Business Process Optimization: Complete Guide with Examples

Business Process Optimization is the act of taking your old business processes and optimizing them for efficiency. The general idea is to make it more efficient - the means of doing that, however, can vary a lot. That’s the key. Based on feedback from implementations - with financial services (17%), healthcare (11%), and manufacturing (8%) leading adoption - the approach matters less than the commitment to follow through.

Business Process Optimization is one of the final steps for Business Process Management (BPM), a methodology that advocates for constant process re-evaluation and improvement. So, to make it work, you should have already carried out the first three steps critical for any BPM initiative.

Specifically…

Process Identification - You should have already picked a process you’d like to work on. In most cases, you’d usually go for processes that are important for the company and are a profit-driver. What’s the point of business process optimization if it doesn’t have any impact?

Business Process Mapping - Unless you have the process mapped out, you’ll have a hard time finding potential improvements. If you don’t already a map for the process, you can do that by creating a flowchart using pen & paper, or using workflow software.

Business Process Analysis - Before you can start improving the business processes, you should first analyze each and every step. The analysis itself can either be super straightforward, with some glaringly obvious potential changes or a bit more difficult, if the problem is not too obvious. In the latter case, you can use some of the business process improvement tools to find the inefficiencies.

So if you’ve already got all that out of the way, you should have a clearly defined & mapped out process, and a couple of ideas on how to optimize it.

How to do business process optimization

As we’ve already mentioned, there can be a lot of different ways to do business process optimization. This, of course, really depends on the process in question - there is no one size fits all solution.

In most cases, however, optimization is done through either of the following methods…

If you want a structured approach to process improvement, dedicated software can help you document, track, and continuously optimize your workflows without the manual overhead.

Process improvement or re-structuring

This one’s pretty simple, and all it takes is a good look at each step of the process.

The idea is, you need to identify the processes or steps that are…

Wasteful - Each step within a process should, somehow, add a certain value to the end goal (which is either a product or some sort of output), and the process itself should amount to something in the context of organizational goals. Sometimes, however, you’ll find that certain steps or processes are actually useless, without creating any sort of value.

Want to learn more about wasteful processes? Read up on the 7 wastes of lean to learn about the different types of waste.

Inefficient or Improvable - This means that a step (or a process) is simply not as efficient as it could be. There might be a lot more steps than needed, for example.

Approval processes tend to be guilty of this quite often. If you’d want to get a new project off the ground, you would need approval from the senior management within the company. Meaning, you might have to wait for 5+ extremely busy executives to get the time to read the document and give you a green light.

Once you found processes or steps that fall into these categories, all you have to do is improve them for efficiency. This can be done by restructuring the process (change the steps or order or steps), eliminating useless processes (or steps), or by doing a little bit of both.

Automation

No one likes manual work. Sometimes, it really does make you feel like a cog in the machine, doing something that even a robot could do.

There are cases, though, where that’s exactly the situation - what you’re doing IS something a robot can do, and all you have to do is find the right tool or software.

Business Process Automation (BPA) can help take out any menial labor from your employee’s workloads, which leads to high productivity (employees work more on what matters) and morale (no one likes grunt work).

While how you’re doing automation varies by the task, here’s a few common examples…

• Social Media Management - Whatever your company does, you probably have a Facebook (or at least LinkedIn) page. The traditional way of managing these is to have someone manually log on and find something to post about 3-4 times a day. Rather than waste your time with this, however, you could use a social media management tool such as Buffer to plan out your posts throughout the next month.
• Customer Support - If you’re working with your clients online, you probably have a customer support form right there on your website. Let’s say there’s a bug in the new software update affecting around 10% of your user base. Chances are, your inbox is going to get real clogged. While the first bug report is useful, the rest is just clutter you have to waste time replying to. Software such as Intercom allows you to create events when you can send out automated replies to user complaints, depending on what keywords they mention on their ticket.

If social media management or customer support is not that relevant to your business, you might want to check out these 15+ business automation tools.

Automation Tool Pricing Reference

Technology adoption and complete process change

Adopting the right technology can really be a game changer; unlike the first two options, it doesn’t exactly optimize a process. Rather, it changes it completely.

So for example, let’s say you use a whiteboard to manage your daily to-dos within your company. By adopting a task management software such as Trello, you’d instantly be improving the efficiency of your business, without even changing any of the processes.

With software in charge, you’d be seeing benefits like…

• Fewer Mistakes & Missed Deadlines - Humans are known to err. Everyone can mess up once in a while, forgetting a very important to-do or deadline. Task management software makes sure this never happens, reminding you of all the tasks and deadlines.
• Central Command Center - It’s a lot easier to just create a new task online and pin it to your employees, rather than send out a detailed email and hope it doesn’t get lost or overlooked.

For a more process-oriented example, there’s workflow management software. Instead of having to manually keep track of workflows through email or chat, you can use a dedicated system to manage all of your processes through one dashboard.

This can automatically eliminate a lot of issues you’d encounter with process management, such as…

• Lack of Process Standardization. It can be hard to force all of your employees to follow a strict procedure. Workflow software ensures that everyone completes every step of the process in the right order.
• Easier Tracking & Analysis. Compared to your average process map, workflow software allows for easier tracking and analysis. Without software, you’d have to manually keep track of the process & deadlines through chat or email with. In addition, to actually measure process efficiency, you’d have to manually gather data from different software & employees. With software, you get all of this in a single dashboard.

