Booz Allen Hamilton: Eight principles for optimizing business practices (page 2 of 2)

3. Select the improvement method that best fits the circumstances without being dogmatic about any one tool. Successful companies are flexible and avoid a dogmatic focus on one methodology. Depending on the degree of change, potential impact, scope, and timeframe of the initiative, they apply various methodologies and determine whether the best approach is to completely transform the process or merely tweak a functioning process.

4. Strike the right balance between standardization and customization by listening to all of the stakeholders' input on processes and technology. Booz Allen Hamilton has developed an approach called "Smart Customization" to balance the various perspectives and identify the amount of customization that different customers truly require. The basis for Smart Customization is to segment the process inputs and outputs (mini-supply chains) based on similarities, and then to design customized processes tailored for the need of individual streams of work. This enables companies to be sophisticated when and where needed but also to be able to utilize standardization to reduce overall business complexity.

5. Organize for sustainability in a way that holds process owners accountable for performance. Typically, and especially in a unique environment like the Middle East, there is no single organizational solution; the optimal model will vary depending on the company's current organizational philosophy, its underlying culture and the available capabilities. Organizational issues do not always need to be addressed immediately though, since they may require fundamental changes that can take a longer time to implement than realizing quick wins on the process side.

6. Get cash back to the business quickly to demonstrate the value of the project. Segment the solution and implement the different parts as soon as possible. This leads to two benefits: returning cash to the business early and testing the solution gradually, which minimizes the risk to the business and ensures buy-in from management and staff for the overall initiative.

7. Make change management central to the entire project to prevent derailment by people issues. Processes do not change unless employees change and employees do not change just because their management wants them to. It is therefore important to communicate well, make the benefits of change clear for everyone and then monitor behavior and address it in the context of a short feedback cycle, with special emphasis on rewarding process adherence and addressing non-compliance at the individual and unit levels.

8. Manage the effort as a program to facilitate a process-driven culture, monitor for success, ensure design equity, and reach the desired result. Many companies find that individual process improvements face additional hurdles if they are not rolled up into a programmatic effort. The "what's next" question needs to be addressed just as well as impacts on other processes or areas inside and outside of the organization. It is therefore important to elevate the improvement initiative to a program level, with adequate funding, visibility, resources and - last but not least - top level sponsorship to ensure the organization's commitment to change is widely understood and followed.

"Companies that wish to transform their businesses into instruments that can win in the increasingly competitive Middle East market place and ultimately produce more value need to develop and use process excellence to their advantage," concludes Karim Ragab of Booz Allen Hamilton. "What we have laid out are basic rules but they can revolutionize the way business is conducted, especially for the ones that apply them first."

Optimizing businesses should also never be seen as a one-off activity. While it is often important to actively drive performance improvement boosts, ultimately the responsibility lies with senior leadership to actively engage and instill a culture of continual process optimization in the form of an ongoing and iterative assessment of the way a company thinks, performs, and derives value - now and into the future.