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In business, change is a constant. At most companies, every corner of the business is constantly facing factors such as new regulations, new technologies, market developments, product revisions, etc. In response, the business typically adopts a narrow focus on addressing the requirements imposed by the new factors, without consideration for the bigger operational picture.
This, of course, impacts the IT operation and its ability to maintain acceptable levels of application support. Quick-turnaround project requests make their way to IT's doorstep, and backlog becomes the norm.
With these dynamics in place, every company evolves to a state of operational mediocrity over time. The constant low-level, uncontrolled changes that happen in a process's everyday workflows and activity are normal, but any operation or product has only so much elasticity and can absorb only so much change before it begins to break. The cumulative impact of these low-level changes is, eventually, inefficiency and then ineffectiveness.
While most changes to a process or workflow are absorbed for many years, they add up and eventually cause the introduction of manual work-around activities. This starts the work sliding toward sub-optimization. This cycle of optimization and a gradual evolution to sub-optimization is normal. There is no way around it.
For example, consider the issue of automobile maintenance. As car parts wear out, they are replaced with parts that should each fall into a tolerance range related to that part. But, sooner or later, the cumulative effect of tolerance differences in the parts, which are each close to the original specs, is a small incremental move away from optimal performance. Eventually the automobile reaches a point where the combined effect of the replacements is inconsistent performance. If tolerances line up right, the automobile works. If they don’t align properly, the automobile stops working or wears quickly.
CI groups ready for a bigger role
Making these low-level workflow- and task-level changes is the traditional role of continuous improvement (CI) teams. These teams exist in several forms in companies, including Six Sigma, quality improvement and performance analysis teams. While quality improvement techniques started in manufacturing, most companies today have some form of quality or performance management teams. The teams are focused on making high-return, relatively small operating improvements and other small compliance or problem/resolution-related changes, rather than big-picture, mission-critical changes.
Like all business areas, CI group funding and staff levels will increase as they become more successful -- in this case deliver greater benefit. These teams thrive when focusing on fast, simple, high-benefit projects. However, as more and more quick, big-win projects are addressed, the group must move on to lower-value projects. At this point, benefit and thus value decreases and the CI staff and budget are on the proverbial “chopping block.”
The continuous improvement team's success is thus great for the company but not for the team itself. This is a trap for CI. The greater its success, the shorter its longevity -- as it literally works itself out of a significant role in the company. This reality is why the CI group must evolve and become players in the business transformation space in companies.
The current CI practice specializes in eliminating task, or step-level, work and at times, simplifying activity. But the competencies and skills needed for this detail-level improvement are not the same as those needed for larger business transformation projects. As this larger mission-critical transformation project work is started, the CI staff is often unable to provide the needed skills. This limits the group's flexibility and its ability to provide greater benefits.
Because continuous improvement teams normally have mastered many of the skills that will be needed for mission-critical projects, they are the most likely target of training investment and fertile ground for building a solid business transformation competency. Doing so will allow the continuous improvement team to be effective across both continuous improvement and business transformation projects.
Future outlook: High-stakes transformation
When business transformation and operational improvement are viewed over time, a clear cycle of improvement and transformation emerges. This cycle typically involves large transformation-type change with periods of small improvement. Because this is a long cycle, it often goes unnoticed.
In IT, we transformed in the 1970s when we went to online systems (CICS applications that used "screens"; the term monitor wasn't widely used for another 10 years). We transformed again in the mid-1980s with PCs and again with the internet. I was part of these transformations. And now, there are even bigger transformations ahead with business process management systems (BPMS), robotic process automation (RPA) and artificial intelligence (AI), supported by the cloud, big data and even faster, more flexible computing technology. The transformations of the past were disruptive and invasive, but they were critical to helping companies compete and thus stay in business. The transformation that is coming will likely prove to be even more critical to business because it reflects the shift of advanced technology into the hands of people around the globe.
Business transformation: The rethinking and redesign of significant parts of a business operation, challenging current thinking and IT support capabilities. Transformations tend to be cyclic with fairly long periods of continuous improvement work between the transformations.
Continuous improvement: Narrowly focused projects to eliminate problems, improve efficiency, reduce certain costs and address government regulations. These tend to be small, fast projects that may or may not result in changes to application systems.
To help with the coming transformation, companies will need to build business and IT transformation capabilities that represent the next evolution of CI and BPM.
With these factors at play, many industry experts and CIOs are deciding that the real goal of both business and IT transformation is flexibility -- not a single product or capability. Many people believe this flexibility will be a critical competitive differentiator in the future and that moving to this type of environment should be considered in each transformation project.
By aiming for flexibility, CIOs, the IT department and the resulting technology environment will be better able to respond to CI requirements, and the group will have an easier time evolving into one that supports true transformation. It will also help CI business analysts evolve into process analysts and process architects.
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