No business or organization wants to be inefficient and ineffective. The opportunity to trim the fat and remove excess bloat to make your organization a lean, mean competitive machine should appeal to everybody serious about growing their business. We're going to look at business process improvement and show you how it can help your business attain peak performance and stay there.
Below is everything we will cover. Feel free to skip ahead.
- What is a business process?
- What is business process improvement?
- Advantages of business process improvement
- How do you implement process improvement?
- Business process improvement methodology
- The phases of a business process improvement project plan
- Manage any process improvement with pragmatic project management software: TrueNxus
What is a business process?
Everyone knows how fond business people are of snappy business jargon. To truly understand business process improvement, we need to take a look at what a business process is. This will help you focus on business process improvement and show how you can implement it in your organization to make sure you're operating at peak efficiency.
A business can contain a broad range of divisions, support functions, activities, goals, and interests. With that in mind, the short answer is that a business process can be almost anything that happens in your business towards the purpose of furthering your company's interest.
That's not very specific or useful, however. It also doesn't give us an idea of how business processes can be improved, nor does it tell us why they're vital in helping your business reach peak performance.
The technical definition of a business process is any process or processes for accomplishing a particular business goal. However, for a business process to be successful, it needs to "have purposeful goals, be as specific as possible, and have consistent outcomes."
Monitoring business processes with the goal of making your business efficient and competitive is known as business process management. It's vitally important that you identify every single opportunity to streamline and optimize your business. For one thing, companies that regularly report profits perform 50% more tests than those that don't.
It's not hard to imagine why. Companies that focus on optimizing their organization are incredibly successful when they do so.
What is business process improvement?
Business process improvement lets you focus on aspects of your business that you might otherwise overlook. It also helps you visualize your entire business as a series of interconnected systems or processes.
In this aspect, business process management is more of a framework or way of thinking than a product or service or even another part of your business like human resources or marketing. Business process management is more like Agile development or SCRUM, with a similar potential to revolutionize your organization from the ground up.
Like Agile, business process improvement can optimize any business process in your organization. Some of the most common business processes for business process improvement include:
- Client onboarding
- Customer support
- Employee onboarding
- Promoting marketing materials
- Financial planning
- Supply chain
- Product development
- Process improvements
Now that you've got a better idea of what business process improvement is and does let's take a look at some of the ways it can help your business. We'll then take a more in-depth look at optimizing different business processes for other areas of your organization.
Advantages of business process improvement
With so many business areas, we're not content to simply guess how our efforts are performing. You wouldn't run a digital marketing campaign for a specific goal, whether increasing conversions or generating qualified sales leads and continually dump money into it while hoping for a good outcome.
If we wouldn't accept such guesswork from our sales or marketing departments, why are we be content to let it slide in other areas of our organization?
Focusing on improving your business processes isn't just right for your bottom line, either. It helps you have happier, more fulfilled employees, as well. It's also a significant boon for your investors and shareholders, who can see exactly how your business performs, down to the granular level.
Here are six other advantages of integrating business process improvement into your company.
1. Improved productivity
Business process improvement isn't merely for monitoring your existing workflows. Otherwise, you could use some of the many business analytics tools and dashboards that are out there. It also helps save your work in a variety of other ways.
One of the main advantages of business process improvement is automating several business processes that might otherwise clog up your inbox and prevent you from doing more meaningful work. It makes it easy to automate many time-consuming tasks in your day-to-day business operations.
Using business process solutions such as Robotic Process Automation ("RPA") allows you to automate reoccurring tasks like transferring data, sending out emails, or manually filling out forms. Not only does this save you time, but it also improves your work by removing errors and eliminating inaccurate data.
Say, for instance, that you're running an e-commerce store. Imagine that you've just got a new product shipment that you need to add to your website. Not only is adding these products manually inefficient, but it's also demoralizing for the employees who feel that they could be doing more meaningful work.
