Three Steps To Ensure Your Organisation Adds Value

value-adding-for-clients2008 taught us thing or two about the importance of making sure that every part of our organisation is adding value.  Organisations, departments and people deemed not be be adding value have been closed and cut as harsh economic times have forced organisations to really look closely at value added.

But, how do you ensure that all parts of your organisation are actually adding value?  What does this mean if you’re in management, HR or training?

PorterValueChain

Porter’s value chain is useful to keep in mind because it focuses on the end product of creating a margin that is ultimately measured as value as determined by customers.  So step one is, really focus hard on how your customers (internal and external) would describe value.  What words would they use to describe your product or service?  What would disappoint them?  How do they actually use your products and services and how is that different from what you may have intended?  Without a sound grasp of what customers actually value, there is little chance of creating an organisation that adds value.

There’s a natural flow in organisations that consistently and reliably create value for customers.  Redundancy is removed, processes are well defined with clear inputs and outputs.  So step two is, draw up a flow of value where there is a distinct logic to how it is delivered to customers.  If something doesn’t fit or can’t be justified in terms of customer value – get rid of it.  Support departments and functions really need to focus on the problems they solve for those who are in the frontline delivery of customer value.  You’ll know you’re in trouble if a disproportionate number of people are employed to meet the needs of regulators and other agencies.

The best value adding organisations have people who know how to define their roles in language that makes sense to customers.  So step three is, create flexible job descriptions that focus on outputs not lists of mindless tasks and procedural nonsense.  What you want is staff who are clear about “why” they do what they do.  You want them junking policies and procedures that are out dated or that actively destroy value.  Thinking through what would be lost if you did without a particular job role is useful in directing attention to value adding activity.

Let me know what you think about these three steps.  What are the “real life” challenges and blocks?

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