Process value analysis is the elimination of unnecessary cost and the addition of value through innovation. It is the stripping down and scrutinizing of supply chain processes in order to increase the value and desire of customers. Essentially, it is used to identify the least costly set of requirements needed without undermining the satisfaction of customers. Redundancies are chuck out for a more streamline process. The key is to be cost effective, building a high visibility and being concern about the needs of the target audience (customers).
A typical organisation would see various departments and external parties in coordination. It is a long process chain that’s prone to complications. Coupled with the desire to be opportunistic, the ability of the supply chain to effectively serve the target audience would be affected. Process value analysis seek to weed out the complications and serve the target audience with the optimal, least costly set of requirements.
The processes of supply chains are planned and conducted by people. To ensure the right implementation of strategy from the top, we have to start at the people and team level. Create the right mind set and transform a weak process into a valuable chain. See each process as a means to tinker, innovate and improve. This would then foster a culture of information sharing, which creates better visibility.
Process change is not a constant but an iterative process. Analyse each situation in process and seek the best fit, one that would deliver the best value to everyone involved. Adjust till the right value is found in the desired strategy – a strategy that would serve the target audience best.
How do we create the mind set for process change in the organisation?
1) One Table Approach – Eliminate redundancy and opportunism
Power and expertise allows people to withheld information, for fear of giving away ‘trade secrets’. Adopt a ‘one table’ mentality; treat the process like a giant start up. In ‘one table’, everyone involved in the process share a single big table. There is no cubicle or secrecy and this open policy promotes sharing. The removal of walls encourages people to voice their opinion openly. Lack of privacy translates to a more cordial environment for exchange.
2) Giant Playground – Promote interaction
Take the process like a giant playground. A standard playground involves successive obstacles to be overcome. We have to select the best possible route in order to reach the end fast. Obstacles along the process can be made interactive through leadership and teamwork. Each process is like an obstacle-filled playground. Appoint a lieutenant who would bring the troops to victory (in the case, serving the customers well). The only way through it is to group up and agree on a mutual direction forward. Remove the unnecessary clutter and noise.
Typically, cost arises due to lack of communication and the poor design of delivery. Value analysis is about doing more with an optimal set of resources. Narrow down to the specific point and re-engineer. The best solution usually resides in the people involved. Have a champion and assemble a highly motivated team to weed out the redundancy.
When you have create a mindset for change, it’s time to engage the people involved. How do we do it?
Tap on the game psychology and mechanics of Gamification. Provide a completion bar as a motivational tool to completion. Set leader boards for best price offered. Promote successful collaborations through acknowledgement; give a ‘pat on the back’.
Analyse the process and seek the best value for the target audience. First, we have to tune the right mind set and create the dream team within. The team have to be open to changes in the work processes or supply chain. Engage the team through methods such as Gamification. This would result in a thorough analysis of the process, which will achieve an optimal and valuable operation run.
This post was contributed by Max Ang, Business Development Mentee @ Gametize
Max is the summer Business Ninja at Gametize in 2014. He loves reading, especially on themes that deal with the modern society. A sporty person who enjoys runs in the morning and rock climbing on the weekends.