How uncertainty can be made predictable

May 4, 2023 – Reading time: 7 minutes

At the peak of our current crisis, companies are left feeling paralyzed and uncertain about their future. One possible way of gaining planning reliability again is to adapt internal work processes.

Even in times of Corona it is possible to achieve planning reliability. Just because well-known methods fail, we don’t have to leave the actions of a company to chance.

The federal and state governments are currently trying to cushion the negative effect on the economy with the help of high financial subsidies. This has successfully bought us time – but how are we going to use it? Most companies seem to have decided to „wait and see“. Personnel costs are being minimized by short time working, budgets are frozen, and forecasts are being revised downwards. As long as national and international restrictions are expected to continue, the risk of a bad investment seems too high.

Now is exactly the right time to adapt internal work processes to the changed conditions. Processes that think in six or even twelve-monthly cycles fall short of the current dynamic conditions. This can be counteracted by breaking down the interaction between business units, departments or work groups into smaller increments. A regular form of after-action allows for a timely correction of the course. But be careful to change your behavior without adapting hierarchical corporate structures. You then run the risk of increasing frictional losses while remaining sluggish.

Closely linked to cost savings is the pursuit of efficiency. Since R&D provides limited contact points for automation, ways to achieve similar progress with fewer personnel need to be found. There is a high risk that silo-thinking will lead to staff shortages and delays.

A possible countermeasure is the transformation of the value chain into a value stream. This enables faster action, since activities are prioritized in the overall context. Unnecessary efforts and meaningless process steps are not considered if responsibility is lived in the overall context (product development and customer satisfaction).

An example: a project team usually consists of employees from different departments or development areas. They all follow an overall process that can be broken down into individual steps and are assigned to the individual role representatives. The disadvantage? The limited scope of observation (e.g. step 12-A) favors silo-thinking. Furthermore, a regular, cross-project exchange between all role representatives is necessary to ensure consistent solutions across projects.

In a value stream, one department is responsible for its contribution to value creation. This can be the implementation of a payment service or functional test across all projects. This shifts the goal from finishing a process step to creating customer/company value.

There are also softer approaches that promote a focus on the unrestrained flow of development processes.

Those are just a few examples of the variety of actions companies can take. All of them focus on creating shorter reaction times. The main goal is to gain more control over turbulent market conditions in the long run. Depending on the industry and company size, some methods are more advantageous and can already generate more flexibility with little effort.

The current slowdown is an opportunity to change existing business processes and adapt to the ongoing uncertainty.

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