How to Build a Continuous Improvement Model for Your Business
Continuous improvement is a hallmark of innovative and agile companies. By definition, it’s the ongoing effort to improve an organization — its products, services, tools, processes, workflows and more. The end goal? To always be in the process of getting better.
With steady state a goal of the past, companies are looking to continuously improve to evolve alongside new trends, stay ahead of technological advancements and remain competitive.
Unlike transformation initiatives, continuous improvement models aren’t bound by specific projects or timeframes. Instead, they become embedded in a company’s culture — a constant driver that keeps the organization moving in the right direction.
As a recent McKinsey article put it aptly:
“Continuous improvement is an ongoing effort to improve all elements of an organization — processes, tools, products, services, etc. Sometimes those improvements are big, often they are small. But what’s most important is that they’re frequent.”
In order to achieve this, companies need continuous improvement models that provide frameworks for execution. In this article, we’ll discuss how you can build a model designed for your organization and unique business needs.
- Before implementation, continuous improvement requires knowing your current state, mapping your target state, and identifying the gaps between the two.
- Popular continuous improvement frameworks used by businesses today include Plan, Do, Check, Act (PDCA), Six Sigma, and Total Quality Management.
- Accountability for continuous improvement efforts can be maintained with strong communication, defined KPIs, and frequent performance measurement.
- Continuous improvement models thrive on momentum — always celebrate wins publicly and build on success.
Building a Continuous Improvement Model in 7 Steps
Know your current state
The first step toward successful continuous improvement is to know the current state of your organization. Your current state includes every process and resource you use to operate — the people, infrastructures, workflows, and tools that keep your company running.
First, take inventory of these components. Then, create visuals to map relationships between them: for example, the partnership across two business functions or the integration of multiple IT tools. The goal is to not only see what exists within your organization but also understand how it all interacts to create a functioning business.
Performing a current state assessment typically involves a designated team with representatives from different departments and teams — people with diverse perspectives that can help build a holistic representation of your business.
Build target states
As mentioned before, continuous improvement models don’t have hard deadlines — they exist as a permanent part of your company’s way of operating and culture.
That means your goals will also evolve and are best developed in the form of target states. Just as you built your current state architecture, envision what your company will look like in the future: one, five, ten or even 20 years ahead. Build a visual representation of what your target state looks like, and identify gaps between your current state and target state.
From there, you can begin setting goals. A central tenet of continuous improvement is to start small and build on success, so begin with goals to accomplish by the nearest time frame (i.e. one year from now) and expand on those to develop longer-term goals. Keep your goals flexible and remember that they will (and should) evolve over time.
Choose the right framework
You don’t have to reinvent the wheel when it comes to continuous improvement models and frameworks — plenty exist already that are tried and tested. Three of the most common (and effective) are:
- Plan, Do, Check, Act (PDCA) – Tests solutions on a small scale, then improves them before large-scale implementation
- Six Sigma – Follows five steps (define, measure, analyze, improve, control) to achieve process improvements
- Total Quality Management (TQM) – Customer-focused method aimed at making data-driven decisions to increase efficiency
Many continuous improvement frameworks are built on shared principles, and much of the time the model you choose is simply a matter of preference for execution. The important thing is to align the model with your actual business, processes, and goals.
Share your plan with all internal stakeholders
Now that you’ve completed your current state assessment, target state maps, and continuous improvement frameworks, it’s time to share the plan with all internal stakeholders. This usually means all employees. Everyone at your company will need to contribute in some way, in order to truly achieve a continuous improvement culture.
Building morale around continuous improvement efforts is critical, so present your plan as an opportunity for everyone at your organization. As much as you can, focus on specific value it can add for each team, department, or business unit (i.e. what benefits will they enjoy from the impacts of continuous improvement).
Gaining buy-in this way at the start positions your plan for better success long-term.
Establish a culture of accountability
Accountability is essential for continuous improvement to take effect. Given that changes are small and incremental, there’s no way to really tell when they’re happening without a defined process for measuring accountability.
The good news is that it doesn’t have to be complicated. Accountability can be achieved by:
- Outlining goals and processes clearly — in writing
- Defining who is responsible for what
- Identifying the KPIs you’ll use to measure success
- Reporting frequently on progress
- Meeting to discuss progress and challenges
These steps help your teams keep continuous improvement goals top-of-mind so that they’re prioritized day-to-day, provides a transparent view and shared understanding of progress, and offers a place to communicate openly about wins and challenges throughout the process.
Celebrate wins along the way
Continuous improvement models and cultures thrive on momentum. While it can take time in the beginning, once results start showing, your teams will be more motivated to uncover new opportunities to improve.
As you achieve small wins that move you toward your target state, celebrate them publicly and give credit where it’s due. Continue to emphasize the business value these small wins add to your business and for your employees and customers.
Over to You
Optimizing your mission critical workloads is one of the surest ways to drive continuous improvement at your organization, and Protera can help you do it. Our SAP managed services help clients run applications on AWS or Microsoft Azure with lower costs, higher quality, and greater agility. Read further on this topic in our dedicated post on SAP Continuous Improvement.
Learn more about Protera’s SAP Managed Services or schedule your virtual solutioning session today.