Transcript:

Mark Robinson – The importance of Business Processes

Doug D’Argenio:          Welcome to the PS Insights podcast series sponsored by Kimble Applications. Professional services organizations strive for efficiency, success, and growth. This series is intended to provide key insights on how to achieve this from industry leaders.

Frances Fawcett:         Hello, my name is Frances Fawcett and today I’m talking to Mark Robinson about the importance of business processes.

Mark is co-founder and Chief Marketing Officer of Kimble Applications. He has over 30 years experience in the IT sector, which has included working in Oracle Corporation in its very early days, where he witnessed a rise from start-up through to software giant.

He started his first IT consultancy company in 1997, without external investment, and by the time it was sold three years later, it had grown to 200 people in offices in the UK and the US. He then co-founded a further IT consultancy, which was sold some years later after growing to over 400 people based in the UK and India.

Hello Mark.

Mark Robinson:           Hi there.

Frances Fawcett:         You told me earlier that the business guru John Harvey Jones once said that, “No one goes to work wanting to do a bad job, but we put so much red tape in their way that they, they give up trying to do a good job.”

Some of that is about processes. So, why do we have the specific processes that we have?

Mark Robinson:           Well for me, it’s about a number of things. First of all, it’s about driving consistent behavior. And if you drive consistent behavior, you’re more likely to get consistent outcomes for your business. I think for me as well, and one of the challenges of growth is that there are basically not enough experienced people to go around, so you’re always gonna be given people, if you’re growing, something they’ve not done before. Or they’re learning effectively on the job.

If you give them process, you help guide them. I’m not suggesting everybody follows process rigidly. The analogy I would draw is like a GPS or Google Maps. I don’t know about you, but the way I use Google Maps is when I’m driving my car is, it tells me how to get from A to Z, and along the way, there are various turns I do.

Most of the time, I can remember which way to go, but occasionally I’ll just need that little prompt about what turning I should do, or maybe it’s a bit heavy traffic. Maybe I should go a different way. And I kind of think processes are like that. They’re helping guide you on a journey. If you’re more experienced, there are things that you may cut corners or change things slightly differently, but ultimately, it’s taking you on a journey from the beginning to the end, and if you do that consistently across the business, you can then delegate that to more people.

Frances Fawcett:         Getting that consistency is really important, isn’t it? Because organizations want to give the same quality of service, the same quality of output all the time. Processes can help with that, presumably.

Mark Robinson:           Absolutely. Processes are a way of putting policies into action. They’re actually all about driving behavior. When you are growing an organization, I think it’s very tempting to not empower people in your organization to make decisions. You’re too frightened that if they make a mistake, it effects you. And if you’re running for example, a services business, it can have a real impact on you. One failed project could ruin your brand. It could certainly lose you money. So, unless you’re convinced that people are going to drive things in a consistent way, you won’t let go.

You’ll end up staying in the weeds. You won’t become more strategic, you won’t be able to take more strategic role, and you won’t be able to grow. Because unless you’re empowering everybody across your organization to make those decisions and you can trust them, then you’ll stagnate, then the growth of the organization will be inhibited.

Frances Fawcett:         Processes can therefore give you a way of scaling.

Mark Robinson:           Absolutely. Yeah.

Frances Fawcett:         Within the professional services sector, do you see some key processes and key business process that are important for those organizations?

Mark Robinson:           For consulting organizations, then the sales process is absolutely key. The difference in a services organization to a product business is that in a services organization, your sales are dependent totally on having the resources to actually deliver those services and having them available at the right time. So, it’s not just sales. It’s about being able to resource the sales you do. So, the link between supply and demand and that process is really important.

And that involves understanding when it is in the process you’re actually going to resource. For most organizations, sadly, they will resource once the business is won, or very close to being won, but the trick in growing your organization is to actually resource as early as possible. And that requires a disciplined process for recording what sort of demand is happening in the market and a disciplined process for when you react to that demand and start to look for the resources you need to match that.

That’s the first one. The second one is around the actual delivery of the projects themselves. You need to be able to deliver those projects consistently. You need to deliver them to the margin ideally that you won them at. You need to have a process in place to recognizing early when those projects are going off track so you can do something about it.

And then finally, I think you need a very disciplined process around forecasting. Because for me, if you can get the resourcing piece right, and you get the delivery piece right. Then to measure how good those two processes are, is really how accurately forecasting are. And that’s a great measure of knowing how successful your processes are in those two areas.

