Gold Standards – Part 4

Jan 16, 2022 Gold Standard, News

Engaging Data Explains :

Creating The Gold Standards in Data –

Part IV –

Balancing Internal and External Considerations


In this final part of our four-part blog on gold standards, we’re going to examine the importance of external considerations. These are factors inherent to the industry and location of your business that impact directly on your company and its day-to-day functioning.


Firstly, every industry has its own regulatory body and best practices that influence the way you work. In recent years, laws around the use of data (GDPR) and how it can be stored have evolved, with the aim of better protecting personal data.

To return to our cake shop example, the Food Safety Act 1990 provides the framework for all food legislation in England, Wales and Scotland. The legislation is concerned with, among other things, ensuring that food businesses take responsibility for how food is labelled, advertised and presented, so that it is neither false or misleading.

Laws and regulations therefore directly impact the processes, people and technology used to create cakes, while also potentially increasing production costs.

Questions you can ask yourself:

  • What regulatory bodies impact my cake shop, and how does this impact on the gold standard?
  • Are there any laws that may impact my cake production?
  • What if a new law or regulation arises, am I prepared for this? 

Economic (Demand drivers)

All customers have different demands; they require a range of products at varying price points. As we have discussed previously, the product price is dependent on the cost of production, however this is also influenced by the economic strength of the country in which the product is created.

Production Costs

The economic status of a country, whether recession or prosperity, has a direct impact on the cost of production and the purchasing habits of customers. Furthermore, various countries can produce the same products at different prices, while the strength of currencies can also impact the global market.

If a country is in recession, customers may shift from premium to mid-range products, accepting that the quality may diminish. Consumers may also purchase less frequently, or even stop buying entirely.

Here are some simple examples of economic impacts on the cake shop:

  • Recession may lead to using low-quality ingredients, or reducing the bakers that manufacture the products.
  • When the market is growing, this may lead to higher demand and / or production, or to an increased quality of ingredients.

The economy of a native country will drive the demand for cakes. This change in behaviour is something that cannot be controlled, but planning can be put in place. Building flexible and adaptable processes can enable your cake production to shift with demand, even though achieving this can be challenging. But identifying trends in demand is key to adapting efficiently and keeping your customers happy.

Questions you can ask yourself:

  • How can you detect changes in customer demand?
  • Are your gold standards set up for change? Can they adapt?
  • Are you and your team prepared for change?
  • Can your infrastructure cope with change?

Technology (Levers for improvement)

Technologies used in cake production are varied, but they must always support the processes and people involved in manufacturing.

Within the cake shop, the oven could be considered a bottleneck. If you have the space for more ovens then you can scale up your operation. And if there is an oven that can cook the same amount of cakes in half the time, this may be a better solution to the bottleneck.

Each item of technology within your process has its own limitations and potential. Understanding this will help you adapt to any situation that you encounter.

Questions you can ask yourself:

  • Is there a warranty on the ovens that we use?
  • Do I licence the equipment that we use, or do I own the equipment?
  • Do I understand the lifespan of our equipment?

Ongoing Delivery

The job can never be considered done, especially for data warehouses, particularly if data is used to make business decisions about customers, or to support business change.

Once the initial gold standard has been created, both periodic and failure reviews are recommended to ensure that standards continue to produce the value expected. These reviews can start at any point of the production process, but should be thorough and constructive, assessing all key elements of the people, processes and technology.

These reviews should be consistent in assessing elements against the following criteria:

  • Does the Process still fit – did anything about the process slow down the delivery?
  • What was the customer experience – did you create a good news story? Did the customer get what they wanted? Did this add value above what was expected?
  • Best Use of Technology – did the technology let you down?
  • Best use of People – were there any gaps in knowledge or skills, or impacts on customer experience?

Ask the difficult questions rather than reviewing the successes and you’ll have a much better chance of improving your operation.

Internal Considerations

As well as considering internal outcomes, there are also internal factors that will inevitably impact on the production process. Once production is up and running, there are usually support functions that are also part of the process, which are separate from the production team. These functions will help keep everything running smoothly. 

When the cake shop initially began trading, bakers were responsible for ensuring that the company’s machinery was in good working order and fit for purpose. This was a collective responsibility, but the bakers decided amongst themselves that one particular employee, Jerry, would carry out the maintenance, as he restored classic cars in his spare time and therefore already had an advanced skillset.

This was fine for some time. But when Jerry was out of the country on holiday, the food mixer broke down at the least opportune moment; right at the start of a large order. Jerry had the most experience and knowledge of this machine, with the other bakers having relied on him in these scenarios. In order to ensure that the order was fulfilled, the manager of the shop took the decision to purchase smaller food mixers, and pay the bakers overtime. The order was completed, and in the aftermath the management team reviewed the root cause of the delay in processing.

Subsequently, the decision was made to use an external maintenance company to monitor and maintain kitchen equipment. The shop’s equipment would be checked every month, to ensure that everything is in good working condition. In addition, the maintenance team will also be on call should something break during normal production hours.

The maintenance company ensures that all engineers have the relevant training and certifications to work on the machinery. Although the bakers may know enough to fix the machinery, it is not their job to deal with this, enabling them to focus solely on production.

But the shop continues to consult with the bakers when purchasing new equipment, as they keep abreast with the technology trends in the industry. This helps best practices be maintained.

Questions you can ask yourself:

  • Are roles and responsibilities suitable for your process?
  • Do you have any key risks?
  • Does your support team have the right experience?
  • Are there any service level agreements with the support team?
  • Does the support team add to the overall process?

Testing

Developing a testing method is another important internal consideration, yet it involves a simple process. Agile development is key here – revealing important data insight as it’s being developed. This constant checking builds certainty and comfort with business users, as they approve the state of data during development. This approach breaks down testing time and, in some cases, can reduce the overall development time. 

However, not all businesses can adopt this approach. Company policies, laws and regulatory requirements may impact the options available, and will be reflected within the internal process. This may lead to a more formal approach to testing.

Failure to control how testing is conducted can have a negative impact on the perception of the production team. Care is required to ensure that the team takes the right approach to obtain the correct output.

Questions you can ask yourself:

  • Does my testing methodology fit with the resource availability?
  • Is my testing thorough enough to meet business expectations?
  • Will the testing form part of my production process?

Creating gold standards requires internal and external considerations to be factored into the equation. Accounting for these diligently, and developing processes that reflect this, are critical for success in data-driven operations.


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