Operations
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What is a Business Process? Definition, Examples, and Advantages

What Is A Business Process? Definition, Examples, and Advantages

A business process is a collection of business tasks and activities that when performed by people or systems in a structured course, produces an outcome that contributes to business goals. In this article, we teach the definition of business processes and look at its advantages, examples, and related business terms.

Processes are everywhere in a business. From onboarding new employees, to exit interviews, vendor invoicing, and sales. Every business outcome is a result of repeatable tasks and activities.

Some of these processes are executed strictly within the documented guidelines, while some are attempted with more flexibility. This differs based on the priority and importance of the business outcome derived from the process.

Nevertheless, a business cannot function without the proper execution of its processes. In this article, we will dig deeper into the concept of a business process, its examples, advantages, references, and importance in your business operations.

Table of Content

What is a Business Process?

A business process is defined as a collection of business tasks and activities that when performed by people or systems in a structured course, produce an outcome that contributes to the business goals. A business process includes at least one of, but not limited to, the following elements:

  • task/ activity
  • system
  • employee(s)
  • workflow
  • data

Business processes are invented to derive and contribute to organizational goals. The continuous and repeated execution of business processes is pivotal to successful business operations and business growth.

Business process structures can be simple or complex, based on the elements involved in the process. Through every business process, a business strives to achieve certain goals.

Some key attributes that distinguish business processes from other business tasks and activities are:

  • a process is repeatable
  • a process is flexible and not rigid
  • a process is specific and has established start and endpoints
  • a process is measurable

To understand this better, let us take an example of the employee offboarding process, which has the following steps:

  • acknowledging the resignation/termination
  • negotiation with the employee for retainment
  • notice period and final settlement procedures
  • planning for pending projects and assigned tasks
  • hand over and knowledge transfer of project and company details
  • exit interview

These are the most common activities involved globally in an employee offboarding process. Through acknowledgment and negotiation discussions, the business tries to reason with and retain the employee. The notice period and final settlement procedures help the employee and company get clarity on the terms of the contract pending after the resignation. The project planning and handover activities help the business make sure that daily processes are not affected due to the resignation of the employee. Finally, the exit interview provides the business an opportunity to improve with detailed feedback on the company operations and policies.

Business processes are the backbone of your business operations, which is why improving them is of strategic importance to your business. According to Gartner, implementing a business process management strategy increases the success rate of your projects by 70%. Organizations around the globe are investing a significant amount of time and money to manage and improve their business processes.

Business processes are often confused with projects and procedures. Processes are finite, flexible, and repeatable, and generate value post their execution. Let us understand how they differ from projects and procedures.

Processes vs. Projects

A project is focused on creating something new or implementing a change, whereas a process is focused on creating value by repeatedly performing a task. Simply put, projects are activities that you have never performed in your business before, whereas processes are activities that you do repeatedly.

For example, making your daily cup of coffee is a process. You like to add the same ingredients in the same amount and make it every day. There are almost no chances of the taste going wrong, but if it does, I know how that bugs you!

But trying to make an Instagram trending coffee recipe from Korea isn't something you do every day. You are experimenting with new ingredients and methods, which make it a project. It is new, exciting, and you don't know how it is going to pan out.

Processes vs Procedures

A process is a flow of business activities that are connected toward the achievement of a business outcome, whereas a procedure is a prescribed way of undertaking a process or part of a process. While a process is a set of defined actions, a procedure is a set of instructions that are detailed in nature.

For instance, onboarding a new employee in your organization is a process. It is focused on introducing the company to the new person and familiarizing them with company policies, culture, and teams.

Whereas onboarding documentation is a procedure. It has a detailed set of instructions related to documents, signatures, and agreements.

To manage and improve your business processes, you must understand them better. Let us take a look at some more examples of business processes, their advantages, and context with other business practices.

Examples of Business Processes

Processes vary depending upon the type, industry, location, etc., of a business, but there are a few processes that are practiced across all these segments of businesses around the globe. To make this easy to understand, we will look at examples of such processes.

