Elements

Capacity

In an industrial factory, “nameplate capacity” is the term used to describe the intended, full-load, sustained output of the facility. It is measured in units, or throughput. By comparison, in knowledge work, not everyone today thinks in terms of units of output. Thus throughput is not our first choice as a good measure for the capacity of a knowledge work factory. Employees are its assets. And these employees’ available work time is a simple way to quantify capacity. Just like in a conventional factory, we can adjust it downward to reflect expected constraints or reductions: vacations, sick time, lunch breaks, and similar deductions. This will yield the nameplate capacity of our knowledge work factory in “net available hours.”

Processes

For example, those involved in accounting operations might mention the “record-to-report” process. They are referring to the business process that begins with the initial recording of general-ledger entries (debits and credits), includes the financial close, and ends with the issuance of a report—we will term this report a “work product.” This could include anything from an informal internal operating report to an external, highly regulated financial disclosure report. You might recognize the widely used terms for other common end-to-end business processes, such as the “order-to-cash” or “procure-to-pay” processes. These represent only the big, well-known processes. There are thousands of smaller ones. As we conceive our knowledge work factory, it’s helpful to start to think of business processes as summaries—or data tables—of work activities. Documenting business processes defines the quantities, sequences, and dependencies of work activities.

Work Activities

Try to think of knowledge work activities as generic, short-duration tasks, just like in a conventional factory. For example, knowledge workers “receive” a work product: via e-mail, electronic files (systems), hard copy, etc. These activities can be assembled to describe more complex subprocesses, such as “filling out a form on a computer” or “fulfilling a request for a brochure.” Yes, this initially seems impossibly tedious—overwhelming. But in practice it quickly becomes very easy because activities are similar and repetitive.

Products

Most people can begin to visualize a potato chip factory or a car manufacturing plant by starting with the end product. Visualizing a finance and accounting factory can also begin by viewing its output—reports, for example—as end products. We’ll also think about the “by-products” of knowledge work operations, just as manufacturers do for conventional production operations. Many of these knowledge work by-products can be reduced and eliminated. Think of the inbound customer queries that are the costly, unintended, and avoidable by-products of confusing instructions.

Capacity

In an industrial factory, “nameplate capacity” is the term used to describe the intended, full-load, sustained output of the facility. It is measured in units, or throughput. By comparison, in knowledge work, not everyone today thinks in terms of units of output. Thus throughput is not our first choice as a good measure for the capacity of a knowledge work factory. Employees are its assets. And these employees’ available work time is a simple way to quantify capacity. Just like in a conventional factory, we can adjust it downward to reflect expected constraints or reductions: vacations, sick time, lunch breaks, and similar deductions. This will yield the nameplate capacity of our knowledge work factory in “net available hours.”

Processes

For example, those involved in accounting operations might mention the “record-to-report” process. They are referring to the business process that begins with the initial recording of general-ledger entries (debits and credits), includes the financial close, and ends with the issuance of a report—we will term this report a “work product.” This could include anything from an informal internal operating report to an external, highly regulated financial disclosure report. You might recognize the widely used terms for other common end-to-end business processes, such as the “order-to-cash” or “procure-to-pay” processes. These represent only the big, well-known processes. There are thousands of smaller ones. As we conceive our knowledge work factory, it’s helpful to start to think of business processes as summaries—or data tables—of work activities. Documenting business processes defines the quantities, sequences, and dependencies of work activities.

Work Activities

Try to think of knowledge work activities as generic, short-duration tasks, just like in a conventional factory. For example, knowledge workers “receive” a work product: via e-mail, electronic files (systems), hard copy, etc. These activities can be assembled to describe more complex subprocesses, such as “filling out a form on a computer” or “fulfilling a request for a brochure.” Yes, this initially seems impossibly tedious—overwhelming. But in practice it quickly becomes very easy because activities are similar and repetitive.

Products

Most people can begin to visualize a potato chip factory or a car manufacturing plant by starting with the end product. Visualizing a finance and accounting factory can also begin by viewing its output—reports, for example—as end products. We’ll also think about the “by-products” of knowledge work operations, just as manufacturers do for conventional production operations. Many of these knowledge work by-products can be reduced and eliminated. Think of the inbound customer queries that are the costly, unintended, and avoidable by-products of confusing instructions.

Activity Cube

Elements

Capacity

Processes

Work Activities

Products

Activity Cube

Elements

Capacity

Processes

Work Activities

Products