Will your airplane fly?

Recently, on a flight from the USA to Europe, I enjoyed a meal while watching a movie. The ambient temp was around 72F. Very comfortable.

... And then I considered that less than a foot away from me, on the other side of the window, the temperature was -50F and the air was rushing past at 500 mph! I'm sure that I would not have been able to enjoy my dinner and movie in those conditions.

This Airbus 330 in which I was flying was designed to take people long distances at high altitudes. A single engine Piper Pawnee certainly would not have done this job. But then again, I would not expect the A330 to do a great job of crop-dusting!

The design of these aircraft had taken external factors into account.

How well do businesses take external factors into account?

When you consider that most small businesses do not survive 5 years, the environment in which they operate is as deadly for them as it is for a human outside a plane traveling at 500mph at a hieght of 36,000ft.

Many businesses look outside of their four walls with rose-colored glasses. Seeing the opportunities and planning how to exploit these. This is not a bad thing (in fact, it is essential). However, in our desire to see the positives we often miss the external threats to our survival and do not take the measures to counteract these.

External threats include competitive activity, changing market/consumer patterns, and advances in technology. Your people with valuable skills could also be lost to competitors. The business model that worked when you were operating out of your basement, will not work when you have 200 people working for you. How have you aligned your people, systems, technologies, processes and policies to adapt to these external factors?

How will you ensure that your plane does not break up when you climb to an altitude of 36,000 ft?

Three Phases of Continuous Business Improvement

Our responsibility is to do what we can, learn what we can, improve the solutions, and pass them on.

Richard Feynman

US educator & physicist (1918 - 1988)

After an improvement has been made to a business - through a system implementation/ enhancement and/or a process change - many companies struggle to keep the momentum going to drive continuous improvement. In my recent publication in Techlinks about driving business benefit from an ERP implementation, I outlined the 3 phases of Continuous Business Improvement. Below, I have adapted these for process changes as they relate to Organizational Change.

Phase 1: Adopt
After the change, most teams focus on supporting and/or rolling out the changes with little or no attention to the formalization of these changes. The objectives of the Adopt Phase are:
• The establishment of effective leadership/ ownership of the new process/ system.
• Making changes part of the day-to-day business process.
• Clearly documented new processes and procedures.

This will result in business ownership of the changes. This ownership is a key requirement if you want to ensure that improvement is not a once off event.

Phase 2: Sustain
Once the initial improvements have been made, you can put process controls in place to ensure that you don't go back to they way you were before. In fact, process control is part of and Six Sigma implementation. However, it is just as improtant to get the organizational side of this equation right too. Thus the objectives of the Sustain Phase are:
• The establishment of end user competency programs.
• Process support and capability.
• The retention of employees with portable business process skills.

This phase must result in a competent resource base and a formal process for managing issues and defects.

Phase 3: Exploit
Apart from driving value for the business, process improvement intiatives also build capabilties for additional imprvements. How? The experience of going through an improvement project builds valuable experience in your people. Also, with systems implementations, the full capability of the new system is fully exploited in the begining. Thus, the objectives of this phase are:
• The formalization of the process for identification and prioritization of exploitation opportunities driven by business value proposition.
• A structured process for planning and execution of continued improvement initiatives.
• The organizational alignment of resources.

This phase must result in well managed improvement initiatives and resources that are aligned to effectively exploit opportunities.

RELATED ARTICLES:

• Driving Business Benefits from your ERP Implementation
• DFSS: Monte Carlo Simulation in Business Process Design

The Six Disciplines: Building Excellence in Small Businesses

"Unfortunately, many of us are caught trying harder and harder to "whistle a symphony" when we should really be building an orchestra."

According to Gary Harpst, author of "The Six Disciplines", even though small businesses collectively generate $5 trillion in sales in the U.S., the biggest challenge of an individual business is 'survival'. 80% of all new business start-ups are out of business within five years. And 80% of the 20% that survived do not survive another five years! That means that, on average, only 4% of small businesses starting this year will be around in 10 years.

