In the words of Meg Wheatley, renowned writer and consultant, “The things we fear most in organizations – fluctuations, disturbances, imbalances – are the primary source of creativity.” The best companies recognize the importance of continuous improvement in all processes, including General Accounting.  To be effective, continuous improvement must include both fixing processes that are broken, and intentionally breaking processes that work in order to improve their overall efficiency and effectiveness.

During a recent Peercast our feature presenters, from a global manufacturing company with over $50B in annual revenue, shared their approach to creating a continuous improvement program in General Accounting.  The discussion was well attended, with over 140 members either participating in the Peercast or accessing the Peercast recording and presentation materials that are posted on the website for the exclusive use of Peeriosity members.

According to our feature company, while implementation details are important, you need to first have the proper global oversight and governance process in place.  A defined ownership structure is needed to drive accountability and sustain value, with four distinct elements required to achieve this objective:

1.      Balanced Scorecard – Having a metric dashboard of key indicators, both proactive and historical.

2.      Change Management Process – Having a formal “system of record” for global process changes and all incremental changes, with a focus on maintaining clear and defined process standards

3.      Excursion Management – Tracking and resolving process deviations and putting into place corrections to prevent their recurrence

4.      Training and Transition Management – Updating process documentation and providing training to ensure procedures are understood and followed. 

One of the biggest challenges with any continuous improvement program is making project selection decisions.   In this process, it is important to differentiate between “just do it” projects and “Lean Six Sigma” projects that tend to require more data and analysis since the solution isn’t immediately obvious.  For our feature company, General Accounting leaders validate larger projects with dependencies identified to ensure the proper sequencing of changes.  There is also an emphasis on keeping processes standardized on a global basis, with some site-specific deviations permitted based on local requirements.  Here are specific steps our feature company follows to complete their project selection process:

1.      First, capture improvement ideas from multiple sources including:

a.      Process managers and supervisors

b.      Action items identified during operation review meetings and peer reviews

c.       Outputs from the performance management process

d.      Suggestions from process owners or employees

2.      After the improvement ideas are captured, the Global Process Owners create the first pass for priorities

3.      Next, Global Process Owners and black-belts meet to finalize the priorities

4.      The final step is to get approval and any related funding from the Controller, who is the ultimate champion for all continuous improvement initiatives.

Using this overall structure for governance, our feature company uses a formal Lean Six-Sigma approach to process improvement, with clear definitions for roles and responsibilities and decision rights across all levels, from senior management to individual team members, who participate in projects as process experts. 

Based on the supporting iPoll¹, 74% of the companies have implemented a formal continuous improvement program in General Accounting.  Only 13% have not yet considered the opportunity.

Results from the follow-up question regarding the effectiveness of the continuous improvement program were interesting, with 78% reporting that their programs were only “moderately effective”. 

Comments from Peercast and iPolling participants provide additional insight:

·         We are in the process of developing a formal continuous improvement program that will have a dedicated website that will have various resources. The resources will include communications and training materials. We will start with a pilot group and phase in all departments and locations over an 18-24 month period.

·         We struggle with securing the resources needed to implement improvement opportunities that are identified through the various mechanisms implemented to identify opportunities.

·         It is very hard to implement ideas submitted to any “continuous improvement” program since the ideas often challenge the status quo and existing formal improvement efforts. Often, however, it makes everyone’s lives easier in the long run by including suggestions from the people who are closest to the problem, and thus more likely to know what to do about it.  We have a dedicated internal portal that we use to collect these ideas, and we discuss them during scheduled CI workshops.

·         It’s hard work and needs regular injections of energy.

·         We have a fairly formal process to identify and prioritize continuous improvements — both work process and system improvements. However, system changes can often cost too much to implement given the current low level of our service costs.

·         Corporate-supported continuous improvement, Lean Six Sigma is in place across Shared Services. However, multiple projects are a constraint on resources and time.

·         The creation of global process owner teams has ensured continued focus on continuous improvement.

Does your company have a continuous improvement program for General Accounting processes?  How effective is your program, and what steps do you follow to identify and prioritize projects? 

Who are your peers and how are you collaborating with them?

“Peercasts^TM” are private, professionally facilitated webcasts that feature leading member company experiences on specific topics as a catalyst for broader discussion.  Access is available exclusively to Peeriosity member company employees, with consultants or vendors prohibited from attending or accessing discussion content.  Members can see who is registered to attend in advance, with discussion recordings, supporting polls, and presentation materials online and available whenever convenient for the member.  Using Peeriosity’s integrated email system, Peer Mail^TM, attendees can easily communicate at any time with other attending peers by selecting them from the list of registered attendees. 

¹ “iPolling” is available exclusively to Peeriosity member company employees, with consultants or vendors prohibited from participating or accessing content. Members have full visibility of all respondents and their comments. Using Peeriosity’s integrated email system, Peer Mail^TM, members can easily communicate at any time with others who participated in the iPoll.