Tag Archives: how to increase value-added work

How to Devote More Resources to Value-Added Work

Our previous post defined the concept of “value-added work” as being work our customers would be willing to pay for if they knew what we were doing. That post also noted it is common for 50% – 80% of all work within an organization to be “non” value-added!

Here are four ways to devote more resources to increasing the amount of work that is value-added within an organization:

1 — Work On The Bottlenecks
When we work on many things that have a small effect, we will have a small impact. The way to increase value most substantially is to work on the bottleneck, or constraint. All improvement effort that is off the critical path will have a lower impact on increasing the value add. If the bottleneck can be widened even just a little, it provides a pure increase in value.

2 — Increase Understanding of And Alignment With What Customers Truly Value
One of the biggest wastes is when the products or services we offer do not align perfectly with the customers’ needs and values. Errors are possible in two directions:

  • Bundling a feature into the product or service that the customers do not really need or want
  • Overlooking ways we could leverage our capabilities to solve a problem that the customers may not even have articulated to themselves

3 — Get At The Root Causes
Replace the constant working on problems and symptoms with lasting solutions by drilling down to root causes. For example, the sales force of one company needed to better understand the value of additional services they could provide to customers. Rather than addressing the issue / opportunity in each proposal, they developed a calculator to make it quick and easy to help the customers (and themselves!) see the value provided by the additional services.

Another example is data accuracy issues in software that helps a company develop routes for drivers. Any error in the data input will create errors in the routes — inefficient or even impossible routes. The underlying cause is errors in the data input, but the root cause is somewhere in the process through which the correct data should be identified and entered. Studying the input process to identify where and how errors are made will help lead to and address the root causes and greatly reduce the amount of resources NOT creating value for the customers.

4 — Eliminate The Non Value Adding Administrative Work
A great deal of time in most organizations is spent on emails, meetings, and reports that do not produce additional value for the customers or the organization. Finding ways to reduce email clutter, improve meeting management, and streamline reports are just a few examples of how this non-value-added work can be reduced or eliminated.

How Much of Your Work is Value-added?

Most of us would likely agree that we want our workforce to spend most if not all of their time on “value added” work, which is often defined as the work our external customer would be willing to pay for, if they knew what we were doing.

But studies indicate that even in the ‘best performing’ organizations, “value-added work” is well under 50% of the work being done!

Consider the following examples of “non-value-added” work:

  • Inspections to find errors
  • Rework to fix errors
  • Errors or defects that are never found and make their way into a defective final product
  • Work that sits waiting in front of a bottleneck, or resources that are idled behind a bottleneck
  • Unnecessary work
  • Excess inventory
  • Work product that does not match customer needs or customer needs that go unmet because they have not been surfaced.

If this list is a familiar one, you’re not alone… and while this list could go on, the point is that there is a huge opportunity for improvement for most of us if we could simply convert just some of the non-value-added work into pure value-added work.

Simple… but not easy!

Assuming we conduct an honest assessment of all work processes, here are four ideas for increasing the amount of value-added work:

  1.  Work on the bottlenecks
  2. Increase understanding of/ alignment with what customers truly value
  3. Identify root causes of errors, defects, etc.
  4. Eliminate non-value-adding administrative work such as unnecessary email, unproductive meetings, or reports that do not produce additional value for the customers or the organization

Read the full article…

How to Make Work More Value-Added

valueadded22Given that value-added work is “the work our customers would be willing to pay for if they knew what we were doing,” the core value- add of an organization’s leadership is to study and improve the system of work and to maximize the amount of work that is value-added.

By using the insights and information of people doing the work and knowledge about improvement tools and methods, a manager can improve the system of work so that everyone’s performance improves, more value is created, and the organization becomes stronger and more profitable.

Here are four ideas to increase the portion of resources that are directed at value adding activities:

  1. Work On The Bottlenecks – When we work on many things that have a small effect, we will have a small impact. The way to increase value most substantially is to work on the bottleneck, or constraint. If the bottleneck can be widened even just a little, it provides a pure increase in value.
  2. Increase Alignment With What Customers Truly Value – One of the biggest wastes is when the products or services we offer do not align perfectly with the customers’ needs and values. Errors are possible in two directions.
    • Bundling a feature into the product or service that the customers do not really need or want.
    • Overlooking ways we could leverage our capabilities to solve a problem that the customers may not even have articulated to themselves.
  3. Get At The Root Causes – Instead of  working on problems and symptoms, drill-down to root causes so that lasting solutions can be found.
  4. Eliminate The Non Value Adding Administrative Work – A great deal of time in most organizations is spent on emails, meetings, and reports that do not produce additional value for the customers or the organization. By taking proactive steps such as reducing inbox clutter or introducing meeting effectiveness practices, an organization can reduce waste and quickly boost people’s capacity to perform more value-added work.

By tackling these four things — the bottleneck, understanding and alignment with what the customer really values, the root causes and the non-value adding administrative work — any organization should be able to greatly increase the value content of the work.

Read the full article…

How to Reduce Non-Value-Added Administrative Work

valueadded22As noted in our previous post, a great deal of time in most organizations is spent on emails, meetings, and reports that do not produce additional value for the customers or the organization.

