SOURCE: Kay Sever | August 30, 2023
In January, 2023 I introduced the term “organizational dynamics” as a key factor in optimization success. Dynamics is defined as the science of the motion of bodies and the action of forces in producing or changing their motion. If we apply this definition to business, “bodies” are individuals or groups in a company and dynamics refers to how these individuals or groups act, react and interact in the workplace. This is Part 4 of my article on an invisible dynamic that hinders or prevents optimization… managing interdepartmental touchpoints.
Interdepartmental Touchpoints – The Space between Connected Boxes on an Organization Chart
Each box on an organization chart is assigned to a person with management responsibilities. The spaces between boxes represent upstream/downstream working relationships between departments/groups. I call these spaces “interdepartmental touchpoints”.
You may be thinking “I have been in many meetings where we talked about boxes on an organization chart. We never discussed the space between the boxes. Why is this important to focus on?”
That is a good question. Let’s talk about some answers that link interdepartmental touchpoints to financial performance and corporate culture.
- The quality of working relationships between departments greatly affects
- A production value stream’s efficiency and profitability.
- The characteristics of a company’s corporate culture (proactive, reactive, etc.)
- If interdepartmental relationships are weak,
- Equipment utilization will be lower than it could be and rework/excess costs abound.
- Communications are not value-added and problems are harder to solve.
- Silos form and managers protect departments instead of the needs of the value stream.
- Employees may mistrust management and management credibility is low.
- Companies can suffer material losses and not understand what caused them.
Based on this information, weak interdepartmental touchpoints have a big impact on a company’s success. So…who’s got your touchpoints? Most of the time, the answer is “no one”. Why is that?
A wide-spread lack of awareness of points 1 and 2 above causes executives, leadership teams, middle managers and department heads to NOT prioritize or actively manage interdepartmental relationships as part of their profit strategy. As a result, executive teams and site management teams
- Assign a manager to every box on an organization chart, but OVERLOOK accountability for the touchpoints because they are unaware of how touchpoints affect performance and profit.
- May acknowledge weaknesses in their organizations and may suspect the weaknesses are causing financial losses, but don’t know how to calculate or eliminate the losses.
Using data that reflects the quality of interdepartmental touchpoints
It is possible to develop data that quantifies the effectiveness of interdepartmental relationships, then use that data constructively to 1) break down silos, 2) drive “big picture thinking” across departments, and 3) build new partnerships that “change what people fix, measure and talk about”. Last month’s Case Study revealed a material loss caused by a weak touchpoint between a producing site and a corporate department. This month’s case study is about weak touchpoints within a mine start-up process.
Case Study #2: A large mining company followed a start-up process for new operations that over time became disjointed and caused start-up delays, rework and cost overruns. I was asked to lead and coach a 10-member cross-functional team that understood steps in the process and where the breakdowns were occurring. After some analysis, the team determined that on average ½ year and millions of dollars were lost per start-up due to delays, rework and slow response from contributors.
How were these problems solved?
- The timing of some steps was changed and new steps were added to improve the efficiency of the process but more was required.
- To build commitment to quality work in this process, all the people involved in the process needed to see the “big picture” and understand how their role was crucial to having an efficient cost-effective process that eliminated the losses THEY were unintentionally causing.
- So… we developed a unique roll-out strategy for increasing the commitment and quality of work of all departments involved in the process, including external agencies. The roll-out approach I suggested and have used many times with great results is called “Process Orientation”.
For this specific project, the following “Process Orientation” work plan was designed and executed:
- We quantified the losses linked to avoidable delays and rework.
- We built two matrices that reflected process steps, losses/delays and contributors.
- We shared the matrices internally in a group setting with all participating departments and the executive in charge of mine start-ups in attendance.
- It was the first meeting of its kind in the company’s history.
- The most common reaction from attendees was “I did not know how important my part in the process was to the outcome. Now that I know, I will give this process a higher priority”.
- The entire group agreed to act as a team to streamline the start-up process and eliminate the losses… a real victory for the company!
- We also shared the matrices with designated representatives from external agencies so they could see their role in the “big picture”.
- The agencies gave us very positive feedback and committed to work as a partner to help shorten the timeline for mine start-up.
- One agency representative liked our process so much that they were going to take a similar approach to improve the workflow inside the agency.
When did the company start receiving the benefits from this work? Immediately with the next start-up.
In closing, there are many uses for data that quantifies the quality of touchpoint relationships. Once you have this data, Process Orientation can be used as a tool for intentionally managing interdepartmental touchpoints and preventing/eliminating the losses that occur when touchpoints are broken.
There is a management tool that will help build and sustain the kind of working relationships between departments that you expect and need in an organization, especially if you want to optimize performance. Process Orientation drives a company towards an optimized outcome by SIMULTANEOUSLY 1) raising awareness about the cost of problems, 2) increasing urgency to fix problems, 3) building commitment to quality, and 4) improving profit without investing capital.
Thought for the year: There is an astounding lack of management awareness about the power of moments… moments when opportunities to capture millions of dollars hang in the balance… moments when courage is the defining factor in preventing or stopping losses and shaping a corporate culture capable of sustaining optimization over the long term. Executives and management teams that have this awareness are empowered to help their people achieve optimization and accomplish great things!
Kay Sever is an Expert on Achieving “Best Possible” Results. Kay has 25+ years of experience working in the optimization arena. She helps executive and management teams tap their hidden profit potential and reach their optimization goals. Kay spent 3 years analyzing the impact of management systems on optimization success. As a result of that study, she developed a LIVESTREAM management training system for Optimization Management called MiningOpportunity – NO TRAVEL REQUIRED. See MiningOpportunity.com for her contact information and training information. Email Kay directly at [email protected].
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Kay has worked side by side with corporate and production sites in a management/leadership/consulting role for 35+ years. She helps management teams improve performance, profit, culture and change, but does it in a way that connects people and the corporate culture to their hidden potential. Kay helps companies move “beyond improvement” to a state of “sustained optimization”. With her guidance and the MiningOpportunity system, management teams can measure the losses caused by weaknesses in their current culture, shift to a Loss Reduction Culture to reduce the losses, and “manage” the gains from the new culture as a second income stream.