Business process improvement, and RPA specifically, eliminates the need for many manual business processes, freeing you up so you can spend your time on more productive tasks.
2. Employee satisfaction
No one likes to feel that their work doesn't matter. It's not a good feeling to know that an unpaid intern could handle the job you're doing-especially if you're dealing with highly trained and skilled employees, as your workers no doubt are.
Removing redundant busywork is just one way that business process improvement can make for happier employees. Remote collaboration solutions like project management software help increase transparency and bolster accountability in all levels of your workplace. You'll know precisely who's job something is. You'll also see the status of that task and when it's due.
Business process improvement doesn't just help your employees feel more satisfied. It also helps them feel more engaged. It's vital that you consider employee engagement when you consider that only 29% of millennial employees feel engaged at work.
Not only will this help you get the most out of your employees while they're at work, but they'll also feel more secure in knowing that their work matters. This is vital for retaining the best talent, an on-going challenge, considering that 64% of millennials were willing to change jobs in 2018.
That's up from 22% in 2014! Clearly, this is a widespread problem that can influence your company in all manner of ways. It's also another way that business process improvement can help your business in subtle ways. You won't have to spend all of your time, money, energy, and resources on continually recruiting.
Instead, you can focus on building the best possible product or offering the best possible service to your customers, on time and under budget!
3. Customer satisfaction
Getting products to market on time and at an affordable price is just one way that business process improvement can improve your customer's experience. It can also automate customer engagement, sending up follow-up emails after a purchase or a visit to your website. It's an easy way for your customers to feel valued and appreciated.
Giving that level of personalized attention is next to impossible when everything's being done manually. It also raises the customer's expectations. If you're going to have that high level of customer service, you need to maintain it for as long as you have that customer.
The good news is that it's an easy way to increase customer loyalty and trust in your company. This is worth more than its weight in gold in today's business world. It costs five times as much to secure a new customer than maintaining an existing one.
Even that equation doesn't fully factor in the revenue you might lose out on by losing a customer. Calculating a customer's lifetime value involves some high-level math but, suffice it to say, you could be missing out on a sizable amount of revenue.
That's not to mention the new business that could come your way via those customers, as well. Happy, satisfied customers are exponentially more likely to recommend a company. Considering that 92% of consumers believe recommendations from their friends and family over traditional advertising, you can't afford to ignore this metric!
4. Reduced errors
Like it or not, humans are prone to errors. Things will get overlooked when things are done manually by your employees, and mistakes will get made. While this isn't necessarily the end of the world, it should still be guarded against. You should put every system in place to help keep mistakes to a minimum.
Some mistakes could potentially be very costly, as well. Imagine you're filling out an order for supplies or for a product to sell. Imagine an extra zero getting added on to the order by mistake. Suddenly, you might be stuck with a bill for 10,000 ballpoint pens!
5. Remaining agile
We talked a bit about the Agile framework at the beginning of this article. There's a reason nearly two-thirds of companies are using Agile methodologies in some capacity in their workflow.
One of the reasons Agile is so popular, and it is infinitely scalable. This is mandatory if you genuinely want to be successful in today's business world. If you're just starting in business, the odds are good that you won't have all of the resources you need. You need an open-ended system in place so that your business can continue to grow as you do.
If you're already established in business, there are numerous reasons why you should integrate agility into your business. Maybe you don't need all of the resources all of the time. Or perhaps you get an unexpected rush of business that pushes your existing resources to the breaking point.
Putting business process improvements in place helps make sure that you're ready for anything at any time. If there's one thing that 2020 has shown us, anything can happen, and expect the unexpected.
6. Integrates with technology
If you've ever tried to integrate multiple third-party applications without pre-planning, you know what a nightmare that scenario can be. It's even worse if you're dealing with legacy software. You don't even want to think about the headache that can come if you're dealing with proprietary or in-house software.
