A study by BCG/MIT finds that 90% of executives deem sustainability to be important, yet only 60% of companies incorporate sustainability as part of their business strategy, and even less (25%) integrate sustainability into the core of their business model.
To generate a clear business case, organizations need to write business operations with sustainability in mind, which can be done by the following two steps:
- Document their business processes.
- Implement effective process improvement techniques for sustainability.
In this article, you’ll learn how to document your business processes and why this documentation is important for driving your sustainability agenda. You’ll then be presented with ten process improvement tools to help sow sustainability into your organization’s core.
Why do you need to start thinking about your business processes for corporate sustainability?
At the core of every business are business processes.
A business process is a collection of linked tasks that find their end in delivering a service, product, or project.
It’s important to manage your business outputs, aka the product/service/project, but to then supplement this management by process control – especially when creating a sustainable business, as I’ll explain.
For instance, you might have a sustainability-led project in mind. You can use project management tools and techniques to streamline project planning, resource management, task dependencies, financial planning, and deliverables. But how do you know operations feeding into a given sustainability project are also sustainable?
This is where business processes come into the picture. By documenting your business processes, you are separating your end goal, aka the output, from the operations that deliver that output. Keeping these two things separate means you can control business sustainability from all angles.
How to document your business processes?
Before you can make process improvements, you’ll need to document your business processes. Due to the complexity of business operations, use process documentation software, such as a Business Process Management (BPM) platform.
Process documentation gives the transparency needed to improve your business processes.
However, this documentation may seem a daunting task to get started. To help, consider the below steps:
- Identify and name the process, starting with the core business processes
- Define the process scope, i.e. what steps are included in the process and what aren’t?
- Explain the process boundaries, i.e. where does the process begin and end? What causes the process to start? How do you know when the process is done?
- Identify the process inputs and the resources necessary to carry out each process step.
- Brainstorm the process steps by gathering team information from process start to finish.
- Organize the steps sequentially to create a process flow.
- Describe who is involved and responsible for each process task.
- Note down exceptions to the normal process flow.
- Add control points and measurements. This includes identifying process risks or sustainability measures to monitor the process.
10 Top Process Improvement Tools
Process improvement tools are techniques and methods to be used by organizations that will drive improvements in quality and performance, targeting the processes of a business. In this article, we’re taking a unique look at these sustainability tools. That is, what are the top process improvement tools that can deliver sustainability improvements within an organization?
Process Improvement Tool #1: Gap analysis
Gap analysis examines and assesses performance to identify the difference between your current business state and where you’d like to be. To further shed some insight on this, process optimization tools call for the following to be done beforehand.
- The current situation or performance.
- The ideal situation or potential.
- What needs to be done to get from performance to potential, otherwise known as bridging the gap?
To evaluate current sustainability performance, follow pre-established best practices – aka sustainability standards – to evaluate your current sustainability performance. Popular global standards to follow include:
- European Eco-Label: This voluntary standard encourages businesses to market products and services that are kinder to the environment.
- Business Social Compliance Initiative (BSCI): The BSCI is a European non-profit organization focused on improving social compliance in the global supply chain.
- ISO-International Organization for Standardization: The ISO has developed over 18,500 International Standards on various subjects. Of particular relevance are ISO 9000 (quality management systems), ISO 14000 (environmental management systems), ISO 2600 (social responsibility), and ISO 31000 (quality management systems).
Once a current performance measure has been determined, you can define your ideal situation based on meeting or surpassing standard requirements.
Next lay out a clear framework that will take you from your current performance to your ideal situation, potential. To do this, define:
- Your top goals, along with the skills needed to complete these goals.
- An action plan will utilize team skills and experience to reach your goals.
Process Optimization Tools #2: Root cause analysis
Root cause analysis helps you understand the causal focus underlying the issues behind your biggest business sustainability pain points.
This is a great process improvement tool to use alongside gap analysis. I.e., What’s preventing you from reaching your potential state?
Root Cause Analysis acknowledges root cause issues as not-so-obvious problems. A common method to implement Root Cause Analysis is via the Fishbone Diagram (Ishikawa diagram) – as presented below.
To produce a fishbone diagram, complete the following steps:
- Identify the problem.
- Brainstorm causal factors.