Sales process

Making a sale is a fundamental business process across various industries, offerings, and other segments. The common process observed by most businesses involves the following steps:

  • sharing the sales proposal
  • sending quotes
  • negotiations
  • receiving orders for product/service
  • updating records of sales
  • delivery of product/service
  • billing
  • payment

These are repetitive steps and the workflow and structure of the process are flexible based on the business.

Customer service

Customer service is another important process that is a part of global business operations. It involves the following steps:

  • receive customer complaints/issues through CRM
  • acknowledge the customer concern
  • login details of the issue in the CRM system
  • resolve the issue
  • communicate status to customer

A few more examples of business processes are:

  • recruitment process
  • invoicing process
  • order processing
  • customer onboarding process
  • accounting process
  • market research process
  • product development process

Common Terms Related To Business Processes

We are listing down a few common business terms that are in direct content with business processes:

Business Process Management

Business process management is defined as a discipline in operations management in which people use various methods to discover, model, analyze, measure, improve, optimize, and automate business processes.

Use this detailed guide to learn more about business process management.

Business Process Improvement

Business Process Improvement is defined as a management practice used to improve the efficiency and effectiveness of business processes by discovering, mapping, documenting, analyzing, and redesigning processes. We will learn more about why you should invest in improving your business processes further in this article.

Business Process Mapping

Business process mapping is defined as the activity of creating a workflow diagram of a process to gain a clear understanding of the process and how it overlaps with other processes. It is a business process documentation tool that uses visual aids to document and communicate the details of a process across the company. Read this guide to learn everything about business process mapping.

Business Process Documentation

Business process documentation is the process of outlining a detailed description of how a process needs to be executed. It is a technique undertaken by businesses to make their processes learnable, viewable, and improvable. It primarily focuses on answering the question - 'how is the process implemented?'. Learn more about business process documentation with this detailed guide.

Business Process Discovery

Business process discovery is defined as a set of techniques that build a representation of an organization's current business processes, which include their workflows, structures, and elements. Learn everything you need to know about process discovery in this article.

Business Process Automation

Business process automation is defined as the practice of using technology to automate complex and redundant business processes and workflows. It helps businesses save manual efforts, reduce costs, improve efficiency, and optimize process performance.

Business Process Handoffs

Business process handoffs are defined as the transfer of information, responsibilities, or people in your business from one entity to another. They are critical to the smooth running of your business operations in case of employee resignations, team restructures, etc. For more details, read our guide to business process handoffs.

Why Should You Improve Your Business Processes?

Effective and efficient processes are the key to unleash the growth and sustainability of your business. The surveys from the 'State of BPM' report indicate that businesses have made process improvement a priority in their overall business strategies. But why should you consider improving your processes?

Here are a few reasons to get you started with business process improvement:

It helps you save costs

Process improvement enables you to identify unnecessary spending of resources and finding effective ways to produce the best process output. This allows you to save on costs that otherwise can be utilized for other important priorities. And as most business blogs and research papers suggest, it is easier to save existing costs than to acquire new customers, which is another reason to improve your processes, and in turn, save costs.

It boosts productivity within your teams

Process improvement helps you eradicate redundant and unnecessary tasks and activities from your process. It enables you to re-engineer your existing process with more effective techniques. This encourages your employees to take up more challenging tasks as opposed to clerical redundant activities, surging the productivity meter in your operations.

It enhances the customer experience

Business processes lead to outcomes that directly contribute to business goals, one of them being customer satisfaction. Effective and efficient business processes produce exceptional outcomes that delight your customers. Hence, business process improvement enhances your customer experience.

It helps you live a better life

Improved processes lead to better operations, better business outcomes, and better lives. Once your processes are streamlined, you can enjoy personal life without any stress, worry, or guilt - because your processes will take care of themselves!

Take Control of Your Business Processes with Processology

Business processes are the driving force of your operations. You need to take control of your business processes before they start controlling your business. At Processology, we help businesses like you untangle your processes so that your team can operate better to live better with our simple 4-step roadmap:

  1. Assess Improvement Need and Opportunity
  2. Discovery "AS-IS" Process
  3. Process Improvement and Design
  4. Process Documentation

Explore the opportunity of improving your business processes with this simple yet effective program - connect with us today.

Take Business Process Improvement Opportunity Assessment