Thursday, January 12, 2006


up the business value chain

Restructuring business processes have been one of the most important -- if problematic -- activities in business strategy over the past decade. Reducing waste can cut costs and even enhance revenue, through increased responsiveness to market conditions. But poorly considered restructuring can be a nightmare.

I don't pretend that usability holds all the answers to how business should structure their process -- business is too complex for any one "formula" to work magic. That said, I would modestly suggest that usability can be an important resource to developing an effective implemenation of the restructuring of business processes.

Usability often is focused on the micro, rather than the macro. It might look at what individuals do, their specific tasks. Through task decomposition and task analysis, it seeks to develop an optimization of how the task can be done by people.

Usability also looks at how groups of people coordinate tasks, that is, how they perform activities. Originally, these group tasks were focused on teams, who needed a common view and shared understanding of what they were trying to accomplish. But as the world has become more joined-up through the Internet, the team has become a more amorphous concept, less of a cohesive social unit. Groupware has given way to portals that anyone with a password can access. Even the distinction between employees and customers is getting blurred. When customers access a portal to track their package shipments, they see the same data as employees. Questions now arise: should they see the same view, or a custom view?

Just as tasks can be simplified to reduce the time and number of steps need for an individual, entire activities involving numerous people can be simplified. But usability is commonly associated only with optimizing tasks done by individuals or small groups. As a result, it is sometimes dismissed as irrelevant to restructuring larger processes. Sometimes user research is criticized as merely tweeking an existing process, rather than as enabling a radical new process that is much more efficient. I believe such an attitude is shortsighted.

Most work on business process restructuring looks askance at people. Indeed, much process reengineering is aimed at reducing the numbers of people involved in a process in order to gain greater efficiencies. But too often a focus on process automation can lull strategists into ignoring the reality that people never disappear, they are sometimes simply marginalized.

One of the most common ways businesses reengineer their processes is by outsourcing their activities to their own customers. This is more commonly referred to as "self service." Businesses get to reduce staff, and trumpet the fact they have automated, even if they have mostly shifted the annoying data entry responsiblities on to their customers. Customers, whether businesses or individuals, agree to this provided they are given sufficient incentive. The incentives vary, but at a minumim the burden can't be too complicated. In other words, it must be usable.

Even when businesses don't outsource functions, usability places a critical role in the effective implementation of a reengineered process. Consider a common target of process reengineering: eliminating "unnecessary" internal approvals. One approach is to streamline the process, to simplify. It can yield a faster process cycle, and make the process more transparent to employees, who understand the simplified process more easily. Many businesses have found that streamlining processes have reduced costs enough to offset any benefits associated with the prior process.

The other approach to internal approvals is to automate them. The danger of eliminating them is that it can led to looser standards, and more risks. Many businesses choose to continue to collect all the data, but to feed it to an automated decision program. Because a computer program acts on the data, it might be no slower than if the approval had been removed, but it elminates risk and improves decision making precision. Only one small downside: it can make things cognitively complex, as employees need to decipher the meanings of computer decision agent. Usability can potentially help untangle this problem, looking at how this is presented to users. Perhaps analyzing messages or visualization solutions can increase employee comprehension.

However businesses choose to reduce procedural complexity, they must make their processes understandable to their employees -- and their customers. Employees need to be able to tell customers, who might be anyone outside the immediate process, what is going on. (Don't limit the concept of customer to individual consumers. Many companies have internal units that competitively bid for business from their own parent. It's an unforgiving world in business these days.) Companies look incompetent if employees have to say "it's somewhere in the computer system" or "the system rejected the request." The entire process must be comprehensible, that is, usable. Anything else is false economy: cost effective in a spreadsheet model, but not sustainably effective.

I think that the issue of stream-lining and reducing waste within companies is a very complex subject. The complexity doesn't come into what methodology to use (i.e. Lean Manufacturing, Six Sigma) but rather the complexity of what organizational structure is "steering the boat". Strategic Business decissions are made from afar and the people making these decission don't know the issues from the operational side of things. In my current position I am in charge of reducing waste in the form of variation reduction, as well as eliminating waste in space, distance, and time. I have seen many times where business will change the direction of the business because they believe it to be more profitable before the operational group make improvements and show that the current business is profitable.

Just my thoughts....
Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?