Understanding Process Transparency
Being “transparent” in the personal sense typically refers to not holding back the objective account of our actions and observations. When we embrace transparency as a guiding principle, we become completely open to sharing what we know. Practicing transparency in our day-to-day lives naturally shapes our behavior, as we increase our awareness of (and accountability for) all our actions. Getting in the habit of being transparent and honest helps govern our actions and makes communication with others cohesive, authentic, and efficient. It also happens to be a foundational principle of process science.
From a process science perspective, transparency is always more efficient than the alternatives, no matter how tempting they may seem in the moment. Whenever people engage in lies, politics, misleading, omission, etc. it takes additional effort to do so, and the results of those interactions will therefore always yield less value over time. Additionally, if we stray from an objective representation of actions and information and let emotion and subjectivity interfere with our rationality, this also results in worse outcomes from everyday interactions.
Embracing transparency in our personal lives consistently leads to optimized outcomes, and the results are even more staggering when this transparency is embodied at scale between humans within business processes. Because businesses are little more than collectives of people, the same principles which apply to us on a personal level also apply in our businesses.
So what does transparency within a business context look like?
Process transparency in a business context
Process transparency is the idea that every resource involved in the process can see and be aware of as much of the process as possible. This awareness can typically be improved through better communications, better access to data, dynamic reports or data visualizations, etc. When your business can clearly articulate its process data to all its employees and stakeholders, process transparency and cohesion in the human layer of the business increases – creating significant increases in energy flow and self-driving process optimization.
Process transparency as a metric represents the degree to which information that describes a process and its value objective is complete and available for everyone involved in the process. When process transparency is high within an organization, this openness allows the flow of business energy (labor and capital) to route itself to the right processes without over-administration or ambiguity.
Many humans coming together with the same objective form an aggregate business consciousness – similar to a hive consciousness as seen in the insect world. The ability for a hive to create value is directly related to the amount of energy that can flow through all the individuals that make up the hive. Without free data flow through all humans in the business, the knowledge of the group is disrupted, causing both individual and group energy flow to be unstable. Creating transparency in the process helps the entire business organism react and move more cohesively. This translates to better outcomes, regardless of the scenario.
As a general rule, increasing process transparency and reducing uncertainty always reduces cost within the business context.
While high process transparency will always help the business, low process transparency will always hurt the business – this is a universal law of process management. Though it is often overlooked, the impact of poor transparency can be severe and systemic throughout the entire business when not addressed. These costs typically form very predictable patterns of waste behavior within business organisms.
The cost of poor process transparency
Poor process transparency leads to process waste. However, it would be more accurate to say that the degree of process transparency within an organization determines the overall likelihood of establishing lasting institutionalized waste, versus creating it directly. This is because lower transparency effectively equates to an increase in the risk of waste.
Perpetual, natural process variation and/or change occurs within healthy business ecosystems as a result of shifting market demand, changing technology, changing staff, etc. Some of these changes will yield positive benefits, while some will cause harm and need to be quickly addressed before they persist. It is the inability to expose these expected (controlled or uncontrolled) changes throughout the entire business that leads to wasteful changes becoming solidified as part of a process. The cost of poor transparency is therefore tied to the increased risk of wasteful processes not being seen and/or addressed, and the subsequent increase (oftentimes significantly) in costs for the business over time.
How does one identify low transparency within an organization? Look for information and process “silos” within the business. The term silo refers to pockets of resources that are not communicating with other parts of the organization, severely impeding process transparency. Silos can form between individuals, teams, functions, departments, etc. Within organizational silos of any kind, process changes can occur that negatively impact, or sub-optimize, the entire organism’s process, but are allowed to persist because it is not apparent how the process within the silo is related or rooted to the overall process. When this becomes an issue in organizations, it allows for highly wasteful patterns to develop; such as significant process variation between staff performing the same functions, or parallel processing paths between functions that should be aligned linearly.
