Stay focused on continual improvement of your processes to keep your business at the forefront of your industry.

Process improvement has been around for centuries from its beginnings during the Industrial Revolution and standardization to the era of quality circles and TQM (total quality management) to JIT (just-in-time) and the Toyota Production System (TPS)/ lean management. More recently, our best clients have been focused on integrating process upgrades with the better use of ERP and related technologies, focused on predictive process upgrades with advanced forecasting and planning, SIOP (Sales Inventory Operations Planning), and predictive analytics. No matter the terms used to describe process improvement, the core concepts remain the same, and bottom-line results follow.

Common Themes for Process Improvement                   

There are several concepts or themes in common across process improvement programs and a few critical additions for the most successful initiatives.  

1. Customer focus: Every successful process improvement initiative returns to the customer for direction. Whether internal or external, the customer provides meaning as to what is valuable – improved quality, quicker delivery, a more efficient process that minimizes cost, waste and errors, etc.
2. Continuous improvement: At the crux of process improvement is the focus on constantly looking for ways to improve. Many of the best organizations develop a culture of continuous improvement where each person looks for opportunities to improve. This concept is at the heart of the lean culture with kaizen events, frequently with the goal to eliminate waste, cost, unnecessary inventory, rejects, etc. Every now and then, you also must spur on dramatic change to level up your organization. Keep both flowing. 
3. Process standardization: Although often underappreciated, process standardization remains at the core of process improvement. Searching for best practices across sites, focusing on each person/ site’s strength and instilling them across the organization is core to success. We find that the key to success is to choose the optimal standard process with the view that each person and/or site will have a strength and allow for meaningful nuances as it makes sense to serve customer needs and maximize effectiveness.
4. Data driven decisions: From the quality standpoint, Six Sigma brings the data element into process improvement with a focus on root cause analysis, data driven decisions, etc. 
5. Employee engagement: We have never seen happy customers with unhappy employees (at least long-term). According to Gallup, only 31% of employees are engaged in the U.S. If you could triple your value by simply engaging employees in the process, why wouldn’t this be a top priority? However, it is not as easy as asking employees and encouraging them to be engaged. It requires leadership, hard work, and persistence. 
6. Holistic view (end-to-end): In the supply chain, you are only as strong as your weakest link. Thus, it puts the value of end-to-end in perspective. Improving one piece of the process is a complete waste if it negatively impacts the end-to-end process. Instead, you want to view the full process and determine the best way to upgrade to gain a win-win.
7. Integration of process with systems: One of the most important process improvement attributes associated with successful clients is the integration of process upgrades with the better use and optimization of ERP systems and advanced technologies. 
8. Project management: Another underappreciated skill yet vital to succeeding in upgrading processes. Learn the basics and your execution will improve. 

Process Improvement Results

Although process upgrades seem like a good idea, there is no reason to pursue them unless they help you achieve a key goal that drives value to the organization. This might sound strange to point out, but not all process improvements make sense. You might move forward by an inch, but you distracted the organization from critical priorities. Thus, the key is to choose wisely, keeping your strategy in mind and staying agile with changing business conditions. On the other hand, you also must leave enough wiggle room for your teams to test new ideas, pilot new programs, and fail forward within reasonable guidelines. Typical results from process upgrades include:

• Customer value: speed, service levels (OTIF, OTD, lead time), revenue growth, product performance, collaboration programs
• Profitability: margins, price, cost, mix, automation, productivity, performance
• Working capital: cash flow, inventory

What should you do to stimulate process improvement? 

A few of the best practices to stimulate process improvement thinking include the following:

1. Ask – It’s always prudent to start by asking your employees, peers and managers for ideas and strategies. Start the process by throwing out ideas to critique. It will get ideas flowing and is an often-overlooked secret to generate rapid cost savings and revenue generation ideas.
2. Read & learn– Read the latest industry magazines, newspapers, blogs, newsletters (of course Supply Chain Briefing and Profit through People!), case studies etc. Go to classes and seminars, attend peripheral meetings, and constantly search for opportunities to learn. As you learn, process upgrade ideas will emerge. For example, we have found that ideas from food and beverage clients can apply to engineer-to-order industrial manufacturers and vice versa. Keep an open mind and search for opportunities.
3. Observe & listen – Watch for what seems to cause issues, look for workarounds, listen to people’s complaints and needs, and keep an eye out for interesting ideas. 
4. Network – There are countless industry, geography, alumni, and topic-related events and groups. For example, ProVisors is a group of trusted advisors with monthly connections and meetings to learn about the latest trends, meet experts and gain connections to constantly gain ideas for improvement. Other organizations such as ASCM (Association of Operations Management) host events, facilitate webinars, and lead tours to provide ideas. Attend, participate, ask, listen, network and learn.
5. Expert resources – Join a software or technology user group, hire a consultant, engage a trusted advisor, bring on an equipment specialist etc. Do not outsource process improvement but accelerate your results and stimulate ideas by engaging experts. 

Incorporate process improvement into your culture so that it is a part of the daily routine. Refer to our article, “Planning and MRP Upgrades to Support Revenue Plans and Proactively Plan Capacity” for a case study example. Incorporate ideas, tailor to work in your environment, and results will follow. 

If you are interested in reading more on this topic:
Optimizing Business Decision Tradeoffs with SIOP

© Lisa Anderson Original article published July 2013, updated June 2025.