In this article, we will learn the different methods, benefits, and effects of Business Process Improvement, along with our take on how to improve business processes.
Business processes are like recipes used by businesses to create an output that significantly contributes to business functioning. Their efficiency and effectiveness define the performance of your business.
Every function, department, team, or person has its own set of processes, and at times the efficiency of a process is overlooked. This can cause serious damage to the performance as well as the growth of your business.
Business Process Improvement is a practice that initiates measures to maintain as well as increase the efficiency and effectiveness of all your business processes, as well as your workforce.
In fact, 57% of companies that implemented process improvement strategies observed improved employee performance.
Let us dig deeper into the concept of Business Process Improvement and learn techniques on how to improve your business processes.
Table of Content
What Is 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 of processes. Implementing process improvement encourages smoother operations, more efficient workflows, happier teams, customers, and partners, as well as overall business growth.
Process improvement is a continuous exercise that helps you supercharge your business operations. The incremental improvement of your business processes has positive business and personal outcomes, all leading to better operations and better living.
Business Process Improvement plays an instrumental role in the overall growth of your business. A survey from the 'State of Business Process Management 2018' report backs our observation by stating that 93% of the organizations are engaged in multiple process improvement projects.
To understand how process improvement works, let us take an example of a real-life process - making pancakes. 😉
Who doesn't like some fluffy, melt-in-the-mouth pancakes on a relaxed Sunday morning? I know I do. But doesn't it bum you out when you put in so much effort to make that stack of pancakes, and they turn out to be dense and chewy? They are edible, they taste fine with syrup, but the texture is just not right. 🙄
The next Sunday, you are on a mission to improve your pancake-making process to get a better output. You sit down and look for Martha Stewart's perfect pancake recipe, and compare it to what you've been doing. Based on this, you figure out the following differences:
You are using 1 extra egg yolk
You are pressing the pancakes onto the pan (thinking it will give you crispier edges)
You are flipping them too early on the pan (can't wait to eat them, can you?) 🤣
So this time, you do all the things right based on your observations and get the following output:
You save 1 egg
Your pancakes are fluffy, soft, and perfect
You are happier, and enjoyed your Sunday more! 😋
Business processes are similar, but much more complex than making pancakes. Investing in Business Process Improvement takes a lot of time, effort, and dedication, but it does reap the benefits - cost-saving, better process outcomes, better operations, and better living.
Common Symptoms of Inefficient and Ineffective Processes
Inefficient and ineffective processes can have a direct impact on your business operations, performance, culture, growth and even your quality of life. The right thing to do is to fix these processes so that they do not cause any further damage. But how do you identify these processes when everything seems to work fine?
Use these signals to realize whether you should practice Business Process Improvement (BPI):
There are non-repeatable processes across your business
When you have to reinvent your process every time there is a setback, it is a clear indication that your process needs improvement. Most processes should be standardized sets of activities, tasks, actions, and participants. They are intended to produce the same outcome with effectiveness. If you are duplicating your processes to get the same outcome, there is a problem that needs fixing.
There is a lack of process knowledge and information
When your employees do not have clarity on how the process is executed and the expected outcome, your processes become inefficient. They are not executed in the way they are supposed to be, causing unnecessary revenue leaks and operational gaps. This is an opportunity for you to invest in process improvement.
You have little or no control over your processes
In every business, there is a situation where things get out of hand. In such crises, process control is vital. You need to have control over process standards, documents, accountability, and responsibility. A lack of control over these process elements can create mayhem, which is why you should improve these processes to control them better.
Inconsistent output is common
Your business thrives on delivering outcomes that generate value for your customers. Inconsistent outcomes are a no-brainer - there are clear gaps within your business processes that need your attention. You must retrospect and improve your business processes to deliver consistent and valuable output to your customers.
Your customers are dissatisfied
What better warning than customer criticism to realize the need for process improvement? This is a clear red flag where you need to find the leaks and gaps in your business processes to produce better outcomes and satisfy your customers.
Your business is stealing your freedom of choice
As a business owner, c-level executive, or employee, you work to gain a better quality of life at your core. You invest 8-12 hours a day working so that the other 12-16 hours are more rewarding for you and your family. However, inefficient and ineffective business processes will cause you to overwork, not to forget the unnecessary frustration, loss of sleep, and missing out on valuable life experiences. If you feel like your business or career is taking over your life, chances are your processes are designed without 'you' in mind as a priority.
A business's primary objective is survival. It will do whatever it has to do to survive, including running those who support it into the ground if it is not properly managed. - Michael D. Wilson
Methods used to practice Business Process Improvement
Process improvement is an effective way to streamline, automate, and optimize your business processes. There are various methods used to execute Business Process Improvement. It is generally a combination of two or more of the following methods:
1. Process Discovery
Business Process Discovery is a set of techniques used to view, analyze, and adjust the underlying structure and processes that are a part of the day-to-day business operations. This method is about getting your "As Is" processes out of you and your teams head and down on a document where you can see them, learn from them, and improve them.
