The Critical Link of Activities to Business Results

If you were asked to comment on an assessment of the last year's continuous improvement, what might your review look like? Would it be a list of actions and activities completed, or might it be more in terms of impact - as in business results of the activities? Consider that the most important aspect of any improvement initiative is a direct correlation between the activities and a measurable business result. By framing a project in this way there will be alignment of actions, decisions and resources with those intended results.

Here's a deep question for you to consider - "What is the reason a company has groups of employees organized as divisions, operations and departments?" What is their reason for existing? They exist solely for the reason of producing a positive impact on revenue, either directly or indirectly. Every organization, sub-organization or organizational silo must be viewed as an element of the revenue generation machine.

It's easy to fall into a thought pattern where you believe the decisions and actions responsible for profitable revenue reside somewhere else, in fact you may be thinking that right now. When this view occurs within an organizational unit, results become unrelated to the big picture business objective of revenue. Improvement actions and objectives take on a form that produce localized, narrowly focused results. The trouble is any localized positive change may have little or possibly negative impact relative to producing revenue. Without a critical emphasis on business results, any process improvement change can end up being an expensive trip to nowhere.

When starting an initiative that is intended to produce a higher level of efficiency, never loose sight of the fact that the result must always be measured as the impact to producing profitable revenue. Any efficiency change must have an outcome that impacts at least one of these: 1) enable quicker revenue, 2) provide increased revenue, or 3) improve revenue margin. If the initiative can't be measured against some aspect of impacting revenue results, it is not a properly framed improvement project. Make no mistake, the name of the game is "making money" - bottom line.

A highly effective efficiency change will result by developing a strategy, aligning objectives and building a team with an objective of revenue impact as the motivation. And yes, for proper financial emphasis it will always mean project participation outside your organizational silo; it may even be wise to consider outside leadership! Broad participation is essential to dilute the incestuous pool of same thinking that cripples real change. Focus activities only on results that matter to the business!