What makes it so hard?

In his book "Six Disciplines for Excellence", Gary Harpst details a roadmap for small businesses to learn, lead and last. This book is based on over 30 years of experience and research into more than 300 small businesses - each with 10 to 100 employees. The result is a book which is lays out a systematic approach for building and sustaining a successful business - driven by excellence. This systematic approach is what Harpst has termed The Six Disciplines:

1. Decide what's important. Based on your mission, values, strategic position and vision, what are your vital few objectives? What are you doing that you should stop doing?
2. Set Goals that Lead. What are your business measures, targets and initiatives? And how do you engage your team?
3. Align Systems. What in your business is not aligned with your strategy? How do you align your processes, policies, measures, technologies and people?
4. Work the Plan. How and when do you define, review, rate and prioritize Individual Plans to ensure that your business goals are being worked at?
5. Innovate Purposefully. How do you tap into the creativity of your team to create new and innovative ideas to solve problems and drive excellence in your business? As business owner, how do you recognize individual contribution?
6. Step Back. How and when do you review the internal and external factors impacting your business? How do you review performance of people?

Gary Harpst and his team have put a tremendous amount of work into detailing the steps within each of these disciplines so that this book can really be used as a small business owner's manual. They have succeeded in developing a practical methodology for those of us who spend too much time "working in the business, instead of on the business". These disciplines define solid well structured approach that supports the small business from strategic and tactical planning to the execution of tasks to meet the business' goals every day.

This approach is not for large businesses - it is targeted at small businesses that employ between 10 and 100 people. It is also not for those who are looking for a 'quick fix'. Success in using The Six Disciplines takes ... well, discipline. You would not expect to see results of this approach within 6 months.

I like the approach and would recommend the book, as it is uniquely tailored for small businesses; it is well written with a lot of substance; and gives business owners a practical tool that they can use to implement business improvement for sustainability, growth and excellence.

RELATED LINKS:

• Be Excellent Blog
  

The Top 3 Myths about Business Intelligence

Myth 1. BI is a technology solution.
Myth 2. BI is all about data warehousing.
Myth 3. The IT function can take care of BI.

The July edition of the PMI Network magazine carries an article entitled Get Smart. In the article, Malcolm Wheatley outlines some good case studies that dispel the above myths around Business Intelligence.

The example that caught my eye (mainly because it is close to my heart) is that of Coca-Cola Amatil in Australia, and what they have done with BI to drive improvement. By using good business intelligence, they were able to avoid investing in additional production capacity by improving their existing line capacities. I'll let you read the details of this case, but the basic steps of BI were followed:

• Collect data. At Amatil, they collected highly granular, second-by-second data off their line PLC's.
• Store it. Warehouse your data.
• Carry out that Analysis. Look and data trends and patterns over time or compare what is happening in one location over another. Those of you who have read some of my Six Sigma posts will see the relevance on BI in analysing processes to get to the root cause of problems.

Dispelling those Myths:

1. BI is a technology solution. No, it is not. BI is a management initiative powered by data.
2. BI is all about data warehousing. No, it is not. The analytics and reporting are at least as important. (Good to know when you are chosing a BI solution or vendor).
3. The IT function can take care of BI. Yes, BUT - if you want measures that are 100% focused on the objectives of the business, the business better have total ownership of the BI solution. IT should certainly take care of the data warehousing.

RELATED ITEMS

• Data Rich, Information Poor?
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____________________________________o________________________________

SMALL BUSINESS VIEW

What information do you need to run your business?
Understand what data your business processes generate. Capture and store it.
Make the time to analyze this data. Look for trends over time; for patterns that point to problems in your business.
Improve your business!

Are you a Change Agent?

