Posted by Steve Wilcox on Thu, Apr 02, 2009 @ 01:39 PM
As any quality expert knows, "that which gets measured gets improved."
So if you DO NOT want to improve the quality of your AP processes then ... don't measure anything.
On the other hand, if you DO want to improve your AP processes, then you need to start tracking key metrics and performance indicators through Quality Programs.
But what Quality Programs have proven track records and what exactly needs to be measured?
In yesterday's webcast, Penny S. Weller, PhD, CMA, Senior Business Advisor, at The Hackett Group explained how the following Quality Programs can improve, energize and turbocharge your AP processes:
- The "Green Room"
- Activity-based Management
- Balanced Scorecard
- Six Sigma
- Hackett Benchmarking
In a very easy-to-understand manner, Penny walked through how each of these Quality Programs can be implemented in your AP Department in a practical way, and showed that organizations with formal Quality Programs have lower AP costs.
How much lower?
38% lower costs to be specific ...
-Rakesh Shukla
@rakesh170
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Posted by Steve Wilcox on Wed, Mar 25, 2009 @ 08:43 AM
This is a picture of the cast of my daughter's 3rd grade play. If you squint, you can see her near the middle of the back row in a white tank top dressed as a crow.
The play, "Why Mosquitoes Buzz in People's Ears" is based on a very amusing West African folktale. And when 3rd graders perform the play, it is even more enjoyable.
Here's the storyline -
... a mosquito tells a tall tale to an iguana ...
... the iguana refuses to listen to such nonsense and puts sticks in his ears...
... unable to hear, the iguana offends a friendly python trying to say good morning ...
... the python is so upset, he shoots down a rabbit hole and terrifies the rabbit ...
... seeing the rabbit scares the crows overhead ...
... the crows spread an alarm that danger is near ...
... a monkey gets spooked and accidently knocks down an owl's nest ...
... mother owl is so upset that she refuses to hoot to wake the sun ...
The night grows longer and longer until King Lion calls a meeting to figure out what the heck happened. The chain of events is traced back to the source of all the trouble - the pesky mosquito. Mother owl is satisfied and hoots the sun to rise ... and the mosquito is forever plagued with guilt, compelling him to be a pest and buzz in people's ears, asking for forgiveness.
Sometimes, a seemingly isolated event, can cause a chain reaction with unintended consequences. This is especially true with AP errors. Let me explain.
Let's take the example of a supplier short-pay error. What is the cost of such an error???
The costly chain reaction is revealed when such an AP error is broken down into the steps required to address it.
Each step is time-consuming and the cost of one error can be significant. It's worth noting that paper-based processes, understandably, are known to have higher error rates - keying errors, matching errors, lost and/or misfiled documents, etc. Quality of service is also affected since errors result in irritated vendors and frustrated internal clients.
So, how do you prevent AP Errors?
The best way is to start tracking key metrics and performance indicators through Quality Programs.
-Rakesh Shukla
@rakesh170
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