You need to learn to Quantify, Baseline, Change, & Measure what you accomplish. If, for instance, you want to improve your internal purchasing process, you first have to establish and place a value on where that process stands—right this minute. Stop right there! I know what you are thinking. You probably hate the concept of statistical analysis as much as I do.

“Unfortunately, the vast majority of companies, especially small companies, tend to over-complicate nearly every new idea they discover."

Quit trying to force perfection through increased complication. Don't make the business process improvement concept confusing—it doesn't need to be. Try these very basic success ideas to change your range.

Take a close look at your current acquisition process. How well is it working? How many steps does your company pass through to get from thinking about a need; to acquiring the product or service; to distributing the product or activating the service; to actually making use of the product or service? List these steps out, in the order that they occur—just like that rough historical time-line you created in middle school. You do not need to purchase a complicated computer program to perform this review—a sheet of lined notebook paper will do just fine. Place one step on each line. Take some time to ensure that your list includes every step in the current process—however minor it may be.

Did you create your list? Good. Now, number each item on that list. You can now clearly state that completing 100% of the process under review consists of “X” number of steps. In this single very basic list, you have created a simplified way to measure the process as well as established a baseline for where you stand.

Process Change

Now that you have your baseline, walk through the list of steps and identify each one as a.) must have—vital to the process, b.) good to have, c.) neutral, d.) not necessary. Now, technically, in process improvement, you should only change one thing at a time—so pick one of the “not necessary” steps and work the process without that step. Did the process work? Look carefully. If the process still works after removing the step, the chances are extremely high that you can eliminate that step. Do this for each “unnecessary” step—always ensuring that the process is still effective after each change. Next, move on to the “neutral” steps. Repeat for the “good to have” steps.

“Big News: You do not have to rush your changes. In fact pushing change on the people around you is a nearly guaranteed way to ensure that you fail. Bring change in slowly. Let people get used to the small things, then work your way up.”

Keep the baseline in sight

You may decide that, instead of completely removing some steps, the process improves when you combine two or more elements. That is perfectly fine. Now, here is the key: Always keep your original list of process steps as your initial baseline. If your process originally required 40 distinct steps, and you reduced those steps to 20, you have achieved a 50% reduction in the process complexity. This could easily be quantified as a 100% improvement in effectiveness or in efficiency and it cost you basically nothing but some time and a slightly more focused line of thought.

What you will have accomplished, if you work on this methodology for analyzing your environment and initiating, then measuring, change, is a standard for business process improvement.

Take Note: To accomplish these results, you didn't need complicated formulas; No high-level mathematical gymnastics; No highly paid consultants—you just plain simplified the entire concept.

Now, if you take this concept one step further and place a monetary value on each reduction, you will also be able to determine how much you have saved the company with your improvements. Again, don't complicate the process. We are not trying to launch a probe to Venus—we just want to improve our operations.

By the way, if your process steps take up more than fifty lines to document, you are very probably out of control—or you have combined several processes into one gigantic lump of confusion. If this is the case, break down the individual processes, streamline each, then see if they can be recombined in their streamlined form.

Is this all there is to Quantifying, Baselining, Changing, & Measuring? Not a chance. It is, however, more than enough to conduct a very good analysis on the vast majority of processes that the average small to medium business asset manager will encounter.