Why is an accurate understanding of cost-time important? Competitive position can be easily upset with dramatic shifts in the product cycle time (order through delivery through payment). Customer value and loyalty improve when cycle times are shortened and consistent. Costs can be squeezed out of the process by doing things right the first time, thus eliminating the use of overtime to meet the end-of-month crunch and minimizing rush orders.
Process Reengineering is understanding and measuring the current dynamics of value, cost and time to achieve improved productivity. Then redesigning the process to improve workflow, reduce steps and dramatically shorten cycle time which increases capacity. Therefore, organizations can reduce their costs while increasing their value delivery.
Performance improvement is enhanced by managing the new-found capacity through changes in activity, roles and responsibilities – i.e., doing more with less. Value-added or revenue-producing activity is expanded, while essential activity is reduced through simplification or automation, and non-essential activity is eliminated. Thus, the effectiveness of ALL activity – not just processes – improves while revenues increase and costs are reduced.
Have you tapped into your customers’ true needs?