By Roger La Salle
A short series
The next few posts we are proposing will address simple ways to look at your business and simple ways to achieve growth. But please, at all times, keep it simple.
There are only two ways
In essence there are only two ways to improve profits, it is suggested both these initiatives be employed:
- Process Innovation – Reducing costs whilst selling the same products
- Product Innovation – Exploring new products and markets.
This post will focus on Process Innovation, whether it is in manufacturing, sales, distribution or marketing.
Process Innovation
Process innovation is something every business should invest in, whether in the manufacturing or services sector. The Book, “Think Again” has the byline heading, “Invest in Process Innovation and Harvest Untouched Wealth”. How true this is because with processes there are always gains to be made that are risk free if done properly; and there is no market risk, just more margin to be gained.
5S
The most simple technique is so easy it’s hard to imagine it’s become one of the foundation stones for process improvement. Called 5S, this in essence simply asks you to tidy up, organize, put things back in the right place and ensure everything is in proper working order. The Five S’s are Sort, Order, Shine, Standardize and Sustain.
Kanban
Another common and easy to implement method is referred to as Kanban, a Japanese word for Visual Signal. This is a way of visualizing and ordering work flow, often using a system of cards to represent stages of work as it moves through the facility. Kanban is an efficiency optimization tool that properly used also leads to improved inventory management and “Just in Time” delivery. There is a great deal of material on this system on the internet.
ISO9000
Unlike what many people may believe, the ISO regime is not about creating quality products as such, but more about traceability of product development and manufacture. As you can imagine, this is vital in the food and chemical industry, but ISO has over years expanded to include all manner of businesses. Not to guarantee quality, but to ensure all initiatives are documented and traceable.
Six Sigma
This is a quality control system, with the Greek term Sigma (σ) being used by statisticians to signify Standard Deviation in a data set. The Six Sigma doctrine stipulates that no more than 3 samples in a million are permitted to be outside their specified tolerance limit. This is nice in theory, but if given as unfettered power of enforcement to quality controllers, can lead to huge disruption in manufacturing processes.
Matrix Thinking
The system we also suggest is founded on the Process Innovation Matrix that employs just three “Seeds”, or primary areas of focus, these being:
Costs – What are all the costs separately identified in your manufacturing and business processes
Cycle Time – How much time is spent on each activity, leading to product and business cycle time
Quality – Defined as “Conformity to Specification” asks how quality may be effected by the push for process improvement.
The Process Innovation Matrix presents 10 ways to explore each of the Seeds. It is virtually impossible to explore each of the matrix intersections without identifying a breakthrough opportunity and thus, reaping that unharvested wealth.
However, before embarking on any process innovation we suggest it’s first necessary to measure and map the process you are exploring. Without that knowledge as a starting point it’s quite amazing how small changes made can have catastrophic unforeseen knock-on effects. In short “Map and Measure” before you start.
What’s the Message?
Process Innovation is a must for all businesses and can yield unharvested wealth. The key to this goes beyond just 5S, Kanban and others; and when combined with the Process Innovation Matrix a unique and comprehensive approach is provided that has been employed with great success in more than 20 countries.
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Roger La Salle, trains people in innovation, marketing and the new emerging art of Opportunity Capture. “Matrix Thinking”™ is now used in organizations in more than 29 countries. He is sought after as a speaker on Innovation, Opportunity and Business Development, is the author of four books, and a Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies, both in Australia and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panelist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast.
