|The Key Process Flow Map*|
The key process flow map (KPFM) shows where the money starts and ends. Where you spend your first dollar and when you get it back. Also known as the cash conversion cycle. The goal of laying out the KPFM is to identify each step, key inputs and outputs, and associated function along the path between the two.
When I do this with businesses, the initial investment—where the money starts—is nearly always in Marketing. Marketing is responsible for attracting interest and generating leads. Often, the money goes through Sales, and it almost always ends in the Finance department where the money is collected. Typically, money travels through four to eight steps, and the path isn’t always linear. The money may go from one function to two others, and those functions feed into a fourth. Sometimes you get paid before you finish the work and sometimes after.
With one particular business I coached, there were only four functions in the key process flow map. Despite all the different departments, teams, third-party vendors, and so on, the business rose and fell on the success of these four key functions. That new knowledge was a revelation for the leadership team. Suddenly, amid all the moving parts of the business, and there were many, they now had clarity. They could see the path to greater efficiency and greater productivity. It all revolved around these four functions, and each one had an owner.
To understand how this looks on paper, let’s say the key process flow map starts in a box called Marketing. From there, we draw a line, which we call Qualified Leads, to a box labeled Sales, the second process. Now the line may go back and forth while Sales is trying to determine if the lead really is qualified or not, but eventually Sales takes the lead or it doesn’t. Sales turns the some of the Qualified Leads into Deals (yes, you would typically call this a “sale” but I’m using the word “Deal” here to differentiate sales from Sales). Now Sales sends that Deal to the third process, which may be Manufacturing or Service, or whatever function(s) takes care of delivering the Deals’ promise. Finally, the customer pays.
Simple, right? One paragraph, four processes. This is how many businesses operate, yet leaders tend to overthink and overcomplicate the process. By taking an hour, sometimes less, to create a key process flow map, they would have a better idea of what was actually driving the business and needed the majority of their focus. (See example below)
*Excerpt above taken (mostly) from Further, Faster – How to take the Guesswork out of Growth
Now that we are clear on what a key process flow map is, here are the multiple ways this one picture adds value to your leadership and organization:
1. Provide clarity on the key functions involved in how the business makes money. It literally gets all on the same page.
2. Provide clarity on the key inputs and outputs of those functions that support #1 above.
3. Illustrate the interconnectivity and dependence on each of key functions in the creation of a customer.
4. Show the clear owners and key metrics for all key functions.
5. Provide a simple “dashboard” to visually show the status of each function. I prefer a “Red, Yellow, Green” first pass.
6. Understand the average cash conversion cycle. How long does the process take, on average?
7. Identify Profit/X candidate(s). The business’s key economic engine driver.Identify key widget(s). All the key inputs and outputs from the diagram.
8. Help identify X-factor possibilities – 2-100X velocity potential if critical internal process problem(s) is solved.
9. Help identify/inform key differentiators for the business to separate it from rivals.
10. Identify the key sub-functions under main KPFM functions (see PHASE II picture below).
11. Create 3X5 cards (mini, focused job scorecards) for each (sub) function including love/loathe/long/lust by person.
My book goes into greater detail. From 3×5 cards, the team leader can optimize strengths of each team member to maximize team performance.
Please see my book or contact me for deeper explanations of any and all of the suggested items above or how to craft a Key Process Flow Map with your team.
Bill – Certified Growth Coach, Foundations in NeuroLeadership certified, Predictive Index Certified Partner
(email@example.com; www.catalystgrowthadvisors.com)For MA companies ONLY, as an approved Training and Development provider, Catalyst Growth Advisors can offer up to 50% off program fees. Click here to see if you qualify.
Please click here to download the free pdf version of my book Further, Faster – The Vital Few Steps that Take the Guesswork out of Growth. There is also a link to Amazon for the audio, e-book or paperback versions.