Software and process reviews enable continuous improvement

Editor's note: This is the first of a two-part series on the value of software and process reviews. The second part will appear in the March issue. Too often organizations view the completion of a software implementation project as the end of the road, rather than a milestone on the ongoing path toward continuous improvement.

02/10/2004


Too often organizations view the completion of a software implementation project as the end of the road, rather than a milestone on the ongoing path toward continuous improvement. Many executive sponsors consider their work complete once they have gained approval for new software.

Unfortunately, many software projects fail or flounder following the initial installation and implementation. Expected benefits are not fully achieved, and business processes do not continue to show the improvements they should.

Achieving results

Why doesn't a software implementation deliver on its promise? Because, often companies overlook the need for software and process reviews (SPRs) that evaluate current performance-driven productivity gains. They do not realize that the implementation of a new information system merely builds the framework to begin achieving operational benefits. Further, many companies perceive SPRs as expenses that are not value-added; they fail to notice the real cost of a software installation that does not achieve improved productivity.

Actually, SPRs are neither lengthy nor expensive and can generate impressive results for the organization. SPRs help hold the business process owners accountable for using new tools and metrics, and for achieving the expected results of the software project. An SPR conducted soon after the software installation helps to formalize the necessary transition from the implementation team to the operational team — the team that actually uses and relies on the new software tool and business processes. This "hand-over" aspect of the SPR supports the changes in business processes, best practices, and culture that are necessary to actually achieve ongoing improvements in performance. Followup SPRs help to maintain the productivity gains and identify new areas for further improvements.

You can't manage what you can't measure

An SPR reviews and examines several functional and operational areas including:

  • Business processes — ensure that the site is using the software tool as expected, conforming to the right activities, and generating the desired results and behavioral changes.

  • Controls and procedures compliance — determines whether each department is performing its role as designed. There are numerous touch-points to the maintenance workflow cycle — purchasing, stores, production operations, and financial integrity to the ERP system — that are significant factors in maintenance repair cycle effectiveness.

  • Benefits — assess whether anticipated benefits and progress are formally measured, reported, and communicated.

    • The most important objective of the SPR is ensuring that the plant is assessing and measuring the right factors and taking the right actions. Measurement is the best way to ensure that plant engineering projects and business process initiatives are delivering their expected benefits and that the plant is performing to its maximum potential (see graph on left).

      For example, an SPR brings to management's attention that an important measure of equipment reliability, such as mean time between failures (MTBF), is not being tracked or pursued. However, as a result of SPR, MTBF is established for regular review. The plant can begin to realize that productivity on certain machines is much higher than others, and can take appropriate corrective measures to improve equipment reliability and increase plant capacity. The results are higher overall productivity, an enhanced company revenue stream, higher equipment reliability and utilization, and proven cost reductions.

      Further, when conducted properly, SPRs are positive experiences for the site and staff — not painful exercises. Plant and production engineers gain insight into the potential benefits of the new software tool and how to use it more effectively; managers identify new areas of improvement and reporting tools for making better decisions.

      Too often, the individuals using the software tool to carry out system transactions at the operational level are the same individuals left to figure out the improvement objectives. If your company falls into this category, don't be surprised when you are achieving only marginal improvements and return on investment (ROI).

      Scheduling the SPR

      Typically, a plant schedules its first SPR three months after going live with new software and revamped business processes. Ideally, the plant has taken the critical steps during the initial software implementation phase to examine its business processes and define a clear strategy to drive the desired changes and performance gains throughout its organization. Therefore, in conducting an SPR, the company is able to make sure it is "staying the course" and achieving the expected results.

      If a company did not have the chance to review business processes and plan improvements during the initial implementation, then an SPR is an effective tool to start identifying areas for productivity gains. Sometimes, the scope of the initial implementation allows for concentration only on the software technology and business system framework. A subsequent SPR can use this foundation to initiate and address equipment, maintenance, and business performance goals at a later date.

      Also, an SPR may be scheduled to address lack of organizational support for the implementation (user dissatisfaction) or a review of the business processes, roles, activities, and measurements that were put in place during the initial implementation. These reviews can translate into a tremendous catalyst for improvement when software has been in place for some time and users have become complacent, or when new software features and modules have become available that could generate further productivity gains.

      The SPR project itself usually requires two or three days of onsite review, followed by two or three days to prepare the analysis and report. The analysis and report give direction to company team members on where to start the next phase of implementing continuous improvement. Additional followup reviews are often conducted quarterly or semiannually following the initial SPR, to monitor performance gains and guide further improvement.

      Structuring the SPR team

      While the SPR relies on team members within the company for information and analysis, experienced consultants should conduct the actual review. This ensures an independent, onsite review and validation of the business processes around the new software tool and objective suggestions for improvement.

      The company team members should include users and business process owners who are accountable for the expected benefits. In a manufacturing environment, the team could consist of maintenance staff and managers, engineering staff, plant management, accounting, finance, and corporate users of the software to be reviewed.

      Potential consultants should provide experience and independent evaluation capabilities. They should offer extensive knowledge of measurement techniques; reporting; and business, manufacturing, and maintenance process reengineering across several industries. These experts should be able to assess the plant's progress in equipment reliability, operational efficiencies, cost improvements, and use of plant resources as they relate to the new software and business processes.

      To be effective, consultants should focus on finding answers to the following questions: