In today’s highly globalized economy, technology allows businesses to transact with consumers outside their geographical boundaries. Companies set up offices offshore to cater to their global clientele and top regional talent. The world is more connected than ever before that even small businesses can hit it big in the global scene. While these advancements due to eCommerce and globalization are great, they come with challenges.
Operating on a global scale also opens businesses to a bunch of process variations. Companies can be subjected to regional or local government regulations. They may need to tweak their processes to accommodate upstream suppliers.
There can be local market-specific needs that require a change in how a certain product or service is done. While process standardization should be every company’s goal, the path towards it is not linear.
The Illusion of a Standard Process
Process variations are process management’s dirty little secret and there’s no surprise why. I remember a project I worked on for the HR department of a broadcasting network. Our goal was to design the payroll management software for their off-camera staff.
As I interviewed each of the process owners for the different staff groups, they all told me, “We have a standard way of doing things.” At the back of my mind, I thought, “Yes! This is going to be easy since they have one way of doing things.” So I let them detail this “standard process” while I take notes.
As I went back to my desk to map out all the information I got, I realized how “standard” means differently from each of the process owners. They all had a general idea of what their standard process looked like, but when it’s time to execute, they each had their way of doing things. Since they were handling different employee groups that had specific payroll needs and terms, they needed to tweak the process to work for them.
What I thought was “easy” turned out to be more complicated than it seems. There were a lot of process variations experienced by this group.
Process variations are experienced by any business at any level. It’s hard to make everything fit into a mold. A multinational company may think their procurement processes are uniform across their offices. But there can be nuances that are specific to a regional office. What’s worse, one office is doing things very differently than the rest. While these variations are a reality for businesses, it doesn’t mean we shouldn’t strive for process standardization.
Process variations come with costs and if we are unable to manage them, we can’t optimize the capability of our people and systems. What we should do is become aware of the variations that exist and find a way to manage them.
7 Steps to Effectively Manage Process Variations
While we can expect process variations, we are not powerless in controlling them. The key is becoming aware of them and deciding which are necessary and which ones should be eliminated. Here are 7 steps to manage process variations in your business:
- Agree on the standard process – The standard process becomes the foundation to which any process variation can be reviewed and measured against. All process owners involved should agree to what the standard process looks like and use it to govern the implementation and evolution of the process as variations are factored in. Creating your value stream map will help you visualize what your standard process looks like.
- Establish local variations based on the standard process – Local process variant experts should highlight any change that needs to be done from the standard process. It’s strongly advised that a business process mapping tool is used by the company to properly visualize and review how local process variants differ from the standard process.
- Compare and review all process variations – Compare all process variations for each standard process and assess which are legitimately needed. We need to ensure that all process variations are visible so that all process owners know what activities have been changed, added, or removed. This also facilitates streamlining activities to further rationalize the process. Comparing and reviewing processes should be an ongoing thing as we can expect both standard processes and local process variants to evolve.
- Ensure easy access to process variations – Business teams should easily access any process variation according to their specific needs, whether it be for their business unit, location, or team. A platform or tool that automatically routes them to their process variation of choice can be used for this purpose. This capability is particularly important when implementing new processes and onboarding new teams.
- Notifications on process changes – There should be the capability to notify and track any change to the standard process or any of its process variations. This will help process owners to review the changes and determine whether they will be implemented or not.
- Enable global reporting – Standard process champions should have the capability to review and assess all process variations. This allows them to ensure that nuances are controlled and only legitimate process variations are implemented.
- Analyze cost and time data – By tracking costs and time incurred in both standard process and its variations, process champions can make informed decisions on how to further streamline their processes. There can be process variation steps that get implemented as a standard.
There can be process variations that need to be removed because they’re incurring significant costs and time delay. These analyses can only be done when data is present.
The Path to Process Standardization
The journey to process standardization starts by having a clear path of what variations lie in your way. By having a clear picture of your process, you have better control of what variations you are going to let in. This helps you become more flexible to the needs of your business but still maintains the level of quality you expect.
Process standardization is not a one-time project. You must develop a continuous process improvement mindset and challenge every process variation that comes your way. Only then will you have a robust process and a solid foundation to which process maturity can be attained.