This same mechanism underlies much of the categories of entrenched waste within organizations, the most common including:
- The general exchange of information in any form
- The 3 M’s of Lean (Muda, Muri, and Mura)
- Organizational adaptability
- HR costs – disengagement, turn over
Each of these could be a discussion in itself, but for now I’ll simply summarize the root cause of why all this waste accumulates uncontrollably in a low process transparency environment: lack of staff autonomy.
Without free access to knowledge, management is required for information dissemination. Management is the antithesis of autonomy, which generally reduces productivity and business outcomes and manifests in a whole range of wasteful ways.
How lack of staff authority leads to low transparency and waste
Without free access to knowledge, good decisions can’t be reliably made by staff, and permission must be granted in order to mitigate risk. Permission is preceded by review and bureaucracy, which amounts to significant waste and inaction in organizations.
When resources are not given the right information, i.e., enough information to understand the value they are supposed to be creating, or feedback information regarding how their behavior impacts value creation upstream or downstream in the process they are a part of, this lack of insight becomes a cause of persistent waste creation.
For example, waste occurs in the form of wait time when resources have to wait for information to be provided to them, or they waste time jumping through hoops when necessary information is supposedly “available” for ad hoc access but made difficult to obtain.
If an organization were to focus simply on increasing process transparency by addressing staff autonomy and authority alone (and the information flow to enable it), much of the waste the business is concerned about would self-correct naturally. In order to increase process transparency at this level, it must be internalized as a process design principle, and inform any process decisions or ongoing process management the business is engaged in.
Process transparency as a process design principle
Designing processes which maximize the transparency and visibility of information for all resources involved greatly reduces waste in all forms. Efficiency in processes relies heavily on the transference of reliable and relevant information, such that all involved parties can effectively understand the universe in which the process is operating and make well informed decisions when these decision points occur in the process.
To put this into practice through process design work means to always look for ways to visualize or passively drive awareness of the entire process for everyone who participates in it. This is becoming increasingly important, as processes become more digitized and geographically decentralized. With knowledge of how their individual function impacts the entire value chain, resources become empowered organically to effectively improve their process within the context of the overall workflow. This doesn’t imply more autonomy from an authority standpoint itself, but is a prerequisite to receiving increased authority; but increased authority should quickly follow the increase in autonomy if the full value of process transparency is to be achieved.
Examples of process mechanisms that drive vision and autonomy are:
- process dashboards,
- reports that measure the entire process and which are provided to staff, or
- the dissemination of process documentation that outlines the entire process to staff.
To summarize this design principle at a high level: always design process in a way that reduces ambiguity and labor around information transfer. This will inevitably create more flow in the process, which is the end goal of a good process design.
Additionally, all those responsible for execution of a process should have awareness of the process as a whole, so that the entire system can benefit from an accurate view of the total value chain their work supports. Creating total information transparency (within constraints) is a major waste reduction driver, and the benefits are wide ranging in terms of promoting organic process improvement, staff cohesion, and staff productivity. Integrating this approach into an existing process management strategy means always considering whether any changes being contemplated will increase or restrict the ability for information to flow through the process.
In closing, we should take a moment to consider why process transparency is such an issue within our current business context. Typically, there is a lack of transparency by choice — management chooses not to share what they know freely for a variety of reasons, including:
- ego or sense of ownership (which is a natural tendency),
- what they consider good data handling practice (not moving around sensitive or private information too freely), or
- the idea that staff shouldn’t be distracted and should be on a need to know basis based on their role.
Another common obstacle to transparency is general IT challenges. Many organizations simply lack the skills or knowledge to transform all the relevant information into a state where it can be easily retrieved or understood. Often, there is a lack of process expertise internally that makes it difficult to know what data, out of the incredible amount available within a work environment, is even relevant to make usable. Capturing and transforming data comes at a cost, and many organizations don’t know the value of parsing certain data into information that will empower resources to better execute processes.
This is how a seemingly simple concept can actually be very challenging (culturally and technically) to put into action. Nonetheless–whatever the resistance, history, or other issues may be–figuring out how to provide more transparency (both within the business culture and within all process design aspects) is critical to reducing process-related costs and reaching a mature business model.
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