Platt Perspective on Business and Technology

Operational failure rates, feedback and remediation, and risk remediation processes 2

Posted in strategy and planning by Timothy Platt on October 9, 2012

This is my second posting to a series on planning for and building operationally more robust business systems (see Part 1.) I began in Part 1 with a more general, foundation discussion of standardized business practices, due diligence and risk. And my point of focus there was on systems and mechanisms for developing and sustaining business best practices and operational effectiveness on a long-term basis and in the face of change. I begin this posting from that starting point by positing two new terms and their definitions:

Operationally fragile systems are systems of operational processes that do not effectively include exception recognition or escalation processes and that do not effectively respond to failure occurrences where standard processes do not work.
Operationally robust systems have standard systems of operations in place, but they also have exception recognition and handling processes and effective, seamlessly integrated and accessed failure response and correction processes. Robust systems are built to learn and evolve, so as to minimize the recurrence of any one source of operational failure.

I would argue the case that developing business processes and best practices for long term business sustainability and strength is in large part an exercise in identifying operational fragility and augmenting or replacing it to create robustness. And this is where the two organizational mechanisms that I discussed in Part 1 enter this narrative: the continuous quality improvement committee and the help desk. The help desk approach focuses on the specific problem occurrence and addresses it according to standardized approaches and processes where possible, maintaining records of what problems and issues arise and with what frequency and for whom and under what circumstances. The continuous quality improvement committee approach seeks to develop new best practice approaches to eliminate causes of problems, and certainly for predictably recurring ones that have risen to a level of urgency to reach the attention of that group.

Robustness in this, and operationally robust systems seek to more effectively and systematically identify and address process weaknesses, making any such corrections and remediations more effective and less likely to need to be repeated. And this is where change enters this discussion too:

• Change in opportunity and change coming from the marketplace and from customer and end-user needs, expectations and preferences.
• Change in what your competition is offering and in how they do so as that reshapes the competitive landscape.
• Change in the overall economy as it impacts on businesses and consumers, and both within and across industries and marketplaces.
• Changes in the law and in regulatory requirements.
• Change from many and complex, not always predictable directions.

Operationally robust systems help businesses to more readily navigate change, and both when this means preparing for the expected, and for when it means responding to the unexpected and unexpectable.

I am going to follow this with a third series installment, explicitly bringing strategy and strategic planning into this discussion, and on finding the right balance between explicitly planned out strategic detail, and flexibility and openness to change. Meanwhile, you can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.)

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