Here are several approaches to reducing this waste:

Reduce clutter in the inboxes

  • Reduced use of Reply All
  • Use sorting technology, like that available in Outlook, to separate out urgent emails that should ‘interrupt’ from those which can be read and addressed at regularly scheduled intervals

Introduce meeting effectiveness practices:

  • Clear objectives and agendas
  • Active facilitation
  • Documentation of decisions and of action items and due dates
  • Making sure each attendee has a clear role or purpose at the meeting, or is not requested to attend

Streamline reports:

  • A number of reports in most organizations will have redundancies; sometimes a report will have some but not all the information required, so a new report is designed to provide the full picture. This happens again and again until there are numerous reports that seem to report similar information. Sometimes similar but different information is misinterpreted creating more waste. Sometimes reports are compared and present different numbers — then someone must run down the differences. Reports can drive a great deal of waste in an organization.
  • One organization used the 5S method with their management reports to great effect. They tackled the full inventory of management reports — about 900. First they sorted the reports in their management reporting system into two groups: reports that seemed to be actively used and reports that had grown obsolete. They moved over 700 reports into deep storage — to be eliminated after six months of no inquiry. They then created a system of organization and put each report in its place. One of the reasons the number had grown so large was that when a manager could not find the report he or she needed, a new one would be developed. This helped address one root cause of report proliferation. The team cleaned up the reports to get rid of extraneous data. They then standardized the report requesting and creating process, and are working on sustaining the new process.

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4 Ways to Increase Value-Added Work

valueadded22Now that we have established the core value-add of a manager is to study and improve the system of work, and that by eliminating the root causes of the “debris and impediments” leaders can enable the workforce to spend more time creating value and making more money, we can move on to sharing ideas on “how” to do so.

Here are four ideas to increase the portion of resources that are directed at value adding activities:

  1. Work On The Bottlenecks. When we work on many things that have a small effect, we will have a small impact.  The way to increase value most substantially is to work on the bottleneck or constraint. All improvement effort that is off the critical path will have a lower impact on increasing the value add. If the bottleneck can be widened even just a little, it provides a pure increase in value. 
  2.  Increase Understanding of And Alignment With What Customers Truly Value. One of the biggest wastes is when the products or services we offer do not align perfectly with the customers’ needs and values. Errors are possible in two directions.
    • Bundling a feature into the product or service that the customers do not really need or want.
    • Overlooking ways we could leverage our capabilities to solve a problem that the customers may not even have articulated to themselves.
  3. Get At The Root Causes. Replace the constant working on problems and symptoms with lasting solutions by drilling down to root causes.
  4. Eliminate The Non Value Adding Administrative Work. A great deal of time in most organizations is spent on emails, meetings, and reports that do not produce additional value for the customers or the organization.
     
    The amount of non-value-adding administrative work that can be found in most organizations is so varied and so large that we will share several specific ideas for seizing this opportunity for improvement in our next post.

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Value-added Work & Management’s Core Value-add

valueadded3Continuing our theme of “value-added” work, which in our previous post we defined as “the work our external customer would be willing to pay for if they knew what we were doing,” today’s post focuses on the first steps an organization might take to increase the percentage of total work that qualifies as being value-added.

It’s important to recognize at the outset that while customers may be willing to pay the price we ask, all of the waste is still on our dime!

And… every bit of waste that we eliminate can be taken right to our bottom line!

Many people and functions play a vital role in helping the internal customer provide value for the external customer. These are the folks on the edge of the value stream; some of them might provide key enablers such as technology, safety, or information to those creating the value for external customers, and some might remove the ‘debris’ (through inspection and rework) or impediments (through process improvements) to the swift flow of value to the external customer.

If we can eliminate the root causes of the “debris and impediments,” then the time we save can be redeployed to creating more value and making more money.

The core value-add of a manager is to study and improve the system of work. By using the insights and information of people doing the work and knowledge about improvement tools and methods, a manager improves the system of work so that everyone’s performance improves, more value is created, and the organization becomes stronger and more profitable.

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Increasing Value-Added Work in Your Organization

valueaddedMost of us would likely agree that we want our workforce to spend most if not all of their time on value added work, which is often defined as the work our external customer would be willing to pay for if they knew what we were doing.

But you might be surprised at the amount of “non-value-added” work that is part of the day-to-day reality in most organizations. In fact, in most organizations, over 80% of time and resources are not adding value!

A few examples:

  • inspections to find errors
  • rework to fix errors
  • errors or defects that are never found and make their way into a defective final product
  • work that sits waiting in front of a bottleneck, or resources that are idled behind a bottleneck
  • unnecessary work
  • excess inventory
  • and perhaps the biggest waste of all, work product that does not match customer needs or customer needs that go unmet because they have not been surfaced

In other words, non-value-added work represents a huge opportunity for improvement if we could convert just some of the non-value adding resources into pure value add for the customer!

We will discuss this concept further in upcoming posts, and welcome your thoughts on how your organization has been able to increase the percentage of value-added work being done day-in and day-out.

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