Integrated Business Planning - Internal Resources

This is blog 6 in a series of 9 on the topic Integrated Business Planning (IBP). In these blogs we will detail our IBP Framework, the importance of a proper IBP implementation and the benefits it can bring organisations. Topic of this blog: People – Process – Tools – Analytics.

For any organisation to work well and achieve their goals, internal resources and process are needed. In this blog we will discuss the four most important ones for the IBP process:

• People
• Process
• Tools
• Analytics

In the shared analogy of the plane being off track most of the time (see previous blog – link), resources and processes are needed to keep track of the end goal, the destination as set from the start. We believe that these four internal are equally important, without one the other three will not work optimal. And all play an important role for a efficient and effective IBP process.

People

Without people, there would be no IBP. The quality of the people working in your organisation determines the quality of the output of the processes. People have the ability to check the outcomes and see if adjustments are needed (continuous improvement). Their wisdom, energy and creativity makes sure the internal processes keep on working to achieve the set strategic goals.

If there is a shortage of human resources in your organisation, you van either hire additional resources or make the processes more efficient, so more work can be done with less resources. The same goes for knowledge. If the current pool of employees is in need of additional knowledge, training and coaching can be implemented to make sure this knowledge is acquired and sustained.

The quality of the pool of employees defines the quality of the output of an organisation. Constant monitoring, adjusting and communication is needed to make sure adherence to plan is maintained.

Process

Besides the human aspect, internal (and external) processes need to be in place to make sure an organisation runs as smoothly as possible. Processes make sure the required steps are taken, in the right order to guarantee at least a minimum qualitative output. All organisations have processes in place, formal or informal.

But too many or too strict processes choke the organisation with the possibility to grind it to a halt. Processes should be kept as minimal as possible, but we tend to add steps, checkpoints to processes over time to make it more complex. We think by adding, we are in control, but the opposite is true: keeping processes as simple as possible adds the greatest flexibility.

These processes make sure we can guarantee a specific outcome, making these processes predictable. If we want to make sure that all processes are geared to support the strategic goal, periodic updates are needed. In most cases this means alignment across processes and departments and almost always a reduction of steps and gateways to increase flexibility and agility.

Tools

Tools can be anything that supports the employees and processes in an organisation. Think of hardware needed to produce an end product: conveyor belts, production machines, transportation vehicles, lifting machines, cleaning machines. desks, computers, etc. All needed in the process to create a product.

An other option could be the software to support the desk workers in managing and controlling the processes. Think of Microsoft Office, ERP- and CRM software, billing software and planning solutions. All needed to forecast and compare the actuals with the plan to be able to adjust where needed.

Any tools used in an organisation need periodic maintenance. Machines need to be maintained, cleaned and upgraded. The same goes for software. And all other supporting tools like furniture, buildings also need to be maintained or replaced from time to time. Without the proper, update to date and flexible tooling, no qualitative output can be generated. Tools also make sure that the interconnectivity between departments is (technically) established and maintained.

Analytics

People running processes with support of tools generate data. This data is increasing significantly over time and needs to be analysed. Key Performance Indicators (KPI’s) are defined and monitored over time. If KPI’s fall outside (over of under) set thresholds, warning signals will be displayed.

Based on the strategic goals translated into tactical and operational goals, close monitoring can be established using analytics. In this way, adherence to plan can be closely watched and actions can be defined if the organisation gets off track. The earlier these warning signals are visible, the easier it is to adjust and the less costly.

Conclusion

All the four mentioned resources (people – processes – tools – analytics) are needed to set actions in place and monitor progress. Based on set quantitative and qualitative goals, an organisation is able to monitor adherence to plan and adjust, in time, where needed. Organisations should use the continuous improvement cycle to make sure the mentioned four resources generate the required output.

In our next IBP blog, we will discuss the external forces Competition – Social & Economics – Risk & Opportunities – Laws & Regulations that support the IBP process.