Building effective business systems. Chapter 2.1 Business Processes: Vocabulary. Stream approach. Business and pipelines
As promised, I begin to lay out the second part of the "manuals." In this fragment, the general principles and approaches, on which I rely in all further reflections and conclusions.
Building effective business systems. Chapter 1: Introduction
Incoming flow - a flow originating outside the company and ending within it.
Internal flow - the flow that begins and ends within the company.
The outgoing flow is a flow starting within the company and going outside.
Cash gap - the lack or absence of working capital from the company. The situation when “as a whole” the money will soon appear, but at the moment there is zero at the box office.
For ease of understanding of the approach, I propose to look at the company from a distance. In the literal sense. If you leave the office and move away to 500 meters, then the company’s activities will look very simple: customers who are concerned about their problems come into the office, but are satisfied.
Figure 1. The company's work from a distance of 500 m.
If we forget everything we know about our company, then it looks like a kind of system, the main function of which is “to make customers happy”. In simplified form, it will look like this:
Figure 2. The scheme of the company.
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But we agreed that the company's goal is money! Therefore, I propose to come a little closer, and we will see that the client carries his own funds to the company, and carries away the finished product:
Figure 3. Where did the money in the company.
These simple diagrams have one goal: to illustrate the streamline nature of our work. We process the flow of customers, transforming this flow and transforming, release the flow of satisfied customers. Understanding of threading in business is very important because it allows us to see the interconnections and mutual effects on each other of different elements of our system. The company has a lot of flows: incoming customer flow, incoming flow of materials, internal flow of documents, internal flow of blanks and semifinished products, outgoing cash flow, outgoing flow of employees. In the diagram above, four streams are marked: incoming customer flow, outgoing customer flow, and internal product and money flows.
If you already grasp the essence of the approach and read the dictionary, then you must object: “But the flow of money does not originate within the company, it is also external!” In this situation, I completely agree that the scheme should be corrected, bringing the beginning of the cash flow beyond the organization and separating money from the client. And in our life everything is like this: we are talking to some people, and others transfer money to us. The conditions are set by the marketer, and the account is signed by the accountant; the owner chooses the color, and the general contractor makes the payment.
If we are to be completely accurate, then the product should also be separated, since it is extremely rare that we bring our designs and products to the office to the person with whom we agreed on their appearance. The final flow chart of our company is as follows:
Figure 4. Corrected flow diagram.
Further, when you see an arrow on the diagram, know that it means flow. And it is important to understand very clearly where it originates, where it ends and who controls it. It is through flows (materials, money, information) that all links of our system are connected.
No, in this section we will not discuss how to properly organize the supply of water to our office, but we are still talking about flows. Let's remember what our company looks like in terms of departmental structure:
And now, knowing that our company processes streams, let us try to depict the scheme of the company’s operation in terms of the flow structure. In this case, we will assume that each of the departments is a reservoir, and the flows connecting them are pipes. In the end, we need to get some system in which customers and money fall, and finished products come out.
The first incoming stream is the flow of customers with needs. Obviously, it starts somewhere in the market, and ends in the sales department, because it is the place where customers turn. The sales department transforms the flow of customers, “pulling” requirements out of them and sending them to expect the finished result. Thus, we have the first internal flow (by the way, informational) - the flow of customer requirements. It begins in the sales department and follows into Production Management, in order to turn into a technical assignment for production, sent to the workshop (fix, again the flow conversion: “customer requirements” goes into “technical assignment”).
In order for the terms of reference to be accurate and reasonable, the Production Manager must interact with the design department and the designer. I suggest calling the name and content of the streams as a warm-up independently. No, really, what do you think, what flows are circulating in the mini-system Designer-Production Managers-Project Department?
The workshop according to the technical task must perform the work, producing the finished product required by the client. To do this, the shop must first send a stream of materials for work. Materials - incoming flow. For materials you have to pay, therefore, there is an outgoing cash flow for materials. Next to him should be an internal cash flow to pay for our workshop. Obviously, the accountant is in charge of spending money. By the way, in order for him to have what to spend, I suggest that we remember that we have an incoming cash flow.
If you are already entangled in the streams, then I suggest looking at the diagram on the next page. It is very important to understand that Figure 5 shows the ideal diagram, that is, HOW CAN BE (or “to be” in terms of describing business processes). We will talk about how it actually happens a little later.
Figure 5. The ideal flow pattern.
In the diagram above, all streams are divided into three types:
Hereinafter, this marking is used as standard.
Of course, the presented scheme is greatly simplified, since there are no cash flows for all departments, there are not enough information flows, but we single out, first of all, those that make the company unique. Salary is paid everywhere, and intermediate meetings are also arranged everywhere. The diagram shows a unique combination of pipes and tanks, which creates the system we need.
The next step in processing such schemes and building real effective companies on their basis is a mathematical calculation for each stream. It is vital to know and understand the speed with which flows flow through each of the links of the organization. Why exactly, we will look further.
Building effective business systems. Chapter 1: Introduction
Business processes
Vocabulary
Incoming flow - a flow originating outside the company and ending within it.