Want to give workflow software a try, but don’t know where to start? Our guide to workflow applications should give you the right know-how to get things going. If you’re not sure which software provider to pick, though, read up our comparison guide to best workflow systems on the market.

Process optimization templates to get you started

Example Procedure

Employee Onboarding

1HR - Set up payroll and send welcome email

2IT - Order equipment and set up workstation

3Office Manager - Prepare physical workspace

4IT - Create accounts and system access

5HR - Welcome meeting and company orientation

+3 more steps

View template

Example Procedure

Client Invoice Processing & Billing Workflow

1Subcontractors: Perform their scope of work, paying for labor, equipment, material & any other costs

2Subcontractors: Bill the General Contractor for the total cost of doing their work

3General Contractor: Reviews subcontractors invoices

4General Contractor: Submit a bill to the Owner/Client

5General Contractor & Owner/Developer: Review the General Contractor invoice

+8 more steps

View template

Example Procedure

Contract Review & Legal Approval Workflow

1Collect information

2Prepare quote/proposal

3Send Quote

4Proposal meeting

5Quote Variation

+4 more steps

View template

Conclusion

Now that you know the ins and outs of business process optimization, all that’s left is actually putting it into practice. Theory, after all, can only take you so far.

So, do this…

1. Identify weak or inefficient processes
2. Map it out
3. Analyze it. Find if there are any better ways of doing it
4. Optimize the process, by either restructuring it, automating it, or adopting some tech that will completely change the way it works

Have any other questions about process optimization? Did we miss anything important? Do let us know in the comments!

Related questions

What are the objectives of business process optimization?

Business process optimization is about streamlining workflows to make them faster and more efficient. Key goals are cutting back wasted time, minimizing mistakes, saving money, and making customers happier.

Think of it as tuning up a car: You get all parts working together at an optimum, consuming less fuel and providing a smooth ride.

What is process optimization in the workplace?

In the workplace, process optimization involves identifying and implementing alternatives to existing methods of doing work. It’s about examining how tasks are passed from person to person, and figuring out how to make them easier. In discussions with operations teams - particularly the 45% that come from enterprise organizations with formal procurement - this handoff optimization is consistently the biggest source of efficiency gains.

For instance, one could say that five people don’t have to approve a signed document - maybe only two need to check it. Or you could use software, instead of doing something manually, to do it automatically.

What are the focus areas of business process optimization approach?

The main areas of focus would be workflow mapping, identifying bottlenecks and roadblocks, automation possibilities, and staff training. You’re kind of like a sleuth - you look and see where the work is getting gummed up and where a lot of mistakes are made and where people are doing stuff that should be push-button.

You then try to solve these problems using either better tools or simpler steps.

What is an optimal business process?

A great business process is similar to a well executed dance routine - the moves just flow into each other and you don’t waste any motion at all. It’s a smart way to work with minimum resources and optimal results.

Everybody involved should understand how the operation works, and it should be simple to operate. It should also deliver the same results each and every time.

What are the major goals of process optimization?

The main objectives are to work faster, save money, provide better quality and make it easier to get workers’ jobs done. It’s not about working harder - it’s about working smarter.

When processes are streamlined, companies can provide better products or services and use fewer resources to do so.

How do you measure process optimization success?

The process of profile optimization is successful when key indicators such as less completion time, lower costs, less errors, and enhanced customer satisfaction are being tracked. You could monitor the amount of time tasks take, how many errors occur or how satisfied customers are with the end product.

What tools are used in business process optimization?

Contemporary process optimization is carried out using workflow software, as well as automation of tools and analysis solutions. They map processes, identify problems and measure improvements.

They’re the equivalent of using a super-powered microscope to zoom in on where and how work happens.

How often should businesses optimize their processes?

Optimization of the process should be continued and be carried out every few months. It’s gardening work, in other words - you’ve gotta keep your eyes peeled for weeds (inefficiencies) and adjust for changes in the weather.

Markets evolve, technology advances, and new challenges emerge, so optimization must be constant.

What role do employees play in process optimization?

Staff are essential when it comes to streamlining processes because they know the day-to-day work better than anyone else. They can also identify problems and offer suggestions for improvement that company managers might overlook.

It’s akin to having locals who know all the short cuts and trouble spots in their own neighborhood.

How does technology impact business process optimization?

Technology plays a critical role in optimising the processes. Today’s tools can automate repetitive work, automatically catch errors and offer detailed insight into how work flows.

It’s as if you have a smart assistant constantly making sure everything goes more smoothly, while making note of all the details.

What are common barriers to successful process optimization?

Key barriers include reluctance to change, lack of good tools, unclear goals and poor communication. And occasionally, people become entrenched in old ways of doing things, efficient or not.

It’s as if you’re trying to persuade someone to start taking a different way to work when they’ve been following the same path for decades.

How does process optimization affect customer satisfaction?

Optimized processes make a real difference to customer satisfaction by cutting wait times, improving service quality, and delivering reliable output. Better internal processes translate to faster, more reliable customer service.

It’s analogous to going from a slow, undependable delivery service to a service that is fast and always on time.