Putting a business process solution in place helps ensure that it never happens. It'll work to ensure that all of your business software works together, quickly and seamlessly. This dramatically facilitates collaboration across all of your channels and throughout your entire organization.
Now that you understand the benefits that business process improvement can have for your company, let's look at how you can improve your business processes.
How do you implement process improvement?
Now that we've assessed what business process improvement is and some of the advantages it can bring to your organization, now let's take a look at how you can improve business processes yourself.
The first step in implementing business process improvement is to get your thoughts organized. Business process improvement is a framework, remember, not a concrete object.
First of all, you should assess all of your existing business processes. Most business processes can be broken down into three main categories. These are:
Operational business processes are anything that facilitates your business making money. This could include sales and the processes necessary for making them, such as marketing or securing new leads.
Management processes are business processes for running your business. These could include human resources, budgeting, or managing your employees.
Supporting processes are those that help your business run. These could include recruitment or technical support, for instance.
Even looking at this list, you should be starting to think like a business process manager. Improving your business processes constitutes taking an inventory of your entire organization thoroughly and systematically. You need to know what business processes are happening.
Next, you should think about what frameworks you'd like to use to optimize your business processes. There are many you can choose from.
Business process improvement methodology
We've mentioned Agile a few times over this article, but that's just the tip of the iceberg when it comes to business process improvement methodologies that can make your business function more efficiently. Here are some of the more popular frameworks to give you some idea of where to begin.
1. Six Sigma process improvement
Six Sigma employs a statistical approach to improving your business processes. It also uses the acronym DMAIC, which stands for:
Six Sigma works best for business processes with quantifiable input and output. This way, you can measure and control how your processes are performing. "When I do x, y will happen."
Six Sigma leverages tools from other process improvement frameworks. As such, below are some of the tools you may use to help execute DMAIC.
i. SIPOC Diagram
You may leverage a SIPOC in both the current state analysis and future state design stages of business process improvement. SIPOC is an acronym with the below meaning.
ii. Ishikawa Diagram (a.k.a., Fishbone Diagram)
The Ishikawa Diagram, or Fishbone Diagram, is also known as the cause-and-effect diagram, which helps you and your team identify potential root causes for defects. Additionally, it helps you and the team brainstorm for possible solutions.
iii. Business Process Mapping
Business process mapping leverages process flow diagrams. With business process mapping, you and your team will map out the entire process delineating between different roles and responsibilities.
2. Lean management continuous improvement process
Lean management lives up to its name. It helps your organization function as efficiently as possible by following these steps.
- Identify the value your business delivers to your customers
- Map how you deliver that value
- Identify areas where you can eliminate wasted time
- Establish "pull" when the customer needs the product
- Continually improve
3. Agile process improvement
We've mentioned the Agile framework a few times throughout this article, but let's look into it slightly. There's a reason it's one of the most popular business frameworks in the world.
Agile methodologies involve breaking down processes into the smallest possible steps. These steps are then handed off to teams who work on them in "sprints." The goal is to eliminate downtime.
With Agile, your work is continuously in development. This is opposed to the "waterfall method," where one step triggers the next. This is, in actuality, a revolutionary new way of thinking about business.
It can completely restructure your organization once you get into it.
4. Kaizen process improvement
The last framework we'll consider today is related to Agile. Kaizen also involves continual improvement and empowering each team member. Kaizen identifies opportunities for small improvements.
These small steps add up until your whole organization is performing at peak efficiency.
The phases of a business process improvement project plan
Now that you've settled on a framework to improve your business, let's take a look at the 7 phases of any business process improvement project plan.
1. Outline your goals and objectives
The first step to any business process improvement effort is to document the goals and objectives. One of the most well known goal-setting frameworks you can use is OKR (objectives and key results). Below are some of the questions your organization should ask itself. They'll come in very handy down the line.
- Why are you performing business process improvement?
- Are you trying to increase Net Promoter Scores (NPS)? If so, how much?
