I learnt something important during my first annual performance review as a Manufacturing Manager with a multi-national company, more than a decade ago. Measuring the real business performance maturity is not just based on Profit & Loss (P&L) results.
In that year, one of the production lines I was responsible for, delivered exceptional results throughout the year. During the review, the first two questions the Site Director asked me were, “Ishan what processes have you leveraged to deliver this result, and what role have you played to make it happen?” It was clear that the process was far more important than the result – something I hadn’t registered in my mind.
The way many measure their business maturity is limited to the Profit & Loss (P&L) statement: sales growth %, gross margin and net profitability improvements, inventory turnover etc. And the approach some take is similar to killing the duck to get all the golden eggs, in one year!
What I later discovered, especially during my global Operational Excellence involvement at Kellogg’s, is that world-class companies place at least an equal, if not more, emphasis on processes to deliver exceptions results. Like the multiple cogs that connects with precision in a Swiss watch, business processes, when in place,
You are perhaps wondering what these magical processes are? Well, there are many, but here are a few examples. I’ve also compared the difference between majority of businesses versus world-class.
The focus by world-class is to ensure that processes are in place and effective to the point that they don’t change, every time the guard changes. World class companies spend days to go through maturity review assessments on a regular basis to measure progress against ‘process maturity’. They know that higher the process maturity, the more stable they are to continue delivering exceptional results, year-on-year.
“Focus on the process, not the result. The process will deliver the result”
Do you know the process maturity of your business? Do you have a system to do that?