Your hear it often: “value adding” but what does it mean really?
I am specialised in helping companies and individuals become more efficient by removing activities that do not add value.
There are 3 kind of activities you do in every process:
- Value adding activities (VA)
- Non-value-adding activities (NVA)
- Activities required in the current process (BVA)
What is the main difference?
Imagine, you would put every activity that you perform to get your end product (physical product or service you deliver to the end-user or to your colleague) on the invoice for your customer.
If the customer would say “no, no, no…I don’t pay for THAT activity” that is the Non-value-adding activity. And you should remove it from your process.
In reality, customer pays for those inefficiencies because it is included in your price. But he does not know it and worse … you are not aware of it either.
Examples: looking for information, correcting mistakes, filling useless forms and reports, meetings without results, working on something that is already finished, producing more than needed, asking colleagues questions over and over again because you did not get answer yet.
You should remove every wasteful, non-value-adding activity from the processes. Why?
Why removing waste?
Wasteful activities create inefficiencies in the process. Every, really every process is full of inefficiencies.
Inefficient processes eat up resources, require more time to complete, uses money, material and employee capacity.
Inefficiencies inflate your costs, making your price higher and margins lower.
When you reduce waste in your company and in your processes you free up capacity: you can deliver more products and services with your current capacity. You do not need to add more employees or more machines to deliver more products and services.
OR… you can reduce your capacity and still able to deliver the same volume of products and services.
The first option is more desirable but in certain situations – when demand is not increasing – you need to cut capacity.
Adding value in HR processes
HR (Human Resources) department has its own processes like recruitment, on-boarding, training, developing, exit interviews etc.
These processes are also full with non-value-added activities.
One of my clients told me they needed 21 days before a the internal process was completed to post a job vacancy.
At another company, 8 of the 10 new hires could not start working on their first day at the company because they did not have the right tools, right access, keys, laptops, user accounts, etc. yet. All those things need to be arrange on the first day or even much later. This is significant loss of production.
Free HR custom improvement plan
If you are responsible for HR processes, you are an HR Director or HR Manager of an established company, you could jumpstart with a custom plan, a blueprint for your own specific situation that lays out exactly on how to improve your HR processes to add more value to your stakeholders, other departments and business partners.
I have set aside some time to create such plan for free.
Watch this short video for more details: