One of the first people to describe business processes was Adam Smith (1776) in his famous example of a pin factory. Since then business processes have evolved and better defined. A business process defines the various activities involved in achieving a particular goal. Business processes briefly describe the chain of events that are involved in an activity or a group of activities. It is common to use a business process if the activities have an effect on current products or data and bring about production.
Types of business processes include-
- Management processes such as Corporate governance, Strategic management, planning and implementation.
- Operational processes, which constitute the core business and create primary value stream. Typically, they include Procurement & sourcing, Manufacturing, Marketing, Sales and Customer service.
- Supporting processes, which support the operational processes and include Finance & Accounting, Recruitment & Human Resources Management, Research and Technical support.
Some examples include invoicing, product shipping details, updating information, tracking orders, allocating budgets etc. Business processes used throughout organization, at any level, are outlined in order to improve organization in an effective and efficient way. There can be several inputs in a business process but there is always only one output or specific goal- that is to help business thrive.
Business processes are used practically in any organization and throughout an organization at any level. They are used in a variety of industries such as private, public sector, government, departments, hospitals, charities etc. Business processes are, typically outlined in order to improve an organization in an effective and efficient way.
Various computer software make it possible to create business processes on a computer, however simple business processes are just as effective when written with pen and paper. Some even find it better to jot down the processes on a piece of paper, or on several small ones, in order to kick start their creativity and thinking process. It is up to the professional (and/or organization) to decide whether a software or traditional method will work best for them. Business processes work best when there is input, support and ideas from various people that are involved in the organization (or department).
Key business processes are logically grouped related tasks and activities, independent of the organization’s structure, which utilize the resources of the organization to produce specific results. They possess measurable inputs & outputs, value addition and repeatable activity.
Tip- The effective management of key business process requires- Ownership & planning, performance metrics & control, process qualification, management and improvement methodology.
A business process always begins with a customer’s need and ends with a customer’s need fulfilment.
Customer needs change, technologies change, government policies change, competition changes and what used to be a high level of performance becomes a poor one and it’s time to replace the formerly good process with a new one- only every process cycle should have this capacity of identification, in-built in its charter.
As a practicing Business Transformation expert of many years, I am happy to mention here few case studies, nay success stories. Let me share three examples-
- A consumer goods manufacturing company redesigned its product deployment process, by means of which, it now manufactures goods and delivers them to its distribution center such that inventory uptake was reduced by 35%, while stock-out goods situation declined by 70%.
- A pharmaceutical company created a new product development process, which reduced time to market by 75%, development costs by 45% and increased productivity by 30%.
- An engineering goods manufacturing organization increased its product delivery targets by 350% and reduced its supply chain costs by up to 55%. Something to note in these is the simultaneous achievement of apparently incompatible goals for e.g. reducing inventory while also reducing out –of-stocks.
Traditional organizations view these as conflicting goals and trade off against another. While process managed organizations, recognize that such payoffs, are achieved by improving business processes and continually maintain their business process efficient. So how do we go about bringing on a process change?
Three main categories of business process improvement techniques, have been found to be extremely effective in managing, expanding and /or transforming businesses worldwide including USA, Canada, Latin America and the emerging economies. They are – Breakthrough improvement, Streamlined improvement and Continuous improvement. The 18 methodologies described in this book belong to one or many of these three main categories.
In this book, you will learn about:
- What is a business process? What are different types of business processes? Why improve a business process?
- 18 different business process improvement methodologies including Lean, ISO, Kaizen, Six Sigma, Capability maturity model integration (CMMI) etc.
- Advantages of each business improvement methodology. Precautions needed before implementing a methodology at your workplace.
- Strategic planning and risk assessments involved prior to implementing a business process improvement methodology.
- References of their use by startups, small companies who later on became big corporate houses and Fortune 500 companies.
- Tips to maximize positive results from executing business process improvement methodologies for your organization.
This book presents a practical way to build and improve business processes, and assists professionals whether they are learning the basics of business process improvement, planning their first improvement project, or evangelizing process-oriented thinking throughout their organization.
This book is for Agile entrepreneurs and business leaders involved in decision-making, directing their organization’s sustainability, profitability, and expansion. If you want some new ideas for improving your business and need to get your team involved, then this concise self-help, business management book is for you.
This book is also for professionals who are interested in making a career change and wish to embrace business process management (bpm) role.
This book is also for graduate students, budding out of colleges and are in the process of stepping into the industrial world- be it manufacturing or a service industry. This book helps them learn the various methods by which they can improve their company’s business, which in turn would help their career growths.
This book is for all ‘business book readers’ who wish to apply business improvement methodologies to their work place in most beneficial and practical ways.
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About the author Shruti Bhat PhD, MBA, CLSSBB
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