"You could not step twice into the same rivers; for the waters are ever flowing onto you." - Heraclitus

In her book, "The Change Agents - Decoding the New Workforce and the New Workplace", Liz Nickles discusses the fact that America in 21st Century still straddles the great digital divide. Workers on one side of the line working 24/7 from virtual offices, while others are still trying to program their VCR's and wondering what this 'internet thing' is about.

In this ever competitive job market; organizational changes; and the ever growing use of the web and digital tools to increase connectivity and productivity, her research is increasingly relevant. Nickles reveals the following trends:

• Lifestyle Entrepreneurialism: Entrepreneurs are starting younger. "I took an entrepreneurial approach to everything in life" said the co-founder of the now-defunct dot-net startup. The age of the internet has allowed young people to sidestep the traditional corporate ladder.
• Full Engagement: The new workforce never feel like they are doing enough; never thinking enough. Always searching the new boundaries, the new terrains.
• Convergence: The boundaries between home and work life blur and Change Agents like it that way.
• Getting a Life: The new workforce believe that work (even if it takes 18 hours a day) is just a job, and that they can and will walk away from it. In the book, Nickles quotes software designers who like to hike in Nepal every year. "You just won't see me in October because it is the best month to go hiking there."
• Early Retirement: The new Change Agents do not believe in working mid-pace until they are 65 and then retire. They plan to work 24/7, cash out at 35, ... then move on.
• No Prisoners: Nickles' Change Agents will do whatever it takes to move ahead. They'll make note sof enemies and squash them.

In these times of change, Nickles also has some good advice for the Baby Moguls, as well as for the Baby Boomers. This is a relevant book, especially for you reading this blog - a product of our 24/7 worklife!

RELATED POSTS

- Organizational Restructuring

Cheap Technology - for Small Enterprises

Two articles caught my eye in this week's edition of BusinessWeek: The Next Cheap Thing and More To Life Than The Office. What these articles talk about are two ideas that have been around for a long time - that were perhaps ahead of their time.

"The Next Cheap Thing" talks about the use of 'thin client' devices, consisting of not much more than a keyboard, a mouse and a monitor that are linked to a 'server' with the capacity run the require applications and store data - remotely from the device. In this article, Stephen Dukker of NComputing talks about the price devices dropping from around $50 to the point where the "hardware would be essentially free". There are plenty of competitors out there in this market too.

"More To Life Than The Office" discusses Microsoft Office's rivals in the office productivity market. MS Office's (Word, Excel, Outlook, & Powerpoint) dominance in the market at around 95%, is being challenged by others that are competing on price and features.

So what's the connection? Why did these articles grab my attention?

These articles talk about how wonderful this cheap technology is for non-profits, schools, etc. And that is all great, but how do we apply these technologies to commercial enterprises.

Large commercial enterprises would not be interested in moving away from MS Office ... in the short term. MS Office would just be too hard (and expensive) to replace in most places. Not to mention that many comparable products are simply not good enough to fully replace the full suite of MS products used in most larger companies. However, the 'thin client' solution may have applications with certain company locations.

However, what I have seen of many small businesses, is that they simply need an easy to use cheap solution that does the job. A combination of a thin client set up with it's advantages, and suite of applications that support basic office functionality (Internet, email, word processing, spreadsheets, & presentation graphics) will provide a technology platform that will enable small business processes to be automated and thus drive improvement.

Check out a few options out there for cheap office applications:

• OpenOffice: Free office suite from Sun MicroSystems with about 40 million users worldwide.
• Ajax13: Free collection of Web applications that support some office requirements. Still early stages - but watch these guys, they are gaining about 10,000 new users per day (according to the BusinessWeek print edition)
• IBM Workplace: IBM's suite of office products with about 1 million users. Costs around $69.

Yes - there are other free word processing, spreadsheet, email applications out there. And if you are looking for a free web browser - Mozilla Firefox is the way to go.

... so with some creativity and know-how, you can maximize your productivity while minimizing your investment and cost of doing business.

. ... Now that sounds quite entrepreneurial - just what small business is about!!