The Secret Life of the Firm

Written by
inverbis analytics
1 de November de 2021 Max 3 min read

The Secret Life of the Firm is a hidden ghost that quietly casts a shadow over the waste and rework that undermines the execution of operations and profitability.

Procedures and KPIs explained on power-point are cheap, achieving the expectations of our planned performance is a quite different issue. Nothing new under the sun, but nowadays bridging the gap between what we expect to achieve and the actual execution is a critical goal for any organization.

Some companies do have documented procedures and operational handbooks. Many others don’t. Either way procedures exist, they may be a formality that does not work properly or just the old way we do things here. Whatever the circumstances, most of the organizations ignore the cost of not doing things the right way at the very first attempt.

KPIs show a synthetic metric of how well our business has performed its procedures. Since at present we can grab data of everything and measure everything, the complexity does not lay on getting the figures, but understanding what actually happened to achieve that number. Moreover, because we ignore the path to reach our targets, we assume KPIs goals that undercover undesired ranges of variance, accepting inefficiency.

Processes are not just processes. The process is the actual execution we perform of them. This includes the expected path, planned but not desirable paths (let’s admit it, most of the calls to our contact center should not occur if procedures are performed as intended), and unexpected paths we even do not know about sometimes.

Therefore, we meet KPIs targets on average, but as every distribution behavior explains, there are values under and over the average. Is this suggesting that everything over the average means that a better way of doing things is actually possible, and that everything under the average means an improvement is possible? Yes, reducing variance and improving the average is possible.

The Secret Life of The Firm is a compound of unnecessary repetitions of tasks, reworks, activities with zero value and controls due to our own lack of control that we execute in order to get the expected output. The Secret Life of the Firm is the time we spend and the cost we incur in correcting mistakes and defects from third party agents or our own organization errors. The cost of no quality is a ghost hidden by our own lack of light and vision.

Process Mining is the most advanced tool that has been created ever to discover the actual execution of organizations and therefore find The Secret Life of the Firm,

  • Process Mining discovers how many times and in which situations we do not meet the expected performance…
  • …brings light to rework. Shall we insist on how costly it is repeating tasks that were not performed the right way at the very first attempt?
  • …measures how much we can improve. InVerbis experience shows that the expected performance does not occur in extremely high percentages and how much this increases cost.
  • …reduces complexity. Lots of companies have found thousands of single paths to execute the same procedure. Obviously, most of those paths were not in any handbook, they do happen because the organization has created alternatives to solve unexpected situations that the manual did not consider or because of the obsolescence of methods, tools or IT systems.

Discovering The Secret Life of the Firm is achievable and provides a fast return on investment. Thanks to Process Mining, organizations obtain accurate information on how operations have been executed, learning which paths and sequences of activities have provided or subtracted value. Data to give those answers are already living inside corporations IT infrastructure. Management leaders just need to decide they want to start reducing waste, cost and improve efficiency. InVerbis is the right companion to this endeavor.

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