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2.2.Getting Performance From Process Improvement: Part 3—Improving Performance Through Process Improvement
In the first and second articles of this series, we explored the challenges faced in linking process improvement to business performance, and what it means to improve process. This article will help you begin to understand how to structure, at least qualitatively the connection between process improvement and business performance improvement. This article does not get into the math and statistics of process performance models (PPMs) or the number crunching that you would employ in statistical process control; it starts out more fundamental than that. Numbers lead to answers, but before you can seek answers you first need to know what questions to ask; this series will help you begin to form those questions.
Prior to the industrial age, much of an enterprise’ success was dependent upon factors beyond the control of the people running the business. If your enterprise was farming, your success was in great part dependent upon the weather of the growing season. If you were a merchant, your success was dependent upon market forces (or tradewinds or pirates) that could not have been systemically seen or understood in the times. However, since the beginning of the industrial age and into the information age, there have been exactly three things you could do to improve business performance:

1. 
   Improve workers by improving their knowledge and skills and thus, presumably their efficiency and efficacy
   
2. 
   Improve technology
   
3. 
   Improve process
   

At the core of all improvement initiatives, what the organization is really trying to do (or should be trying to do) is make improvements in one of these three areas. Perhaps not understanding this causes many organizations to not achieve their improvement objectives; they don’t know exactly what it is they’re really trying to improve. You may say you want to improve "time to market," but why? (See the first article in this series.) And once you figure that out, figure out what it is you’re trying to improve about time to market: workers’ skills and knowledge, technology, the processes, two of the three, or all three? Simply put, you have little chance of measuring improvement if you don’t understand what you’re trying to improve. And you have very little chance of understanding how your million dollar improvement initiative affected business performance if you don’t understand the relationships between the three forms of improvement and organizational performance.
A lack of understanding of the relationships between people, process and technology also muddies the water when it comes to reporting results from improvement initiatives, and it enables organizations to make unsubstantiated claims of "success" from their process improvement initiatives. It is almost impossible to change and improve process without affecting the other two dimensions. If I improve my process, I then have to train people in their use, thus I’ve improved worker skill. If I’ve use a new web-based interface for access and use of the process representations, have I also not improved my technology? Which improvement yielded the performance results?
Business organizations are not clean-room labs in which we can control all the variables that might influence our improvement experiment. So why aren’t we just honest with ourselves about the results? Instead of claiming that "our process improvement resulted in a five percent efficiency gain," why don’t we candidly give the whole story: "Although the process changes were accompanied by minor changes in technology and worker knowledge, we believe there is a high correlation between the implementation of the new processes and a five percent efficiency gain." The problem with providing the entire context is the information industry manager who doesn’t want all those words; she or he wants a red-yellow-green stoplight chart.
Further complicating the problem of not understanding what it is we’re improving (people, process, or technology) to achieve performance improvement, we often improve one dimension but then measure another dimension. For example, if improve the quality our processes, but then measure the quality of our product, how can we possibly quantize the relationship between action and results? The solution is simple: Improve what we will measure, and then measure that which we improved. If we improve processes but then measure project or product performance, our measures are "muddled" and results are speculative at best. When we improve processes and measure processes, we reduce the variability of influencing factors, and our measurement information is more meaningful.¹⁰
One of the first mistakes organizations often make in muddling their measures is failing to classify the measures in the same three buckets in which they intend to make improvements. Table 1 below identifies some of the typical performance measures organizations collect. However, what this table does—that organizations often fail to do—is to associate the measures with the area of improvement in project, product, or process.