Forests and Trees: The Secret Sauce of Process Triaging






Scalability describes how much effort is required to grow or shrink an enterprise, noting we usually think about how to grow it.  It’s about how we grow from a few trees into a forest.

We get from low volume, tree-level thinking performed by individuals and heroes to high volume, forest-level thinking focused on processes that deliver the customer experience we desire when we hire team members who thrive doing processes we need to scale.

To be scaleable, we must build a team that is efficient in how it improves processes, and effective in how it finds the best improvement to make next — picking the best trees out of a forest of possibilities.

It requires finding and growing team members that can handle such empowerment.

That’s what process triaging does.

It builds the teams that make processes scalable.






Not All Bottlenecks Are Created Equal

All bottlenecks slow processes down.  These slow-downs are a problem when they’re on the critical path, the fastest way through a process network. 

However, not a bottlenecks are the same.  It depends upon their cause.

Here are three root causes to look for. Each has very different solutions.

  • Rework bottlenecks:  When work backs up because of errors, the good news is your quality control is working. Fix the inputs, work procedures or technology that introducing the error.
  • Resource or queuing bottlenecks: When work stalls out because you’re waiting on inputs or resources, the remedy is straight forward — fix the supply chain.
  • Waiting for permission bottlenecks: When work stalls out because you’re waiting for approval, such as an inspection or executive’s signature, determine if authority can be delegated. There are obviously proper, reasonable, and necessary checks to make in processes that make high risk decisions, but — remove bureaucratic, non-value added approvals,

What’s important about these three types of bottlenecks is their solutions are not interchangeable.  For example, adding resources to a rework-caused bottleneck will just exacerbate the delay.

Hat tip to Dr. Bradley T. Gayle and the Boston Consulting Group for these insights, from Managing Customer Value.  While a bit dated, these three types of delays have held up very well.

Here’s a helpful chart: Bottleneck Causes & Solutions



The Rosey-isms List

Here it is — my list of rules, laws, axioms, truisms, and blinding flashes of the obvious, in no particular order — thoughts that have stuck to my cranium wall after leading hundreds of process triages (on a napkin here).

I hope this list is be good enough to bookmark and I promise to keep it fresh.

  • Usually, it is unwise to fix the most squeaky wheel first.

    Almost every process triage workshop (overview here) illustrates why the most painful points on a process are not necessarily the first improvement investment.  Every point-of-pain, where the process is not behaving right, requires an investment to remove, either an action item-size Small Now or a project-size Big Now.  The triage team ranks remedies, not the amount of pain.  Quite often, a single quite point of pain, usually near the start of a process delivers the most capability improvement compared to where all hell breaks loose downstream.  These less obvious fixes often pay for the workshop’s opportunity costs.

  • If you don’t fix the quality of your work first, you’ll just create crap faster.

    You’d be surprised how often this is overlooked.  Of course, we’re not talking about designed speed where we intend to re-cycle and improve immediately, such as in Agile software development.When we look at a list of triage results — the Small Now’s action item-size  and Big Now’s project-size list, we recommend the process delay volume increases until most of the remaining items are “Enforce –‘x'”, as opposed to Analyze, Design, or Train.

  • Task complexity increases with volume.

    What works at ‘x’ volume blows up at ‘2x’ or ’10x’ volume, especially if it involved human labor.  Processing 25 paychecks every other week is QuickBooks® simple. Cutting 20,000 3rd Party commission sales force pay checks, where each SKU has a different compensation rate, off a base of 1 million point-of-sale transactions per month, is astonishingly difficult.  One of PT’s early successes was triaging such a process, hat tip Wendy Cogan, the host.

    This is why Google can’t update software very fast anymore.  Or why anything attempted by the federal government that involves transacting with hundreds of millions of citizens is incapable of being created quickly (Obamacare exchanges), which is why the smartphone mobile app world is so compelling — it forces simplicity.

  • Individual experts cannot fix what only teams can find.

    All of us are smarter than any one of usI cannot count the number of times one member of a triage team identified a process’s point of pain in which the solution was obvious to another team member who specialized in an upstream or downstream activity or silo.  And very often, the solution is not the obvious one, nor is it the one the executive would have pointed out.

  • You can free up cash to use elsewhere by (1) borrowing it at interest, (2) trading equity for it, (3) outsourcing necessary  work cheaper, or (4) improving insufficiently capable, cash leaking  processes you should own and lead.  Continuous Process Improvement (#4) demands you actually lead an organization.

    There are a number of tactics the CEO can apply to raise cash without involving more than a few staff members, like borrowing money, trading equity for some, or deciding not to do work others do as well or better less expensively.  But freeing up or generating cash through on-going operations requires business process improvement, which is a TEAM activity.  Improving team performance requires leadership.

  •  A Process Capability Goal is to process performance what Strategic Objectives are to enterprise performance.

    If  there is one behavioral indicator — one thing to look for, to determine if a business process is well-managed, it is the presence or absence of a Process Capability Goal (PCG – template here).   If the managers of a process do not know how well it must behave, in a manner that, if sustained, will deliver its share of the firms financial goals, it will be chaos and ill-conceived and  unfocused improvements.

  • Only managed processes are scalable.

    A process is not scalable that is not measure for speed, quality at essential points, and unit cost consumption.  Period. Full Stop.

  • You don’t understand your process completely until you can see it as a flow of cash.

    Seeing a process as a flow of cash separates candidate executives from impostors, for financial acumen and managerial accounting is lingua franca  of executive management.  As I’ve said, while stomping my feet for emphasis, “Money isn’t everything but it pays the bills for everything ultimately.  Every improvement that improves a process’s capability should make sense financially, and that story cannot be told unless one is aware of how and where a process consumes cash.  So teach your front-line experts, those who see the most capability-inhibiting issues, how their process eats or generates cash.