- Construct your fishbone diagram: Begin by recording your main problem at the center of your diagram (the fish spine), e.g., to reduce plastic waste.
- Write down the various potential causal factors. Arrange these around the central problem in branches (the fish rib bones), with the first branch beginning with very broad ideas.
- As you continue down the fish spine, further branches will move on to smaller, more specific categories until you eventually reach your root cause.
Process Improvement Tool #3: Hoshin Kanri
Hoshin Kanri is a strategic planning method ensuring everyone in an organization is driving towards the same goals. The method moves away from the typical top-down deployment of organizational change toward a bottom-up approach.
That is, everyone in the organization is involved in setting improvement priorities. The method takes improvement objectives – e.g., this could be your objectives set to solve a given root cause – and then breaks these objectives down into smaller objectives, which are broken down further into projects. Projects are distributed around your team.
The Hoshin Kanri methodology creates and maintains transparent feedback loops across all hierarchical levels in an organization. The idea is to maintain an open two-way stream for information sharing.
Like a ball, your sustainability objectives are passed from top-level management to lower organizational levels. Lower levels then relay feedback and tactic propositions back to upper management. There may be a few iterative ball-passing until a consensus is reached and your sustainability objective is obtained.
You can use gap analysis to define where you want to be operating (your potential), then define the root cause using root cause analysis, set your objectives, and effectively install sustainable change using the Hoshin Kanri methodology.
Process Optimization Tools #4: PDCA cycle
Next up on our process improvement tools’ tip is the PDCA cycle.
The PDCA cycle stands for Plan, Do, Check and Act. It’s a 4 steps for implementing sustainability improvements, as follows:
- Plan: The project team determines what they’re planning to change.
- Do: Improvements are made.
- Check: The improved process is compared with the old process, determining whether the changes made were improvements at all.
- Act: Everyone involved in the process plays their part in driving sustainability improvements.
The PDCA cycle centers around the idea that more can always be done. The concept is a cycle, meaning organizations will continuously assess where they lie on the sustainability agenda and act/make process changes accordingly.
Process Improvement Tool #5: Force field analysis
With only ⅔’s of U.S. citizens concerned about climate change, not everyone in your team will be fully engaged and on your side when sustainability-related changes are introduced.
For this reason, you’ll need an effective change management technique in your process improvement toolbox. Here we take a look at Lewin’s Force Field Model.
Lewin’s model gives a problem overview and splits factors into forces for (driving forces) and against (restraining forces) organizational change. When these forces are balanced, there’s no change. To introduce organizational change, driving forces need to be boosted and restraining forces need to be alleviated. To accomplish this, the model splits the process of implementing change into 3 stages:
- Stage 1, unfreeze: The change needed and the business operations affected by this change are defined.
- Stage 2, make the changes: During the change phase, fresh practices and ideas are exercised. However, the model encourages the user to acknowledge negative emotions that’ll arise during change – e.g. overload, confusion, and disorientation – meeting these emotions with patience and tolerance.
- Stage 3, refreeze to new status quo: Once the changes have been deployed, measured, communicated across the team, and feedback has been obtained and acted on, then organizational change is consolidated.
Process Improvement Tool #6: JIT – Just In Time
Just In Time production is a management philosophy used to control production processes. It’s about producing what the customer wants, when they want it, in the quantities requested, where they want it, and without delays.
JIT is pull-system meaning investments are governed by process demand. This demand-pull means an organization only gives what’s necessary to obtain the required output in a business system.
The JIT framework keeps stock levels of raw materials, components, work in progress, and finished goods to a minimum. This reduces waste and natural resource use, helping organizations operate more sustainably.
JIT isn’t an overly complicated system, but making it work effectively requires careful planning and lots of preparation. To implement JIT, you’ll have to consider the following:
- Draw up a plan and appoint a sponsor: Assign someone in your team to own the process.
- Communicate your JIT plans to your workforce: JIT is typically associated with a reluctance to reduce inventory levels and a requirement to place a fair degree of trust in the supply chain. Consider using Lewin’s Force Field analysis to drive the production changes needed.
- Gather data and validate inventory levels: You’ll need to know where you are with your inventory to get your initial signals to your supply chain correct.
- Establish a production plan: Determine optimum production and lead time needs and feed this information through to suppliers.