Internal flow - the flow that begins and ends within the company.
The outgoing flow is a flow starting within the company and going outside.
Cash gap - the lack or absence of working capital from the company. The situation when “as a whole” the money will soon appear, but at the moment there is zero at the box office.
Stream approach
For ease of understanding of the approach, I propose to look at the company from a distance. In the literal sense. If you leave the office and move away to 500 meters, then the company’s activities will look very simple: customers who are concerned about their problems come into the office, but are satisfied.
Figure 1. The company's work from a distance of 500 m.
If we forget everything we know about our company, then it looks like a kind of system, the main function of which is “to make customers happy”. In simplified form, it will look like this:
Figure 2. The scheme of the company.
')
But we agreed that the company's goal is money! Therefore, I propose to come a little closer, and we will see that the client carries his own funds to the company, and carries away the finished product:
Figure 3. Where did the money in the company.
These simple diagrams have one goal: to illustrate the streamline nature of our work. We process the flow of customers, transforming this flow and transforming, release the flow of satisfied customers. Understanding of threading in business is very important because it allows us to see the interconnections and mutual effects on each other of different elements of our system. The company has a lot of flows: incoming customer flow, incoming flow of materials, internal flow of documents, internal flow of blanks and semifinished products, outgoing cash flow, outgoing flow of employees. In the diagram above, four streams are marked: incoming customer flow, outgoing customer flow, and internal product and money flows.
If you already grasp the essence of the approach and read the dictionary, then you must object: “But the flow of money does not originate within the company, it is also external!” In this situation, I completely agree that the scheme should be corrected, bringing the beginning of the cash flow beyond the organization and separating money from the client. And in our life everything is like this: we are talking to some people, and others transfer money to us. The conditions are set by the marketer, and the account is signed by the accountant; the owner chooses the color, and the general contractor makes the payment.
If we are to be completely accurate, then the product should also be separated, since it is extremely rare that we bring our designs and products to the office to the person with whom we agreed on their appearance. The final flow chart of our company is as follows:
Figure 4. Corrected flow diagram.
Further, when you see an arrow on the diagram, know that it means flow. And it is important to understand very clearly where it originates, where it ends and who controls it. It is through flows (materials, money, information) that all links of our system are connected.
Business and pipelines
No, in this section we will not discuss how to properly organize the supply of water to our office, but we are still talking about flows. Let's remember what our company looks like in terms of departmental structure:
- Accountant,
- CEO,
- Designer,
- Supply department,
- Sales department,
- Project department,
- Production,
- Production Management.
And now, knowing that our company processes streams, let us try to depict the scheme of the company’s operation in terms of the flow structure. In this case, we will assume that each of the departments is a reservoir, and the flows connecting them are pipes. In the end, we need to get some system in which customers and money fall, and finished products come out.
The first incoming stream is the flow of customers with needs. Obviously, it starts somewhere in the market, and ends in the sales department, because it is the place where customers turn. The sales department transforms the flow of customers, “pulling” requirements out of them and sending them to expect the finished result. Thus, we have the first internal flow (by the way, informational) - the flow of customer requirements. It begins in the sales department and follows into Production Management, in order to turn into a technical assignment for production, sent to the workshop (fix, again the flow conversion: “customer requirements” goes into “technical assignment”).
In order for the terms of reference to be accurate and reasonable, the Production Manager must interact with the design department and the designer. I suggest calling the name and content of the streams as a warm-up independently. No, really, what do you think, what flows are circulating in the mini-system Designer-Production Managers-Project Department?
The workshop according to the technical task must perform the work, producing the finished product required by the client. To do this, the shop must first send a stream of materials for work. Materials - incoming flow. For materials you have to pay, therefore, there is an outgoing cash flow for materials. Next to him should be an internal cash flow to pay for our workshop. Obviously, the accountant is in charge of spending money. By the way, in order for him to have what to spend, I suggest that we remember that we have an incoming cash flow.
If you are already entangled in the streams, then I suggest looking at the diagram on the next page. It is very important to understand that Figure 5 shows the ideal diagram, that is, HOW CAN BE (or “to be” in terms of describing business processes). We will talk about how it actually happens a little later.
Figure 5. The ideal flow pattern.
In the diagram above, all streams are divided into three types:
- Material (orange) - flows of physical objects that can be counted, touched, weighed.
- Cash (green) - cash flow.
- Information (blue) - the flow of information. Of course, they can (and MUST!) Be transmitted in a material form, but for them the form is not important: it can be a file, a piece of paper, words.
Hereinafter, this marking is used as standard.
Of course, the presented scheme is greatly simplified, since there are no cash flows for all departments, there are not enough information flows, but we single out, first of all, those that make the company unique. Salary is paid everywhere, and intermediate meetings are also arranged everywhere. The diagram shows a unique combination of pipes and tanks, which creates the system we need.
The next step in processing such schemes and building real effective companies on their basis is a mathematical calculation for each stream. It is vital to know and understand the speed with which flows flow through each of the links of the organization. Why exactly, we will look further.
Source: https://habr.com/ru/post/143231/
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