minutes, and might happen dozens or even hundreds of times a day, depending on the organization. Various people in the organization may have been trained to undertake these processes in a variety of ways, and employees may wind up discussing the relative merits of how a process is currently undertaken and how the same process may have been completed in years past.

Even if you are reasonably efficient in manufacturing, think of how much time you are wasting on interactions like these in the office. Moreover, if processes are not documented clearly, how much time and expense is wasted by training new hires in processes that may not be optimal? The need to train and retrain people because their initial training may not have reflected current processes is one indicator that a company ought to consider business modeler software.

Another indicator that business modeler software could be helpful is a periodic or frequent need to redo front office tasks because managers and employees were trained incorrectly or because there is no established, effective procedure for taking care of business tasks.

If, in the course of conducting business, the following questions are asked with any degree of regularity, business modeler software may be required in order to facilitate leaner operations:

* How do we do this?
* Why do we do it this way?
* Isn't there a better way?
How does business modeling help?

The genius of business modeler software is that it helps to reduce waste throughout your organization in a number of ways. First of all, it standardizes processes and then documents them. The business model then describes how you do things and puts that descriptive data in a common repository. Whether you are filling in for an associate who is away and have to learn a new functional area of the company or are training a new hire, your process information is standardized, accessible, and packaged for easy learning.

Business modeler software also facilitates process change management and improvement because it contains a history of how things have been done in the past and the reasons for adopting new processes over time. This history of the business models as they developed, what was done in the past and why processes were changed will help you avoid wasting time and resources by reverting to a process that you had earlier abandoned because you found them to be suboptimal.

If attempts at process change in your organization prompt comments along the lines of "we tried it that way years ago and it didn't work," business modeler software will certainly help. Only by recording and studying history can you avoid reliving it.

Another powerful aspect of business modeler software is that, if it is properly integrated with the enterprise IT environment, it is not just a training tool or a tool for senior managers; rather, it's a tool for daily use by hands-on system users. People using an enterprise software tool are using a system and therefore need a systematic approach for doing things on that computer system. The model would likely be most useful in the longer term for those who use a system only periodically, and, therefore, do not have the opportunity to rapidly master the system. Ideally, the model is not just for training, but for actual use until the processes contained in the model become second nature. Over time, the model is used less and less to guide workers as they follow processes on a daily basis. This means that when it is part and parcel of the overall enterprise software environment, business modeler software can guide front-office processes ranging from scheduling, materials planning, finance, quality, customer service, and other disciplines in a manner similar to visual cues and other methods used on the shop floor.

Business modeler software can streamline processes wherever there are a number of things to attend to; and by doing them in the proper way in the proper order, workers can reduce non-value-added steps. The fact that these processes are well-documented and centrally archived means that even after processes are learned thoroughly and the model is no longer being used as a daily guide, users can refer to it occasionally as a way to re-orient themselves on key processes.

Employee Training in a Recession

As organizations reassess their staffing levels, many employees are being asked to do more with less. Aside from reducing headcount, many organizations are cutting back on employee-related expenses, even if they can provide long-term benefits. Examples include application training and travel to user groups in which employees can network and exchange best practices. This article discusses the increased importance, benefits, and risks related to employee training in a recession with respect to enterprise systems.

Growing Organization Risks

While understandable and often imperative for the continued survival of an organization, the aforementioned cutbacks promote a vicious cycle of increased organizational risk:

  * Organizations reduce or eliminate formal training and informal opportunities for users to learn how to better utilize enterprise systems.
  * This solidifies many users' bad habits and suboptimal processing methods.
  * At the same time, organizations trim staff, resulting in more work among fewer employees. This means even less time for cross-pollination where employees are trained in multiple jobs.

Organizational risk is compounded if key employees leave the organization and, as is often the case, user documentation is lacking. For example, incumbents may scramble to figure out how Alex ran regular interfaces, Neil matched invoices, Julian filed tax reports with the government, and Nancy created database backups. If Alex, Neil, Julian, and Nancy are no longer with their organizations, then they are, in all likelihood, unable or unwilling to assist their former employers in the event that their help is needed.