It allows you to collect all the components of business processes that include people, departments, protocols, procedures, resources, and technologies.
A common method to get started with process discovery is to create standard process discovery questions based on process exceptions, competing priorities, and consistency.
2. Process Documentation
Process documentation is defined as a detailed guideline of how to execute a particular process. It is an essential method that describes every activity needed to complete the execution of the process.
Documenting processes help businesses keep things in order such as process maps, checklists, tutorials, document templates, Standard Operating Procedures (SOP's), and more. It helps business teams avoid the frustration of dropping the ball by creating a reference for every step in the process.
Process documentation is an extensive exercise with a lot more to consider. Here's our guide to Business Process Documentation that has everything you need to learn about documenting business processes.
3. Business Process Mapping
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 outlines every activity, role, and business entity involved in the business process.
Process maps provide a visual representation of a process that helps you uncover how you are currently operating and gives you the visuals needed to locate hidden inefficiencies and improvement opportunities.
Read more about process mapping in our detailed guide to business process mapping.
4. Communication Strategy
Communication is the essence of business processes - without effective communication, processes are just a set of unrelated, out-of-sync activities. This is why improving communication is vital to process improvement.
Effective communication formulates continuous improvement - it reduces ambiguity and promotes clarity.
5. Process Handoffs
Business process handoff is an activity of transferring a person, responsibility, or information from one person to another, one system to another, or one department to another. The successful transfer of this information is critical to run smooth business processes.
Improving process handoffs is critical to Business Process Improvement as it ensures a smooth transition of process elements by setting clear expectations, communicating effectively, avoiding assumptions, and bringing clarity to process transition. Learn more in our detailed guide and video to business process handoffs.
6. System and Platform Integrations
Systems and platforms are an integral part of your processes, and hence it is improving systems integrations is vital to Business Process Improvement. It is important to ensure all your systems and automation tools are integrated efficiently to avoid unpleasant situations.
If your systems feel more like a Digital Rolodex than a tool that increase efficiency and effectiveness, schedule a discovery with our team to see how our methods can help.
7. Training and Education
Process documents are essential to train and educate employees on business process execution. But training and education exercises are an even more effective method to impart and transfer knowledge across your company.
Key Benefits of Business Process Improvement
The goal of process improvement is to make your processes more efficient and effective. This accomplishes a lot more than better operations. A study by the American Productivity and Quality Center shows that companies that commit to continuous process improvement can reduce their error rates by as much as 60%.
Let us take a look at the most important benefits of Process Improvement:
Process improvement uses techniques to identify unnecessary spending of resources and finding effective solutions to generate the best process output. This allows businesses to save on costs that otherwise can be utilized for other important priorities.
Saving costs with process improvement is also a fitting solution for times when customer acquisition becomes difficult.
Process improvement focuses on removing redundant and unnecessary tasks and activities from your process. It helps you re-engineer your existing process with more effective techniques. The direct result of this is a boost in productivity for your employee.
Business Process Improvement enables seamless processes and efficient workflows. This leads to better operations and better outcomes that provide value to your customers. The result? Satisfied customers - and that just happens to be the dream of every thriving business!
We all know that we live in a 'customer is king' world. But without happy employees, we cannot make our customers happy. Process improvement provides you with an opportunity to satisfy your employees with clear, untangled processes that are productive, easy-to-understand, and efficient. It provides better visibility, accountability, and well-documented processes set your team up for success and keeps your employees happy.
Improve Your Processes with Processology
Processology helps businesses optimize their processes and systems to increase revenue, decrease cost, and mitigate risk. We follow a simple 4-step roadmap that ensures better operations across your organization.
Intelligence - Discover your end-to-end "AS IS" process.
We help you get the processes out of your employees’ heads and on paper. This helps you understand your process in its as-is state to analyze it and identifies gaps so that you can start thinking about improvement opportunities.
Performance - Design improvements to increase efficiency and effectiveness, like plugging revenue leaks and operational gaps for better performance.
Once discovered, we work with your team to identify opportunities to fix gaps and revenue leaks in your processes. We design tailored improvements to fix issues in your processes that are costing you money, time, and resources. The focus is to design a version of your process that enhances the performance of your process.
Technology - Align your systems to support process improvements.
The next step is to align your existing or new systems and platforms to support the improved processes. We work closely with your team to engineer platforms that support business goals and customer expectations.
Enablement - Create documentation and implement the improved version of the process.
After fixing your process gaps and systems, we help you with detailed documentation of the improved and enhanced processes. We also help you enable the improved versions of your processes through trainings and exectuion.
In a challenging economic climate, businesses would rather invest in improving their existing processes than go after more customers, as observed in the State of Business Process Management 2018' report. Business Process Improvement is a continuous process in Business Process Management that requires time, effort, collaboration, and dedication. Explore the opportunity of improving your business processes with our expertise - connect with us today.
Updated in August 2023