Despite the obvious benefits of standardization – from the simplicity of managing fewer processes to the delivery of a consistent customer experience – business teams often push for local control and local variations, which opens the door for multiple versions of the same process.
The issue of process standardization has become even more complicated by globalization and rapid technological innovations. Even relatively small companies now find themselves doing business in multiple countries, operating in multiple regulatory environments, adapting to new technologies, and having little choice but to customize the customer experience they deliver.
At the other end of the corporate spectrum, some larger, more complex organizations find it easier to focus on smaller units than on the entire global enterprise. Citizenship is felt locally. This has the potential to create a weak corporate center, possessing the limited power to mandate compliance with standardized processes. And as power shifts to the periphery and is held by geographic, product or function leaders, it becomes almost impossible to focus on standardization and success across the entire enterprise.
All of these challenges result in too many process variations that are unnecessarily complex, costly, and inconsistent. It’s the dirty little secret of process management. Process owners know they have so-called “standard” processes that do not actually meet the requirements of the teams who are expected to apply them. These processes may as well not exist.
While businesses react to this issue in a variety of ways, there seem to be three most common responses to the problem of process standardization:
Create standardized processes at a high-level only: This approach is most commonly taken by early maturity organizations. It is problematic, however, in that information that is summarized at such a high-level is really not useful to anyone. It fails to provide day-to-day process guidance, while at the same time providing little from which to direct or respond to future change.
Create mega-processes that include every possible variation: To get their arms around all of the complexity, technical teams and large transformation projects often respond with detailed, technically correct process documents that apply approved process standards to a seemingly endless array of possible variations. The problem with this approach is that it is needlessly complex and difficult to understand. As such, it typically fails to engage the project team and stalls any attempt at agility.
Allow owners to create their own individual variant processes: Organizations that are further along the process maturity curve often opt to simply throw their hands in the air in desperation and allow process variants to be owned, managed, and changed independently. As might be expected, this approach creates administrative and change management headaches, does nothing to address cost overruns and process inconsistencies, and ultimately transforms existing processes into little more than “suggestions” as to how to proceed.
Given these responses, it’s no surprise that industry expert Steve Stanton, Managing Director, FCB Partners, concludes, “Ninety percent of the organizations I know have failed at standardization.”
Despite the many failed attempts, it is actually possible for businesses to achieve the benefits of standardized processes across their entire organization, while simultaneously providing individual operations with the ability to control process variations where needed.
As a first step, an organization must agree on the standard processes owned by global process owners. These will form a platform against which to consider local variations. Local process variations cannot be created haphazardly. Rather, they must be established only off of the base of standard processes, with all variations highlighted and visible against the core processes. Businesses must also have the ability to compare these variations to the standard process and contrast the impact of each process variation.
Next, teams must be able to select the variation they seek from a list or even better - be routed automatically to their process variant if they have a “default” location, product team or business unit. Doing so will improve process relevancy and adherence.
Organizations must also establish a global reporting capability so that process champions can see the list of variations that exist for each process. Local variant owners should be notified of any changes applied to the standard processes by the global process owners, enabling them to merge those changes into each process variant or amend as necessary.
Finally, process variant costing and timeframe tracking should be in place so that process owners can calculate the difference in cost and time between each variation and the standard processes. This will enable them to make informed decisions about whether to maintain or eliminate certain process variations.
Employing these steps will help businesses to understand better the extent of the process variations they are managing. That, in turn, will enable them to challenge, control, and report on those variants. It will also help them to be more agile, customizing or eliminating activities as necessary because they will have actual clarity and control over the process variations.