Often, the best case scenario is that jobs performed by ex-employees are partially understood by their replacements. Nonetheless, this may very well result in increased risk of error, financial irregularities, expensive engagements with external consultants, or some other highly undesirable outcome. In the extreme, a single employee's departure may result in a missed payroll, an eventual government audit, or security breaches.

Opportunities and Benefits

Organizations with tight budgets may not need to reduce headcount at present. There is a fundamental tension between lean staffing levels and organizational bench strength. Lack of widespread end user application and technical knowledge is dangerous in the event that a key employee decides to walk. Yes, even in these economic times some employees voluntarily leave their jobs for whatever reason.

To this end, organizations should consider expanding employee training, not cutting back. Whether employees are being cross-trained in different functions or learning new technologies altogether, the benefits of training can more than offset their costs. First and foremost, training mitigates the risk of key employee turnover. Second, the mid- or long-term savings of training may more than pay for itself. Two super users with substantial skills and a global perspective may be able to do the work of three or four limited end users, especially if they are skilled in different automation methods. Finally, while hardly tantamount to reassuring nervous employees about their employment futures, training can send a strong message to attendees: the organization wants you to develop your skills. And the message becomes "despite current economic challenges, we are committed to growing our employees' skills and abilities." This attitude may reduce the likelihood of voluntary employee attrition.

Once the organization has decided to move forward with training, it has a fundamental decision to make. Where will the class be held?

Organizations that want to build internal expertise in new applications have two choices: They can either send their employees to public or private training classes. Public classes typically take place at vendors' offices or at vendor-approved locations. These classes cost in the neighborhood of $500 per day per student. Many organizations in different stages of an implementation send users to public classes to learn how their systems work in a generic sense. In other words, a payroll manager should not go to a public class intent on learning how to set up and process payroll at her company, although she should walk away with more than a few ideas from the class. Because payroll personnel from other organizations attend public courses, the instructor will discuss the payroll application in general terms.

For public classes, clients travel to vendor sites, sometimes incurring significant travel costs. To the extent that client end users are out of the office, they should be able to focus exclusively on the class and the applications being taught. From a technical perspective, vendors should have sufficient computer terminals and training data areas. In other words, clients need no organizational IT involvement to attend a public class, nor do they necessarily need to bring laptops with the applications already on them.

Private classes are very different than public ones, both in terms of costs and content. For one, it's not uncommon for a vendor to charge upwards of $3,000 or more per day for a customized class at the client's site, because vendors know that client end users will not have to incur travel costs. Thus, from a strict cost standpoint, a private class with more than six people will probably be cost-effective for the organization. As for content, instructors will typically customize agendas specifically for each client. In a private payroll class, for example, the payroll manager can ask many specific questions related to her company's payroll setup and processing.

While, it may be less expensive for clients to host private classes in which trainers come to them, understand that employees attending private classes are in the office. Crises or emergencies can take them away from the class, reducing overall learning. Also, from a technical perspective, the trainer is not going to bring laptops configured with the software and training data areas. Consequently, the amount of IT involvement is much greater than that of a public class. The organization that brings in an instructor at $3,000 per day should ensure well before trainer's arrival that its hardware and software are "up to snuff". Nothing inhibits a class and frustrates all concerned more than "buggy" software and the lack of a proper training data area. The last thing that a client's management wants from a public class is a disaffected end user base.

Outside of a formal class (whether public or private), independent learning has become more populate. Recent advents such as web-based training (WBT) have become increasingly popular. While the cost savings are obvious and the convenience factor is high, remember that employees at their desks are often distracted by daily calls, e-mails, and old-fashioned door knocking. Consequently, the cost of a public course can sometimes be justified by the additional learning that tends to take place in an isolated environment.

Considerations and Caveats

Training for training's sake is fruitless. Organizations need to ensure that their training investments will result in tangible benefits. Users may learn a robust new technology over the course of a three day class. However, this certainly does not equate to mastering it or deploying it in the organization, even for highly motivated and skilled attendees.