Business processes are rarely all that efficient. Most businesses don’t do a lot of retrospection, following the logic of “why fix something that isn’t broken?” Instead, most companies tend to focus on sales or marketing as a means of reaching higher profits. Business process management, however, allows for both better profits, as well as lower costs, simply by optimizing whatever the company is already doing.
So, What is Business Process Management?
Business Process Management Software (BPMS) & Workflow Management Software
Chances are, you’ve probably heard of business process management in the context of software – an accompanying tool used to make the methodology easier to implement. The main difference between the two is that BPM is a methodology of mapping, optimizing and improving processes. BPMS, on the other hand, is a means of carrying out and enforcing the changes. BPMS software allows you to map out your processes with flow charts, as well as enforce them through work routing. Business process management has been around for a while and has always been a tool specifically used by enterprises. The tools tend to be extremely complex, requiring a team of IT specialists to set it up and experience process analysts to make it work. Workflow management software, on the other hand, is a spin-off of BPMS. It’s a more compact, SaaS solution which essentially deals with the same thing: mapping , optimizing and improving processes. Workflow management can be good for business both small and big, as they’re a lot easier to use or setup. The main differences between the two are…- Ease of Use. BPM needs a team of IT specialists and process analysts to get it to work. Workflow management, on the other hand, is built for your average user to understand.
- Coding & Integration. To customize a BPM solution, you’d need to have engineers tinker around with the code. Workflow management allows for easier integrations with 3rd party tools.
- Target Market. BPMS is tailored towards corporate needs. You’d need to contact the solution provider and coordinate with them to make it work for you. For workflow management, you’d register online and set it up yourself to work for your organization, making it the favorite of the smaller businesses.
Business Process Management Benefits (Or, Why You Should Care)
Over half of all businesses now view business process management as extremely important due to the increasing return on investment many companies are seeing. It is important to look at both the short-term and the long-term benefits of business process management. The most glaring-obvious & tangible benefits are the effects on the company bottom line…. Higher Profits – as BPM leads to improved business processes, the organization will end up being more productive, eventually leading to higher profits. Lower Costs & Expenses – efficient processes tend to lead to lower manufacturing expenses. A lower defect rate, for example, or a better use of resources would lead to lower expenses across the board. There are, however, some benefits that are a lot more important (and a bit hard to actually spot or measure)… Improved business agility – BPM involves continuous re-evaluation and adaptation of processes. This makes the organization used to on-going changes, leading to a much higher business agility. Which, of course, leads to a much faster decision-making & change management processes, allowing your business to stay competitive within the industry. Reduced Risks & Process Consistency – Any successful BPM initiative involves business process mapping – the act of putting down your processes on paper or software. By having an exact step-by-step documentation of a process, your employees are always aware of the “right way” of doing things. This leads to a much lower risk of human error. Improved Customer Satisfaction – Whether you’re a service or product oriented company, you’re very likely to deliver a better product through BPM. Lower product defects, for example, lead to lower customer complains. Or, in case of service, an optimized client onboarding could show the customer you care more. And of course, a good product or service means a satisfied customer. Employee Satisfaction – Business process automation goes hand-in-hand with BPM. One of the most common ways of improving business efficiency is by automating menial & simple processes. This allows your employees to focus on the “real” work, leading to high job satisfaction.Implementing Business Process Management: Step-by-step Guide
Now, you’re probably wondering, “where do I start?” Well, for successful BPM, all you really have to do is to continuously improve or reengineer your processes. Meaning, you pick several critical or weak processes and start regularly carrying out BPI or BPR initiatives. While there are a lot of different ways or methodologies to do either, the simplest way is to follow these 5 steps…Step #1: Forming a Team
Whatever your position at the company is, chances are, you won’t be able to carry out the entire initiative yourself. You’ll want to create a dedicated project team to work on the specific process. The team should consist of…- Senior Manager. Change management tends to be extremely slow. Whatever changes you’re going to make within a process, you’d want to have a green light from the senior management of the company. Having someone from the higher ups can make the decision-making and approval processes a lot simpler.
- Operational Manager. As a given, the person that works mostly with the process is someone you’d want to consult with. In most cases, that would be the supervisor working on the process. They have an easy access to the field level employees, who can be extremely helpful with their input on potential improvements.
- Reengineering Experts. If you’re going with BPR, you’re going to need some technical staff to help with developing new solutions. These tend to be either software or hardware engineers.
Step #2: Mapping
Business Process Mapping, as the name implies, means creating a “map” of a certain process. This is usually done using flowcharts (often used for workflow diagrams) or other graphing methodologies, such as the value stream map. Mapping helps get a better look at the process from a top-down view perspective. After all, how can you find out how to improve a process, if you don’t know what the exact steps are? There are 3 different ways to do this…- Pen & Paper. The simplest way is to just grab a pen & paper and draw a flowchart describing each step within the process.
- Flowchart Software. Dedicated software used for mapping processes.
- BPM Software. BPMS has all the capabilities you’d need for BPM, graphing tools included.
Step #3: Analysis
Once you have a process map to look at, you can start with the analysis. This, of course, can be very different depending on what type of process you’re working on. Generally, though, you’d want to ask yourself questions such as…- Are there any steps that seem to be lagging? Are they taking more time than what would be reasonable?
- Are there frequently missed deadlines? Delays? What might be the main reason for that, and is there a way to fix it?
- What are the most important steps in the process? What sort of impact do they have on the end-product or process? Is there any way to improve them?
- Are there certain processes that are costing the company too much? Why, how, and is there a cheaper way to do them?
Step #4: Redesign (Improvement or Reengineering) & Implementation
Once you have a clear idea on what you’re going to improve on, you’d want to redesign the old process and finally implement the changes. While the exact redesign depends on your own specific case, there are some best practices you could follow to help make the process work better…- Pick Benchmark Metrics. There’s no point in even carrying out a BPI initiative if you can’t measure the results.
- Consult Field Workers. The team that’s actually working on the process tend to have an idea or two on what to improve. Asking them might be both priceless for your cause, as well as good for employee morale.
- Define the Scope. What, exactly, could your new changes have an effect on? You might end up improving one process but unknowingly weaken another.
- Account for Long-Term Issues & Risk. If the new process is working well now doesn’t necessarily mean it’ll be beneficial in the long-term. A higher output rate, for example, could come with a higher product defect rate.