THE IMPORTANCE OF FOCUS ON PROCESS:

To begin, managing businesses to achieve maximum value requires an understanding
of what is meant by value. There has long been a quantitative approach
to business management based on generally accepted accounting principles. As
the various approaches have matured, they have become much more sophisticated,
especially with the introduction of activity-based costing, balanced
scorecards, and financial dashboards, all of which build on two fundamental
concepts: when you can�t measure it (however that might be), you can�t improve
it, and what you measure generally gets better. We now ask what it is that
delivers goods or services with inherent value from a business or enterprise. It
is a set of focused and coherent processes that bring satisfaction to the consumer.
To improve a business, then, as you change the underlying processes,
each process needs a set of measures which when folded together reflect attainment
of the organization�s goals as well as maximum customer satisfaction �
the essential aims of an advanced supply chain system.
In the quest for such a condition, it has been said that there have been �five
big ideas� in terms of operational management, notably:
Introduction of the moving production line and standardized product by
Henry Ford and Frederick Taylor
Statistical control of quality by W. Edwards Deming
Lean production by Toyota
Theory of Constraints by Eli Goldratt
Process focus by Michael Hammer and James Champy
Of these ideas, process focus is the only one that looks �end to end,� while the
others tend to work on single activities. In the current complicated business
world, you cannot get far by focusing on a single task. Most equipment, for
example, can be relied upon to deal with a single task effectively. On the other
hand, process can be defined as �end-to-end work.� It is an organized group
of related tasks that work together to create value. All supply chain work fits
this description and becomes process work (e.g., �order to cash� or new product
introduction). The redesign of work on an end-to-end basis is central to improvement;
it is the antidote to nonvalue-adding activities. Consequently, process
can have the biggest impact on enterprise operations. Contemporary performance
problems, as a result, are process problems, not task problems. We
must use techniques suited to dealing with the process. This is where simulation
comes in and offers the greatest value.