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Focus on Short Term Cost Cutting Sets Process Improvement up for Failure, Finds Global Survey
LONDON, November 30, 2011/PRNewswire/ --
Process improvement programs are most likely to fail if the key focus is on cutting
costs, according to a global PEX Network benchmarking survey.
The October 2011 PEX Network survey, in which over 650 process improvement
practitioners participated, found that a customer-focused approach to identifying and
improving operational processes is what sets a company up for long term success.
Over 40% of process improvement programs that practitioners considered "unsuccessful"
or "highly unsuccessful" were driven by cost cutting; only 20% of "highly successful"
programs focused on this metric. Meanwhile, 32.5% of "highly successful" companies focused
on the customer with just over 10% of unsuccessful programs considered customer-centric.
"A focus on cost savings, while clearly important to businesses during a time of
economic uncertainty, can translate into a demoralized workforce and ultimately lead to
what is perceived as the failure of an operational excellence initiative," said Diana
Davis, Editor of PEXNetwork.com and author of the report. "The trouble is that sometimes
these initiatives become associated with job losses, budget cuts, and increased workloads
- and how can you get enterprise-wide buy-in if that's the perception of process
improvement at your company?"
"The report highlights the fact that customer-centric process improvement - something
both PEX Network and many of our global partners have been advocating for several years
now - is the key to ensuring that process improvement activities deliver value to both the
business and its customers," added Vanessa Lovatt, Director of PEX Network.
Other highlights of the report include:
- Companies are relying on shorter cycle times for process improvement
projects with a significant increase since 2005 of respondents reporting average
project length of 90 days or less
- Lean and Six Sigma methodologies remain prevalent although nearly 50% fewer
respondents report the use of Six Sigma methodology than in a similar 2005 PEX Network
survey
- The greatest danger period for companies operational programs is after 2-3
years of process improvement activity when respondents were most likely to rate their
programs as unsuccessful
The report findings will be discussed in further details at PEX network's flagship
event for Lean Six Sigma and BPM practitioners, PEX Week. The event takes place 16-19
January 2012 in Orlando, Florida. Further details can be found at:
http://www.pexweek.com/Event.aspx?idW2170&utm_source=PRNewswire&utm_medium=PressRelease&utm_campaign=PEXwhitepaper&utm_content01111&mac126.005_PEXWP
A full copy of the report can be downloaded at: Trends and Success Factors in Business
Process Excellence 2012
http://www.pexweek.com/redForms.aspx?idW2142&sform_idf7618&utm_source=PRNewswire&utm_medium=PressRelease&utm_campaign=PEXwhitepaper&utm_content01111&mac126.005_PEXWP_
!
Media contact: Veronica Araujo, +44(0)20-7368-9748, veronica.araujo@iqpc.co.uk
Press are invited to attend this important industry forum, if you would like to a
complimentary press pass please email Veronica Araujo (veronica.araujo@iqpc.co.uk)
Source: PEX Network
.
Focus on Short Term Cost Cutting Sets Process Improvement up for Failure, Finds Global Survey
LONDON, November 30, 2011/PRNewswire/ --
Process improvement programs are most likely to fail if the key focus is on cutting
costs, according to a global PEX Network benchmarking survey.
The October 2011 PEX Network survey, in which over 650 process improvement
practitioners participated, found that a customer-focused approach to identifying and
improving operational processes is what sets a company up for long term success.
Over 40% of process improvement programs that practitioners considered "unsuccessful"
or "highly unsuccessful" were driven by cost cutting; only 20% of "highly successful"
programs focused on this metric. Meanwhile, 32.5% of "highly successful" companies focused
on the customer with just over 10% of unsuccessful programs considered customer-centric.
"A focus on cost savings, while clearly important to businesses during a time of
economic uncertainty, can translate into a demoralized workforce and ultimately lead to
what is perceived as the failure of an operational excellence initiative," said Diana
Davis, Editor of PEXNetwork.com and author of the report. "The trouble is that sometimes
these initiatives become associated with job losses, budget cuts, and increased workloads
- and how can you get enterprise-wide buy-in if that's the perception of process
improvement at your company?"
"The report highlights the fact that customer-centric process improvement - something
both PEX Network and many of our global partners have been advocating for several years
now - is the key to ensuring that process improvement activities deliver value to both the
business and its customers," added Vanessa Lovatt, Director of PEX Network.
Other highlights of the report include:
- Companies are relying on shorter cycle times for process improvement
projects with a significant increase since 2005 of respondents reporting average
project length of 90 days or less
- Lean and Six Sigma methodologies remain prevalent although nearly 50% fewer
respondents report the use of Six Sigma methodology than in a similar 2005 PEX Network
survey
- The greatest danger period for companies operational programs is after 2-3
years of process improvement activity when respondents were most likely to rate their
programs as unsuccessful
The report findings will be discussed in further details at PEX network's flagship
event for Lean Six Sigma and BPM practitioners, PEX Week. The event takes place 16-19
January 2012 in Orlando, Florida. Further details can be found at:
http://www.pexweek.com/Event.aspx?idW2170&utm_source=PRNewswire&utm_medium=PressRelease&utm_campaign=PEXwhitepaper&utm_content01111&mac126.005_PEXWP
A full copy of the report can be downloaded at: Trends and Success Factors in Business
Process Excellence 2012
http://www.pexweek.com/redForms.aspx?idW2142&sform_idf7618&utm_source=PRNewswire&utm_medium=PressRelease&utm_campaign=PEXwhitepaper&utm_content01111&mac126.005_PEXWP_
!
Media contact: Veronica Araujo, +44(0)20-7368-9748, veronica.araujo@iqpc.co.uk
Press are invited to attend this important industry forum, if you would like to a
complimentary press pass please email Veronica Araujo (veronica.araujo@iqpc.co.uk)
Source: PEX Network
.