Frances Fawcett:         I’m wondering if some of those processes, those key processes that you’ve mentioned, lead to more, further down. Within the delivery part of a project, there has to be a process around change management, and there may be others as well. These all nest into a collection, don’t they?

Mark Robinson:           They do, but I think, my definition of process would be that what you’re trying to do is to do things as early as possible. To spot problems. It’s very much about looking forward, not backwards. I think traditionally, the way people have worked their business is they’re focused on what I’d call the “operational whirlwind.”

They’re focused on the back-end collection of data, how things have performed historically. But if you’re running a services business, what you’re really trying to do, as I said earlier with sales and resourcing, is spot demand early. To areas that maybe new service lines that you should be getting into, where you’re getting demand, but also getting out early of areas which are no longer successful.

From a project delivery point of view, are you spotting where problems are going wrong early enough, and trying to build all your processes around doing that? What I would recommend, think about everything early whether it’s change control. It’s challenging the customer early on whether or not things are changing, and being bold enough to make that change.

Frances Fawcett:         If you have a process in place that fleshes out those unpredictable elements of a project. That presumably makes people better able to manage them, and better able to deliver the right service to the customer.

Mark Robinson:           Another example of that is many years ago in a previous life, we were doing work with a large, engine manufacturer for aeroplanes. One of the things we observed about their process was that they would always try and surface risk early. They recognized that typical project lifestyle, particularly in IT, sadly, is that you kind of do all the easy stuff first, and it’s only at the end when you start to bring everything together, which looks great on your project plan, because you’re delivering probably ahead of plan. Then suddenly something towards the end of the project goes wrong, and you suddenly realize that this is going to cost a lot more money than you expected to fix.

Which the customer is very upset about. What we did in our own experience is we changed our delivery process around, and we decided to tackle all the high-risk items. The pieces, for example, where we were looking to integrating with other systems. We tackled those at the beginning of the project, and sometimes that surfaced a big problem very early.

It surfaced the fact that this project was going to be a lot more expensive than expected, or there was some key dependencies that we have to iron out before we go forward. But the benefit of that was, very little money and effort had been expended at that point. And most times, the customer said, “That’s fine. I’ll spend more money. We understand why there is an issue.” And they were able to raise the budget.

It’s just a lot harder to do that when you’re two weeks from going live.

Frances Fawcett:         You haven’t got the time to mitigate the situation you’ve found yourself in. So that’s a good way of having a process that protects the project and ultimately protects the customer. Is there a way of deciding the right amount of process for an organization? I guess you could have too much, or you could have too little.

Mark Robinson:           Important thing is you don’t want process for processes sake. The other important thing to remember is that processes will evolve. You need a process, if you want to call it that, for actually deciding when you need to change those processes.

When you’re in a start-up, you know, a small organization, in fact, any new organization, and I’m sure from your own experience this is true, you’ll tend to bring around you the people you’ve worked with in the past. And it’s great, and everybody, has that sixth sense between them. You all know what each other are doing. You’ve got some muscle memory of working before.

As you grow, unless you’ve got an incredibly large number of friends that you’ve worked with, you’re going to run out. And that’s the point when you lose control. As I spoke about earlier, you won’t be able to sort of devolve power to other people unless you’re confident they’re going to do the same things in a consistent manner as your friends.

By the same token, you have to make sure that your friends, the people you trust, aren’t bogged down by over process. You do need a way of flexing that and having it be flexible enough so that really experienced people to not feel they’re bogged down, as John Harvey Jones would say, with red tape. But also, that the other people are actually able to be driven in a consistent way to the process.

And I think those processes change. As I was saying, as you get bigger, then you’re going to inevitably need new processes. It might be, when you’re a small organization, you don’t need purchase order cover to go out on site. Because you know the customer you deal with. Maybe it’s someone you’ve worked with many times before, and you trust them that if push comes to shove, they’ll come and bail you out and pay the money.

But as you get bigger, you will have to enforce rules that say, “Please don’t go out on site unless you have purchase order cover.” And be prepared for the consequences that you may lose the business. But ultimately you see the impact of maybe having a project without getting paid, for no fault of your own, can have on your business.

But you’ve learned those mistakes. And that again is an example of process that will change, become more rigorous as you get bigger.

