. THE PROCESS-BASED PROFIT AND LOSS ACCOUNT AND BALANCE SHEET:

The statement shows how our business is doing overall, but does
not tell us how well the processes are performing. What are the costs associated
with the Plan process? With the Make or Deliver process? Are these funds being
spent well?
The product design processes can
be dealt with in a similar way and can easily be added to the figure. The key
to the decisions is deciding who is accountable for generating the income or
consuming the cost � or has some responsibility for the process. As in many
situations, these roles are not always clear. In the authors� experience, one
process should be accountable for each key metric or share of it, and the
contributions of others should be clearly understood. The accountabilities and
responsibilities are then built into individuals� performance measurements.
Nonetheless, they will
all, ultimately, come under the control of one or more processes in the complete
enterprise process map. The ultimate responsibility of the managers of the
enterprise is, of course, to maximize the return for the shareholders and increase
the strength of their balance sheet.
We now have a set of metrics against which the performance of each process
can be judged as investments are made in increasing maturity. The same principles
can and should be extended to nonfinancial key performance indicators
such as fill rates, on-time delivery, and customer satisfaction. The impact of
process changes can now be judged against the RONA performance of the
whole enterprise. Are we reducing cost or increasing revenue? Are we investing
in our balance sheet in a way that enhances our overall return on net assets?
Are we seeing the kinds of returns promised by those who advised investing
in supply chain efforts?
The task of establishing an internal supply chain and measuring its effectiveness
is well illustrated by work done with Zeneca Agrochemicals, now part
of Syngenta. The project piloted a new approach to supply chain management
in the company�s insecticide/fungicide suspended colloids business. Farmers
around the world use these products to guard their crops from infestations by