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Assessments, done properly, can provide at least one of the following five basic benefits:
The following explanations of each benefit should help allay any questions about how valuable a competitive value assessment can be to a company:
Performance Improvements - Assessments provide information about how well - or poorly - business components are working. If they are performing well then they can be applied to other business lines, current projects, or be considered for new projects - note that the components may have to be altered to fit the project's goals.
If components are performing poorly, we may have critical issues that impact the implementation of present strategies and could cause false starts or failure of future ones. Once identified as critical issues then corrections can be developed and implemented before the assets become liabilities and cause real damage. Evaluations are also used to draw attention to potential problems, which offers the ultimate "damage avoidance method" if they are taken care of promptly.
In addition to asset performance information, the results of evaluations will uncover the reasons used to drive necessary improvements. Reasons such as underperforming customer accounts, poor service, and communication glitches will be uncovered during an assessment. These "reasons" are the pointers to poor performing assets. They will come up first during evaluation discussions.
Assessments are also an essential part of a continuous improvement program. For example, sometimes businesses work at light speed and neglect improving the processes they are using to perform at that speed. An evaluation will point out improvement areas - critical issues - that will, if taken care of, enable the organization to either continue activities or prepare for future operations at the necessary performance levels needed to compete.
Discovery - Well-defined and implemented assessments will discover the company's "unknown or hidden" strengths and weaknesses and make them public. If strengths are discovered, they can be communicated to other organizations for possible use. If weaknesses or critical issues are discovered, the related assets can then be strengthened according to strategic needs. We call these "added-value" opportunities.
An assessment process will not only uncover what improvements need to be done and what strengths need to be more widely exploited but also uncovers what activities should be stopped and what "improvements" aren't worth pursuing. Evaluations will help eliminate some of the "good ideas" that really aren't.
This process of uncovering "hidden" opportunities can also be applied to customers. Assessments can help a company or business line discover opportunities by identifying what their customers value and what they need for success, leading the business to know what to focus on and prioritize. By understanding customer needs and wants, the company can then develop product and service standards that are driven by the market. In other words, companies produce the value their customers want as opposed to what they think their customers want. Using this information helps point to the "right stuff" to grow.
Note: This doesn't mean we can't lead our customers using new technologies, insight to industry changes, and business trends as the foundation for developing new value. But knowing what the customer needs and wants is still an integral part of creating the "right value," even when using our "non-customer" insights. Assessments will help discover our companies' abilities to gather and understand this foundational knowledge and whether we can effectively apply it.
Relationships - There are two components to this benefit: 1) the relationships of the people involved in making the asset perform well, and 2) the relationship of an asset to other assets.
Looking at the first component, consider the following: when I went to my boss and told him that there was a problem with a particular process or operation he would ask a few questions, ponder a bit and say that he hadn't heard about the issue from any other groups, therefore it wasn't a problem. But when I brought the problem up in a group wide meeting - call it a mini-assessment - and others chimed in that it was a problem, only then did it became "real."
This illustrates that in order for a competitive asset to be declared strong or weak you need to make it visible - effectively highlight it - and public - get the enterprise to participate in the assessment and acknowledge the asset's condition. If neither happens, getting enterprise wide action on fixing a critical issue will be difficult.
Properly run assessments use the enterprise, especially individuals - e.g. users, management, and customers - with a vested interest in an asset's performance, to determine an asset's "real" condition. Collaboration, using the insight, skills, knowledge, experience, and judgment of all an assessment's participants, can be brought to bear on making the asset what it needs to be for the business' plans. It's this collaboration - benefiting from what has been previously "learned" by all participating individuals - that increases the probability of successfully improving the company's value position.
Concerning the second component, when we do assessments of what we think are problem performance areas, we tend to focus on a particular function such as sales, marketing, support, or product development. But functions do not operate independently of one another. A good assessment will help uncover these relationships so, first, the real problem areas are identified, and second, solutions to pending problems are focused on all the appropriate functional areas.
Provide Proof - Sometimes business components - e.g. processes, tools, and skills - are brought into question as to their effectiveness. Assessments are used gather information to prove or disprove the assertion that they are operating as expected. The information gathered can be used by management to make adjustments to current plans, tactics, and activities.
Companies are constantly implementing either changed or new strategic initiatives or programs. Assessments provide the information we need to prove that they are working as intended and providing the impact expected by both our customers and our company.
Similarly, assessments are used to check the satisfaction levels of employees, customers, stockholders, suppliers, partners, and other stakeholders have with specific company programs - from those that set company direction to those that change processes. We can use the information to "prove" that they provide the expected impact, negative or positive.
Define a Baseline - Assessments provide a comparison "baseline" for future assessments. Developing a baseline is the first step in satisfying the "you can't figure out where to go if you don't know where you've been" principle. Creating a baseline is the initial step needed to follow a basic rule in making decisions and setting direction: Knowing where we are compared to where we've been, using the same terms and criteria, helps guide where we should go.
Comparing baselines, through performing multiple assessments, also provides the evaluators with information about how the assessment focal point (project, business line, or the entire company) is either progressing to or digressing from a performance goal or an intended outcome.
We can use baseline assessments to help determine if changes and trends occur in, for example, our company's and our customers' specific industries and operations.
A good assessment must be properly designed and have the right characteristics in order to reap these benefits. Part III provides a list of attributes that must be present in such an assessment.
Jonathan Narducci uses his 30+ years of experience in business, management, and quality systems to lead international companies in their search to locate and implement the ideas that helps craft the business performance needed for the business results expected. For more information visit www.narduccienterprises.com
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