- Communicate with your supply chain: Provide suppliers with forecasts for maximum visibility to reduce the impact of demand variability on the supply chain.
- Document the processes and train staff: Ensure your JIT plan is well documented and that processes are known by all participants. Monitor progress – you can use the PDCA cycle for this – to identify and resolve production weak points.
Process Improvement Tool #7: Lean Six Sigma (DMAIC)
Lean Six Sigma gives a structured approach to scrutinize operations, looking at data and processes to uncover and remove waste.
You can implement the lean Six Sigma process improvement tool through the 5-stepped model, DMAIC, as follows:
- Define what business operations need to be improved. g. What operations produce the most waste? Where can you save energy?
- Measure current process performance. Just like you have done during gap analysis.
- Analyze data to determine how the business operation needs to be improved.
- Improve your process continuously. You can implement the PDCA cycle to make continuous improvements.
- Control your processes for ongoing sustainability and optimized performance. Create a system or process to monitor results.
Using the DMAIC methodology will deliver continuous improvements, to help you establish greener business operations.
Process Improvement Tool #8: SIPOC Diagram
SIPOC is an acronym for Suppliers, Inputs, Processes, Outputs, and Customers.
The methodology acts as a tool to identify the inputs and outputs of target business processes, to determine the process owner, customers, suppliers, and to establish clear boundaries for the process.
Use the SIPOC methodology during the measure phase of DMAIC, to analyze different processes in a working system. The SIPOC methodology gives an overall system perspective by answering the following questions:
- What are the start and the endpoints of the work system?
- What are the essential steps of the work system?
- What are the main inputs and outputs?
- Who are the key customers (internal and external)?
- Who are the key suppliers (internal and external)?
- What are the customers’ demands?
With this information, you can easily identify sustainability problems or weaknesses.
Process Improvement Tool #9: Kanban
Kanban is a work management system used to identify where work gets stuck or blocked. It’s a lean methodology used to communicate what, when and how much of something is needed to be produced via using Kanban boards and task cards.
Kanban is an effective method to drive efficiency improvements in a business and reduce waste – when thinking about resource use, you can see how the implementation of Kanban can improve business sustainability.
There a 5 main steps to implementing Kanban, which include:
- Visualizing your current workflow – Use a Kanban card to represent each process task. Use Kanban columns to organize these card tasks, e.g. work-in-progress tasks, to do tasks, and done tasks.
- Applying Work-in-Process (WIP) limits – limit the number of work-in-progress tasks.
- Visualize your work – Take all the current and upcoming task items and visualize them via the Kanban board.
- Managing and measuring flow – Flow is a measure of how smoothly work moves through your system. You don’t want work stopping and starting frequently. Create a smooth flow by changing the task order on the Kanban board.
- Optimizing iteratively with data – Your Kanban practices should be ever-evolving. Be flexible and stay open to improvements.
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Process Improvement Tool #10: Prioritization Matrix
Prioritization matrix analysis is a task analysis method used to identify and depict relationships between concepts.
Sustainability-related issues are complex and are defined as wicked problems. Wicked in the sense that the issues are interconnected, have many feedback loops – meaning improvements in one area can degrade another area – and require cross-sector collaboration. Deciphering the appropriate business resolutions can therefore feel overwhelming – where do you start?
The prioritization matrix helps you order your priorities, grouping process solutions into four separate categories of importance.
To complete a prioritization matrix, follow the below steps:
- List your options: These could be tasks, projects, service/product features – basically whatever you want to try and figure out how to prioritize.
- Evaluate your options: Determine the consequences and benefits for each option and decide what’s most/least important and what’s most/least urgent.
- View your completed matrix: Options of high importance and urgency are to be completed now. Options of high importance but low urgency are to be completed next. Options that are of low importance and high urgency are to be completed last. Low important and low urgent options are grouped into a never do
Improving the sustainability of your business operations should be considered a continuous process. You can use the process optimization tools mentioned in this post to write sustainability into your business model’s core.
Post by: Jane Courtnell
I am a Content Writer at Process Street. I graduated in Biology, specializing in Environmental Science at Imperial College London. I developed an enthusiasm for writing to communicate environmental issues during my degree. When I am not writing, I enjoy being in the mountains, running, and rock climbing.