- Are you trying to increase revenue through cross-selling? If so, how much?
- Are you trying to reduce costs? If so, how much?
It's best practice to document your goals and objectives in a charter.
2. Document the current state process
Next, you'll create a map of your business processes. In other words, you'll create a current state view of the business processes as it operates today. Creating this current state view will help you to visualize areas that need improvement.
To do an inventory of the current state process, you'll want to conduct interviews across every stakeholder involved. These interviews will be genuinely cross-functional. Additionally, the interviews may take a bit of time if you operate in a matrix organization. You'll want to interview colleagues from other departments and any clients and contractors that may be involved in the process. During and after the int
Several tools can help you and your team document the current state process. A few of the tools we recommend leveraging are the SIPOC analysis diagram and a business process flow. You may find that neither tool suits what you need precisely. If that's the case, you can certainly develop a hybrid, which leverages multiple tools.
3. Identify the problems
Once you've documented the current state process, you'll want to analyze the current state process. From there, you should synthesize everything from your interviews and identify the problems, or in other words, the pain points, inefficiencies, or defects. Essentially, you're identifying issues so that you and your team can design a future state process or solutions to the problems identified.
Imagine, for instance, that your sales team doesn't have enough qualified leads. This could lead to animosity towards the marketing department, which could harm company morale.
However, while the problem may seem obvious, you'll be surprised by the actual cause of the problem. As a result, you should perform your diligence, interview everyone involved, and document the process itself, the inputs, outputs, and every stakeholder involved. You'll be shocked to realize that there will likely be several points of view on how the process works or should work.
4. Prioritize the problems
After you've identified and inventoried all of the current state process problems, the next step is to prioritize the problems. This phase is where it may get a bit tricky. That's because you'll find that most, if not everyone, has a distinct view on what are the biggest and most pressing problems.
Additionally, you may find that several stakeholders may be speaking about their feelings. As a result, you'll want to leverage a prioritization framework that is objective and measurable. Otherwise, how will you measure success once you've performed your business process improvement?
To prioritize the problems you and your team want to solve, think back to your original objectives. Why are you performing business process improvement? Are you trying to increase Net Promoter Scores (NPS)? Are you trying to increase revenue through cross-selling? Are you trying to reduce costs?
If you can answer precisely why you're performing business process improvement, then the next question is, how can you measure impact? Are you able to quantifiably measure a process improvement against one of the objectives? If so, prioritize the forecasted result.
Paired Comparison Analysis
If you and your team find it hard to answer any of the above questions, you can still make the prioritization effort objective. To do this, you can leverage the decision making framework known as Paired Comparison Analysis, or what we call Pair Ranking Analysis.
In the simplest of terms, with Paired Comparison Analysis, you pair each problem against one another and then rank them. Then you add each value and convert it to a percentage. From there, you'll sort all of the problems, largest to smallest.
You can do this process with one person or as an entire team. We recommend doing this as a team prior, or during a working session.
5. Design the future state process
Now that you've documented your current state process, identified the problems, and prioritized the problems, it's time to design the future state process. Here's where you'll start putting your insights into action. As a team, re-think and develop solutions or new business processes to the problems.
Remember, though, to start with the highest priority items. However, if the highest priority problems seem overly complex to solve, it's best to start small and get some quick wins. By getting quick wins, you and your team will create momentum. From there, you could attack the larger and more complicated problems.
6. Implement the future state process
So, you've documented the current state process, identified the problems, prioritized the problems, and designed the future state. Now it's time to roll out the solutions to your problems.
To do this, it's best practice to execute a few pilots before rolling it out enterprise-wide. Again, you want to create momentum across the organization. Pilots that are quick wins where you can measure success allow you to increase buy-in across the organization.
In addition to piloting your solutions, it's best practice to get senior leadership to communicate before, during, and after the change. Support as a cheerleader from senior leadership is essential. You'll want everyone in the organization to know that implementation is the company's highest priority.
