Friday, December 17, 2010

More about process improvement project risks

In "Process Part I", I put it to you that business' are run from a vertical--that is, functional--perspective but most process improvement projects attempt to improve the business by improving cross-functional--that is, horizontal--process performance.

Trust and verify

The issue for project managers is to convince stakeholders--most of who have a vested interested in the functional metrics oriented vertically--to trust process metrics that are 'invented' or put in place by the project outputs. Without trust, there will be no meaningful outcomes to justify the effort to develop the outputs.

Schema?

One issue is that to support process metrics business data has to be reorganized. Data gathered functionally--that is, vertically--during the normal course of business activity has to be reported horizontally. That requires reorganizing the data schema. The 'get it in' schema is often too inefficient and ineffective to support the 'report it out' needs of the process.

Enter the data warehouse:

One use of a data warehouse is to store the vertical data from the P&L data base in a horizontal form so it can be read out in a process dimension. However, what appears simple on paper--changing the view of the data--is not simple in practice.

Just the facts!

One principle of system engineering of which project managers are well aware is that "view" doesn't change the underlying facts.  One example familiar to project managers is the WBS: the sum of the horizontals [which is one 'view']  equals the sum of the verticals [which is another view].

The same applies to business data.  In the case of a DW, it should be to sum up horizontally what the P&L database is reporting vertically.

DW project risks

The risk arises in the validation task.  The P&L data is 'certified' and 'validated'; the horizontal process view is not.  Therein is the risk: data transformations, data timing, and query logic all bear upon results.

Project managers are well advised to take this risk seriously. 

It took one of my projects about a year to validate the DW so that it would add up to the P&L reliably.  It's not just a matter of arithmetic.  It takes time, and repeated success, to obtain the trust of stakeholders whose livelilhood may depend on the results.


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