As you should know by now, the critical path is the guidestar for every worker and the entire company.
This need not be a mere abstraction. Below are just a few ways to keep the critical path before you at all times, and thus avoid wandering off it:
When you are commuting to work and thinking about what you should do that day, part of your thought process should be “What can I do to have the biggest positive impact on the critical path?”
As you prioritize your day’s activities, you should start with the ones that will benefit the critical path most. In many companies, if you don’t start out with critical path activities before the whirlwind of the day engulfs you, you may never get to them.
When you go to a meeting and the team has identified several possible actions to take, recall that the critical path should have the most weight in the team’s decision making.
The critical path should take much of the guess work out of your daily planning. Your major remaining decision might be: do I work first on today’s or tomorrow’s critical path?
Before everyone can get on the critical path, however, they have to know what it is. Although employees should be able to figure it out for themselves, managers also have an obligation to ensure that all employees are on the critical path. This should start at the very top with the top executive team charting the flow of the critical path and providing a data dashboard for every major line of business. They might include:
CUSTOMER/REVENUE DASHBOARD
MAP: A map of the critical path for each major line of business.
CUSTOMERS: A list of the top customers for every major product or service in every major line of business; if individual customers are too fine a grain, then the dashboard might display major customers by demographic or other sorting method.
CUSTOMER SATISFACTION: The level of customer satisfaction with every piece of the value chain along the critical path.
NET PROMOTER: The “net-promoter” score for each customer segment, i.e., their probability to re-purchase and their willingness to advocate your company to potential customers and to the general public.
DIFFERENTIATION: Which pieces of the critical path currently differentiate the company in the customer’s mind?
UNEXPLOITED DIFFERENTIATORS: Which pieces of the critical path are currently unexploited as value differentiators in the customer’s mind, but could be in the future?
TIME: The amount of time it takes for each piece of the value chain along the critical path to deliver their part of the product or service to the customer.
REVENUE: The revenue generated by every major product or service in every major line of business.
COST DASHBOARD
COST: The actual cost of every piece of the value chain along the critical path.
BUDGET: The investment budget devoted to every piece of the value chain along the critical path for each major line of business.
CP HEAD COUNT and COST: The number of actual hands-on employees and their total salary cost devoted to every piece of the value chain along the critical path.
CP MANAGEMENT COST: The number of managers and their total salary cost devoted to every piece of the value chain along the critical path.
SUPPORT MANAGEMENT COST: The percent of organizational support managers’ time from legal, HR, accounting, etc., and their total salary cost devoted to each major line of business.
SUPPORT EMPLOYEES COST: The percent of organizational support employees’ time from legal, HR, accounting, etc., and their total salary cost devoted to each major line of business.
SUPPORT RESOURCES COST: The percent of organizational support resources devoted to each piece of the critical path, such as IT, equipment, outsourcing, etc. in each major line of business.
The point here is: know what the critical path actually looks like so that everyone in the company has a common understanding and create tools that make the critical path a constant, visible part of employees’ work. Everyone should know where they stand in relation to the critical path and where to apply their efforts.
In most large companies, top management will not be able to do all of the above due to lack of hands-on detail. Instead it will need to be built from the ground up. The actual people who do the work to build and sell products to actual customers will have to map out the critical path for those specific products/services and those specific customers. The combination of all these “local” maps of the various critical paths will be the building blocks for each business unit’s critical path map.
A good exercise is to have lower-level employees within one piece of the critical path value chain draw the critical path map for their piece and then share their individual maps with each other to see how their understandings match. The manager can both facilitate this discussion and help correct any misconceptions till there is a common understanding. This common map can then be pushed a level higher where it then will be shared across the other pieces of the critical path. The melding of all those maps will help form THE critical path map for the larger business unit.
The resulting critical path map isn’t a god that everyone bows down to. Instead, it is a starting point for everyone to understand the current business model. However, it now becomes a living prototype that everyone seeks to improve by making it better, faster, shorter, smarter, more effective, and more profitable. Using the data dashboards detailed above, everyone can try to increase customer satisfaction and advocacy, generate more revenues, and reduce costs. The critical path also gives the organizational support people a clear visual as to how they can tie themselves to it. In fact, the folks on the critical path should work with the organizational support to show them where they might have the biggest impact.
While this critical path exercise moves everyone in the positive direction of getting on the critical path, as mentioned in the previous chapters, companies also have to avoid the many negative ways that they get people off the critical path.
Critical Path Action Items
What would you include in a critical path dashboard for your department?
What would you include in a critical path dashboard for your business unit?
Draw a map of your department’s critical path vis-à-vis your paying customers.
Draw a map of your business unit’s critical path vis-à-vis your paying customers.
Where and how do you fit into your department’s and business unit’s critical path?