7. Review and refine the process
After you've begun rolling out the future state process, whether as a pilot or not, you'll assess all of the changes you've made while overhauling your business processes. At this stage, you should measure success with key performance indicators ("KPI") and get some qualitative feedback on how these changes impact your organization. You'll be starting to get a sense of what's working and what might need improvement.
Continuous process improvement
Remember, business process improvement isn't a one time event. It's an on-going effort and a fundamental shift in how you think about and practice business operations. The 'review and refine' stage acts as a filter before the cycle is started all over again, making sure that your system is airtight and working as flawlessly as possible.
Taking the time and energy to improve your business processes is more than worth it. It's working smart, so you can work hard and make it count! Your team will feel more appreciated and even more relaxed, with everyone knowing exactly what they need to do and their responsibility.
Manage any process improvement with pragmatic project management software: TrueNxus
TrueNxus understands business process improvement. Our workspace is built to enable your entire organization as a cross-functional team. It has everything that you need to improve your company's processes. TrueNxus is the most pragmatic work management platform for process improvement.
In any strategic initiative to perform business process improvement, you need help with:
- managing multiple projects
- Planning projects (i.e., project charters, project plans)
- Executing projects
- Monitoring and controlling projects (i.e., status reports)
- Visualizing all of your work in one central location
- Collaborating with your colleagues, clients, consultants, contractors, and other third parties
Here's a look at some of TrueNxus's features:
1. Multiple views
With any business process improvement effort, people require different ways to visualize work across time. Not only that, but each individual specializes in a specific domain, and as such, each thinks about work differently. To ensure successful planning and execution, you need software that provides personalized views that make sense to everyone involved in the initiative. These views need to be in sync as well.
TrueNxus provides you with the following views:
A list is a table that allows you to manage your cross-functional projects easily. You can organize your project work into groups such as workstreams or any logical way to categorize tasks.
With TrueNxus's Timeline, a Gantt-chart like view, you can visualize your project plans across time. It lets you understand how all of the work fits together. You can make updates to the project plans through an interactive interface.
3. Automated project status reports
We understand that each cross-functional team member is busy balancing multiple priorities, from your day-to-day responsibilities to various programs and projects. Therefore, TrueNxus successfully executes monitoring and controlling projects by automatically analyzing the project's health in real-time, giving senior leadership and the team the insights they need to make decisions and move the ball forward.
4. My Work
Another essential thing for everyone involved in a business process improvement initiative is understanding what you're on the hook for delivering. With TrueNxus, you can view every task and every dependency vital to you, across every project, in one location, ensuring success.
Additionally, we know that you don't want to let your colleagues down or be let down. You can ensure the successful delivery of programs and projects through collaboration and documenting task dependencies. By doing so, you can be accountable when others are reliant on you. You can understand dependent tasks, change implications, and adjust course as needed.
6. Automated notifications
No matter your role in any business process improvement, you can also successfully execute work by leveraging software to notify when changes occur. With TrueNxus's 20+ out-of-the-box automated notifications, you will have the transparency you need to stay in-the-know.
Additionally, the entire cross-functional team can ensure project plans are successful by collaborating directly in the app. With TrueNxus, you can communicate with colleagues, clients, consultants, and contractors in one place.
8. Project charter
Lastly, you can leverage OKR and create a project charter. You can ensure the successful execution of projects by documenting and aligning the project's objectives, benefits, and risks from the very beginning. TrueNxus is the only software that has a project charter directly in the app.
It's an exciting time to be in business. It's also a challenging time, facing constant innovation and endless competition. Luckily, there have never been so many powerful tools for helping your business optimize efficiency and thrive.
Whether you're implementing business process improvement or facilitating greater communication in your office, project management software built for change management will help that process be as smooth and efficient as possible. Contact our sales team today and find out how TrueNxus can help your business optimize and thrive!