Monday, February 19, 2007

Lean - Waste Part 2....

Another Lean Waste element is waiting time. Time where a customer request is waiting...
Let's go back to our insurance process, handling a request for a customer (a new insurance).

Do we have waiting time? You bet...
- A request waits in the mailbox to be picked up by the business and be distributed
- A request waits on an available employee to handle it
- A request waits because the company requested additional information from the customer (incomplete or incorrect)
- A request waits on availability and action of a internel employee, to provide internal information (a decision, a review)
- A request (or following subproduct) is waiting for an automated batch process that will process it further (typically during night, or weekend, or end of month).
- A request is waiting for a manual batch driven process ("once a day, in the morning, we empty the "send files" box, book the items and give it to our team).

- If you walk around in the these types of companies, you can actually see these queues... Try to find large stacks of files or cases, on desks, bookshelves, cars, etc). In manufacturing terms, this is called Stock or Inventory (of work-in-progress).
- A lot of the more traditional data processing financial companies find this Inventory quite normal. Always been there, we always done it this way, "no inventory is red alert - people not busy enough...."

The true facts (and manufacturing consultants will find the following observations not that surprising):
- Each request that is waiting, is NOT adding value to the end-customer. The end-customer did not ask for waiting time, he or she asked for an insurance!
- Each request that is waiting, is costing the company money.
- Each request that would be processed faster, earlier, would lead to earlier cash flows.
- Earlier cash flows is greatly appreciated by your asset management department, and your shareholders

Essential reading for the BPM consultant...
The Goal - Goldratt
The Goldmine - Balle
And check out the Lean Institute.
Good reading, also for BPM-specialists, and also for services industries....

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