Frances Fawcett:         Having processes in place is perhaps a sign of growing up as a company.

Mark Robinson:           Exactly.

Frances Fawcett:         Have you got any, any stories, examples? What happens when people get it wrong?

Mark Robinson:           What people do is, they do get obsessed by commonality in processes. They’re confusing what they’re trying to achieve. So, an example would be. I’ve put in a lot of financial systems across lots of different countries, and it’s very easy to try very hard to get every part of the process nailed down. But there may be, for legal, cultural, whatever reasons around different countries, reasons why you can’t have a common process in different countries. And what you should do is think about what a common denominator is.

Think about all the processes that are very similar, nail those down, get those right. If you focus too much on the process that, well, just too hard to do, or there are real reasons why they won’t, you’ll end up antagonizing people. Which will mean the key processes you want to get in place won’t actually be absorbed. They won’t become commonalities. The first thing to do is to think about the processes that are common. Get those bedded in, and then maybe start to look at other things. But I think if you get that right, you’ll probably 90% of the, the way there anyway.

Frances Fawcett:         You’re talking about prioritizing the important elements, aren’t you?

Mark Robinson:           I think they’ll be much more clearly articulate. They’ll be much more clearly understood to people. Often people also confuse the systems they use for process. I sometimes talk to customers where they tell me that this is the way they do things. And actually, you find this is the way they do things because of the constraints of the process they used to use.

I’m old enough to remember when I filled into a time sheet, it went into a little orange envelope and a man or a lady would pick it up and take it to somebody else and put it in their in tray. They would sign it off, and it would go to the next person. What we do is, we build systems that mirror that process without the person moving it around.

We don’t think actually what we’re trying to achieve here as an outcome is to get approval, what we’re not realizing is the outcome we’re trying to drive is to make sure that the information that we put down about what expenses we’ve claimed, for example, or what time we’ve done, is accurate so that we can bill the customer. It’s not about moving it between different people in the organization.

Frances Fawcett:         That’s a great example, because what you’re saying is that it’s about being focused on the outcome you’re aiming for, and being open to the idea that the way you do it now may not be the most efficient way of doing it.

But the process should be about achieving the outcome in the most efficient way possible.

Mark Robinson:           Yeah.

Frances Fawcett:         People don’t always like processes, do they? How do companies engage with their staff and help them to understand and see the value?

Mark Robinson:           Well, I think there’s, there’s a number of ways. First of all people have to explain to everybody, make it very clear, what the outcome is they’re trying to derive from the process. And if they can’t do that, then don’t put the process in place.

The second thing is, typically, a process is being driven around trying to drive an action of those people. And if it’s not driving you to an action, then it’s not a proper process from my point of view.

The third part, is what I call “measure what matters.” And sometimes, a process is about gathering information, gathering data, for somebody in the back office, somebody in the organization. And if people don’t realize why that information is important to them or to the company or both, ideally, then again, people won’t tend to stick to that process. It’ll require a lot of bureaucracy to make that happen.

The other area in terms of doing this, I think, is people need to walk the walk as well as talk the talk. Often, you’ll see leaders in the business defining processes and they’ll be the least adopters of that process. A great example would simply be in terms of using systems, using data and systems.

They’ll go away and build a spreadsheet off system, and expect people who are using the system. And it’s no wonder there isn’t the compliance there should be.

Frances Fawcett:         Once everything’s in place, and everyone’s happily adopting it, what are the benefits of getting it right and having a good, strong set of processes in place?

Mark Robinson:           From a company point of view, then it’s, what I said at the beginning. It’s about driving consistent outcomes. You’re absolutely sure that what you’re expecting to do is what’s gonna happen. It’s gonna happen not just in your own domain, but also in other countries, other divisions, and that allows you to grow.

I think from a people point of view, they learn. We talked about less experienced people. If you’ve got process that becomes part of that muscle memory, then they’re getting more rewarding experience. They’re enjoying what they’re doing more. So, it’s a benefit, not just for the company, but for the individual.

Frances Fawcett:         That’s a great summary, and brings us back to the beginning of that’s how an organization can deliver some consistency, grow, and work effectively for their people.

Thank you, Mark.

You’ve been listening to one of a series of podcasts dedicated to sharing best practices for professional service organizations. These can be found on www.KimbleLabs.com.