The Secret: Continuously Innovate Best Practices to Next Practices

Financial Management

We all know that we are organized in silos. These silos have names…Purchase, Operations, Accounts, Human Resource Development, and so on.

We have owners for these silos, who are accountable for the performance of their respective silo. Director (Operations), Director (Human Resource Development), and so on.

Career paths are carved within a silo.

Financial goals are set, silo by silo.

These silos are managed with three processes…Financial Planning, Financial Control, Financial Improvement. They service the shareholders and banks!

Quality Management

Who defines Quality? Who is the final inspector? Who pays your salary?

Customer. Customer. Customer.

Where is the customer in the silo model? Outside the organization.

This customer receives output of work that flows horizontally across silos. We call this horizontal work a process.

Owing to the fortress of silos, work faces many battle grounds on its journey to the customer.

There are no owners for processes. So there is no one accountable for the performance of individual processes. This results in processes flowing across the length and breadth of an organizations, as benchmarks for inefficiency and ineffectiveness.

In some organizations, processes are manged with Quality Planning, Quality Control, Quality Improvement. These processes perform Faster / Better / Cheaper than their defined competition.

We need both. Financial Management and Quality Management.

Startups

Unknowingly, startups tend to singularly focus on customers and processes. They are driven by the mantra: Faster / Better /Cheaper / Different.

These startup entrepreneurs are impatient. They benchmark best practices of successful organizations, in a similar space, and innovate the same to next practices for their own organizations.

All this must be done at lightening speed. Their aim is to be the first in the market place. These young entrepreneurs know that there is no consolation prize for being second.

The company life cycles for startups is dependent on singular product life cycles. They dream of a Break Even Point at zero output!

Their Financial Management inputs come from investors; and Quality Management inputs from their sixth sense about the customer.

The risks are extremely high.

Best Practices

Regardless of your business vintage, are your managerial practices being benchmarked? Yes. Good. You are best-in-class.

Do you know your best practices? No. You should harvest your best practices with assessment tools, such as, the BestPrax Barometer or IMC Ramkrishna Bajaj National Quality Award Model. There are several more.

Best practices have a life. They are easily replicated by competitors. The ‘Different’ is easily converted to a Commodity.

Suggestion:

• Harvest your best practices

• Continuously innovate these best practices to next practices..

Track the record of Amazon, and Uber.

Random Thoughts

• Should startups benchmark the practices of craftsmen who built the Taj Mahal?

• The craftsman who built the pyramids in Egypt understood customer needs.

• Survival of the family, for a craftsman, depended on effectiveness with respect to customers and efficiency with respect to the processes.

• The reputation of a craftsman family had to survive several generations.