ROI? Process Improvement? KISS!

When engineering companies start to talk about improving engineering processes, it isn’t very long before someone mentions ROI — Return On Investment. When this happens, it is important to understand the motivation. Is there truly a desire to make sure spending on process improvement is valuable? Or is it a way to delay inevitable changes? Some people are resistant to change; they find it easy to wave the “ROI” flag with a subconscious hope it means Run Off Immediately.

In the classic guide to software-based engineering improvement, ROI of Software Process Improvement, D.F. Rico works through the internal processes that always seem to take place when companies re-examine workflow. Rico wants the reader to realize the metrics of software-based process improvements don’t have to be complicated. In other words, if you are looking at ROI, be sure to KISS! (Keep It Simple, Stupid!)

Rico says the initial assessment is the key, and if a company follows three simple rules the assessment will go smoothly and offer meaningful insights:

First, define goals before measuring. Too often, engineering departments struggle to establish well-defined goals that work for both senior management, and the technical managers and staff.

Second, identify meaningful metrics. Take the time to look at existing processes with an objective eye. For example, notice where digital processes run into process walls. Those walls have names like, “print the document” or “translate the CAD file.” Take a close look at how this sideways movement of data adds time and obfuscation to the process. Identifying these walls makes it easy to create a metric for evaluation.

Third, keep it simple. It is human nature — especially in the corporate world — to complicate things. Sometimes people gain their sense of importance, and even their power dynamic in the organization, from their ability to make it look as if their sphere of influence is complicated. This is often the case with middle managers, who can lose importance when operations and processes are streamlined.

Rico offers templates, spreadsheets, evaluation forms, and more in his book, but he keeps stressing to the reader, don’t make it complicated. As one reviewer noted, Rico’s work “will show you how to characterize the problem and your efforts to solve it in terms that senior management can appreciate.” I can’t cite a study to prove it, but from my years watching the industry I have come to believe more PDM and PLM upgrade projects have failed due to lack of buy-in from senior management than from any form of technology failure.

When senior management comes on board with how you will evaluate process improvement, you have greased the skids for adequate funding to get started and continued funding over the long haul. This kind of approval is a tail wind that makes it easier to achieve full utilization of your new software platform and gain approval for the training your staff will need. It will also give you the fast return on investment that leads to faster time to market, better control of ongoing development costs, and a better overall team experience.


Randall S. Newton is the principal analyst and managing director at Consilia Vektor, a consulting firm serving the engineering software industry. He has been directly involved in engineering software in a number of roles since 1985. More information is available at https://www.linkedin.com/in/randallnewton.




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