How To Improve Your Business Processes
Business processes are very important. They involve all the activities of your business, whether it be serving clients, reporting financial information, or managing your team. There are many factors involved in ensuring your business runs smoothly. Process improvement is essential if you want to improve all areas of your business. When you are doing well, it can make all the difference in how clients feel about you and your product/service.
Business processes are the mechanisms by which any business organizes which products and services it offers. The more clearly defined and efficient your processes, the more paid-for quality will come from them.
I believe that the current state of business processes leaves a lot to be desired. They are overly complicated, operate at cross-purposes, and more often fall far short of meeting their stated purpose.
This is what process improvement addresses.
Business process improvement is the process of matching systems of behaviour or process (technical, organizational, human) to the goals of an organization. It typically comprises of :
- reducing uncertainty about resources, processes, and goals;
- improving the quality of service delivered; and
- producing value for customers, co-workers, and other stakeholders.
The below is a simple framework for process improvement, with 4 interconnected components: strategic alignment, methods, technological capabilities, and people.
Strategic alignment
Strategic alignment deals with the relationship between processes and goals. It involves identifying, communicating and acting on key business objectives.
Each step in the process must be understood in terms of its relation to the goal or objective. It is usually achieved by identifying a set of parameters that each area of the business must remain within — otherwise, processes that aim to achieve a specific result will appear to be working against it.
Without strategic alignment, processes eventually become ineffective because no decision-maker has been able to integrate the information available into a coherent strategy that will resolve opposition from resources, people and the environment.
Key objectives include growth, development, profitability, sustainability and professional development within the organisation. It requires accountability and programme management by establishing the processes that support these objectives. Achieving strategic alignment requires bold decisions that are based on analysis and research with all stakeholders involved and informed. Strategic alignment requires management actions at different levels within the organisation to support auditing activities by external parties.
Ensuring strategic alignment promotes organisational transparency and fosters a culture of accountability. It prepares any organisation to cope with shocks and implement change during times of uncertainty.
Methods
Several process improvement methods have proven successful in building or changing business processes. These include but not limited to process mapping, process modelling, process improvement, and process project management.
Process mapping is used to identify processes. Today’s business process management needs are diverse, very sophisticated and complex. Process recognition contributes to process audit results giving a clear picture of process-related issues. Up-to-date processes help employees execute duties more efficiently and effectively.
Process modelling involves identifying commonly occurring tasks and activities that can be performed more efficiently or cost-effectively. Process modelling, therefore, helps identify the sequence in which activities in a process should take place factoring in key business objectives.
Process improvement involves looking at an individual initiative or group of initiatives and determining how we can either improve the effectiveness or reduce overall costs.
A good business owner knows that the key to success depends in part on how effectively they can improve their processes. Whether you’re looking to improve your marketing or your customer service, the development of new processes can make huge improvements in both quantity and quality.
Process project management is about how to think through and implement ways so that you can increase efficiency in all areas of your business.
It can be as simple as having a team leader set up routine meetings with project managers or having specific meetings set up ahead of time so that communication lines are open.
Technological capabilities
Information Technology can be defined as the capacity to store, retrieve and manipulate information in a way that enables an entity (everything from a company to a country or a network of companies) to communicate with other entities and implement business processes.
It’s quite important and many small business owners and managers often overlook IT. This comes from the fact that most business owners think their bodies can handle it all, and in most cases this is true. However, IT plays an essential role when it comes to ensuring companies work better.
In Process Management, IT refers to process-aware information systems (e.g. Enterprise Resource Planning or ERP systems). These are based on defined workflows that include input from human or other systems, then execute them per standard procedures. Such IT systems facilitate efficient analysis of processes, proper control, and agility in terms of learning.
IT in process management has become a key enabler to many business operations. It not only has become flexible and less costly for our IT departments, but it also contributes to process optimization, quality control, and agility in achieving better business outcomes by providing a better overall view of the entire operation.
It is not a real easy task to pick the best IT systems but based on my experience, keeping in mind factors like cost, ease of use, integration with other systems, robustness, and so on, will help you find a company that can provide the very best. Soon, I will cover factors to consider when choosing the right ERP system for your business.
People
People-oriented businesses manage technologies, people, customers, stakeholders and organizations through a mode of working that develops them as lifelong learners. Human capital is the lifeblood of most modern businesses.
To thrive, today’s employer must choose an effective and relevant way to create lifelong learners in their employees. People-oriented companies make the process of building and maintaining knowledge-base management systems part of their culture as well as their business strategy.
Human capital is the capacity of an employee, supplier, borrower, or citizen to contribute value to the business’s success.
A good start to thinking about how you plan on hiring is to ask a few key questions: (a) What skills do you need that can’t just be learned overnight? (b) What roles are involved, and most importantly (c) How can we get the right people in place to help us?
The company needs to create work opportunities that encourage ongoing growth, increased skills and knowledge. That is why people-oriented businesses have a distinct advantage in having opportunities for competitive advantage through their human capital.
Businesses need to balance efficiency with effectiveness and the tech tools that help them achieve it.
Cost, time, and effort are the main limitations to business process improvement.
A business needs to achieve its goals and align its objectives across all stakeholders. There are many ways to do this, but most importantly: choosing the right tools so that they can work seamlessly, and making process improvement a continuous practice rather than a one-time event.
