Technical article
How do companies identify weaknesses in their processes?
Munich – “In 2018, more cars than ever before were recalled to German repair shops due to safety issues,” reports the Handelsblatt. According to the report, the total number of passenger cars was 3.7 million. KBC published its 2018 Recall Report on this topic back in July. So it’s time to take action, but how can companies manage to reduce their recalls? Recalls resulting from poor quality in the final product represent a significant cost driver for companies, with warranty costs skyrocketing. To not only mitigate financial losses but also quickly address the reputational damage and customer frustration caused by recalls, many companies typically resort to short- to medium-term measures, such as product modifications.
However, if companies are to succeed in the long term in preventing such product issues not only reactively but also proactively for future products, the weaknesses in their processes must be systematically identified and continuously optimized.
But why hasn't this happened in companies long ago?
For many companies, reactive problem management has long been seen as a panacea for reducing warranty costs resulting from field issues and recalls. However, product issues are not resolved in the long term—and certainly not across product generations—because the processes repeatedly allow the same or similar errors to occur. The root causes of these product issues thus lie in the failure to optimize processes that could prevent such errors from occurring in the first place.
Modern problem management for processes is therefore the solution.
This company-wide process for identifying process weaknesses is intended to answer the following key questions:
- At what point in the process did the error occur?
- At what point in the process could or should the error have been detected?
Using a company-specific root cause tree that takes into account between 200 and 300 possible generic causes, it is possible to pinpoint the specific, root-cause process weaknesses.
First, the specific root cause tree is defined in collaboration with the client, based on the relevant value-adding and non-value-adding processes as well as KBC’s best-practice experience. This tree includes generic process causes to address the questions mentioned above. In the second step, the specific analysis procedure and associated analysis, control, and reporting tools are developed, for example, based on VBA and Microsoft Excel. This is followed by the rollout of the new processes and initial analyses to identify process weaknesses, for example, in the form of workshops with the functional departments responsible for value-adding and non-value-adding processes.
This ensures that process weaknesses continue to be identified even after the responsibilities have been transferred to line functions.
Please feel free to contact us to discuss “Modern Problem Management for Processes” or “Identifying Process Weaknesses.”