  • If you will not delegate a task, when it can be delegated, you are the bottleneck that inhibits your growth.

    As an enterprise grows, the time demands on the CEO are more outward facing, with investors and strategic customers and constituencies, leaving less time for inward, operational attentions. The roles of CEO and COO must split into different people.  COO responsibilities cannot be delegated if the business operating model does not push continuous process improvement tactics down into production spaces — delegated to them.  Process triaging is all about teaching and establishing operational improvements.

  • Don’t necessarily fix what you have not counted.

    Do not change your business model unless the one-time problem was obviously catastrophic.  Just count it instead and determine if it will repeat.  After counting it and establishing a trend, then fix it.

Watch a Bi-lingual Management Team Pick What to Improve First

For readers unfamiliar with Process Triaging (on a napkin here), one of the last steps of the triage has the triagers (the executives’ and manager’s front-line experts in the process we’re triaging), rank the two dozen or so improvements the team has proposed.  Each improvement is captured on triage card. The cards are lined up on a long table for the team to sort by highest value to customers, use of cash, and finally, what most delivers the process’s capability goal (sample here).

I’ve facilitated triage workshops in Hong Kong, Paris, and Zurich for example, noting everyone spoke English.  So it was a delight to triage a bi-lingual team of farm managers at Schwope Brothers Farms north of Independence, Missouri. They have well over a half a million trees under cultivation and grade about a 100+ thousand  trees for  sale a year.  It’s a world of liners, balls, burlap and attention to detial, plus a devotion to growing beautiful trees.

Tory Schwope, the CEO has a fabulous staff of farm managers that, given labor force realities, involve a bi-lingual — English and Spanish workforce.  So it was a delight to watch a triage cross this language barrier.

Here is clip of his triage team ranking their improvement proposals.  Enjoy


326-1 Schwope Bros -Group Photo (2)

Hat tip to Fernando Marrufo, handling the triage cards and host, Jeff King.

How To Estimate How Much Cash a Process is Leaking

The simplest tasks at high volume become ridiculously complex.

Compute the commission on a few sales transactions is stubby pencil work.  Try running a commissions payroll for 19,000 sales people selling hundreds of items, each with its own commission schedule because marketing wants to incentivize the sales force?  Best swap pencils for an Oracle or Teradata platform.  Which is what a company I triaged a few years ago did over a decade of solid growth.  Did I say it was hemorrhaging cash?  It had to process over a million point-of-sale records per month and was creating over a net 100% paycheck errors.

So we know a process at some volume will need oversight and end-to-end monitoring.  When should we think about biting the bullet and buying some dedicated process metering and management?  Some continuous process improvement?

Here’s a simple calculation to indicate when you need to deliberately manage a process and put it into a state of continuous improvement.

Step 1: name the process and set its boundaries, from what triggers it to its final work products:

  • Manufacturing from Factory Order Received to Installed and Accepted.
  • Loan Processing from Loan Submitted for Processing to Cleared for Close
  • Site Construction from Design Finalized to  Client Accepted

Step 2: Estimate how much cash this process is consuming per month.  Include direct and indirect costs, such as labor and floor space rents.  For labor, use a loaded labor rate, which is base salary + 20% (for benefits and some office automation).   Round it to the nearest $5K — just ball park it.   If the process generates revenue, add the average monthly revenue (before accounting adjustments) on top of the expense amount.

Step 3: Consider how capable  this process is, in terms of how well it runs.  Is there a lot of rework or rejects?  Is there a lot of employee turn over?  If this process is not running effectively and efficiently — whatever those terms mean in your context, then what percent (%)  is it under-performing?  10%?  15%?  35%?  A SWAG (Scientific Wild Arse Guess) is okay, but be conservative.

Step 4: Multiply the amount of monthly spend (from the second step) by the previous percentage.  That’s how much cash your process might be bleeding monthly. So multiply that number by 3 to see how much you’re spilling per calendar quarter.

For example, a $2,000,000/month process that is 15% not capable enough suggests $300,000 x 3 = $9ooK could be put to other use if we could see and stop the leakage.

So now you know if you need to buy some deliberate process management — if your estimate of the process’s capability shortfall is greater than the cost to make it capable. 

The ability to not spill this$300K/month (insert your cash amount here) will cost two things:

  • The cost to know what the best capability improvements might be — the Cost of the Improvements List, and
  • The cost of improvements on the list your team cannot get to, taking nothing else off their plate — the Cost of Not Yet’s.

Our flagship service, the Process Triage Immersion Workshop, generates this list of typically 20 improvement proposals that:

  • Have the  absolute buy-in by the producer / performer experts that must implement and live with these improvements AND…
  • Will improve the process’s capability (speed, use of cash, work product quality, scalable volume, better cross-silo work flow, etc.). AND…
  • Thereby better deliver the process’s share of your overall financial goals, AND…
  • Will specifically consider the impacts to your customer’s experience and your (CEO’s) bottom-line impact, AND…
  • Based on a completed staff work recommendation by the manager I choose, be achievable in the next 90 days, or have a price tag for what can’ be delivered that fast, AND…
  • It will only pull my best expert producers off the line for only one day, as a team, to deliver this raw, unassigned and unscheduled list for my manager to analyze and submit in an execution plan with10 days afterward, AND…
  • The immersion experience of producing this first list is absolutely repeatable if I need this team to refresh the list with minimal, optional outside facilitation.

So the kind of list we’re talking about is not your grandpa’s Suggestion Box, or organization survey.  Our Process Triage Immersion Workshop produces this list with your own process experts in ONE DAY of their time (and about three days of our certified facilitator’s effort).

What would you pay for this ProcessTriage quality list?

You will continue to bleed this much cash, monthly,  until you do something about it.