This multi-part blog post series presents practical answers to frequently asked questions on improving business entities.
Its objective is to assist business leaders in these trying times, whether they are learning the basics of business process improvement, planning their first business improvement project, or evangelizing process-oriented thinking throughout their organization.
So, let’s get started…
Business process management is management of various activities involved in an organization, such as- identification, evaluation and improvement in various processes of a business.
Businesses tend to use this action in order to assess and increase productivity, business efficiency, sales, customer satisfaction and overall business performance.
Pareto’s 80/20 business process management (BPM) methodology suggests that 20 % of managed activities should bring forth 80% of beneficial results.
While there are several advantages of Pareto’s 80/20 BPM methodology, there are few potential challenges too, for example - its sustainability.
If a business’s revenue or profit heavily relies on specific clients, then their decisions will have a huge impact on the business’s value. This can be especially harmful if the business relies on a small group of individuals as ‘clients’. In case of loss of a single client, business income and profit could take a giant blow.
The way to solve this issue is to find ways of making profit away from the group.
Categorizing the top clients and finding attributes that they all have in common is a sure way to mitigate risks. It will then be easier to look for clients that fit the same format. Higher the number of individuals making up ‘important client’ list the better.
Another challenge with Pareto’s 80/20 rule is that it can be difficult for companies to know when they should apply the rule, and when not.
Pareto’s 80/20 rule can also be a drawback for a company’s workflow. While it is meant to eliminate activities that waste time and draw focus to the real goals, implementing the rule could just get in the way of methods that are already functioning effectively.
Check out more about Pareto 80/20 rule and eighteen different business process improvement techniques here.
I shall discuss more FAQs concerning effective & efficient business process improvement in the upcoming parts of this blog series ...
By the way, if you run a company that is facing a challenge to thrive in these difficult times, I would suggest that you please revisit your business processes in order to accelerate growth and bring a quick turnaround.
So, let’s get started…
Business process management is management of various activities involved in an organization, such as- identification, evaluation and improvement in various processes of a business.
Businesses tend to use this action in order to assess and increase productivity, business efficiency, sales, customer satisfaction and overall business performance.
Pareto’s 80/20 business process management (BPM) methodology suggests that 20 % of managed activities should bring forth 80% of beneficial results.
While there are several advantages of Pareto’s 80/20 BPM methodology, there are few potential challenges too, for example - its sustainability.
If a business’s revenue or profit heavily relies on specific clients, then their decisions will have a huge impact on the business’s value. This can be especially harmful if the business relies on a small group of individuals as ‘clients’. In case of loss of a single client, business income and profit could take a giant blow.
The way to solve this issue is to find ways of making profit away from the group.
Categorizing the top clients and finding attributes that they all have in common is a sure way to mitigate risks. It will then be easier to look for clients that fit the same format. Higher the number of individuals making up ‘important client’ list the better.
Another challenge with Pareto’s 80/20 rule is that it can be difficult for companies to know when they should apply the rule, and when not.
Pareto’s 80/20 rule can also be a drawback for a company’s workflow. While it is meant to eliminate activities that waste time and draw focus to the real goals, implementing the rule could just get in the way of methods that are already functioning effectively.
Check out more about Pareto 80/20 rule and eighteen different business process improvement techniques here.
I shall discuss more FAQs concerning effective & efficient business process improvement in the upcoming parts of this blog series ...
By the way, if you run a company that is facing a challenge to thrive in these difficult times, I would suggest that you please revisit your business processes in order to accelerate growth and bring a quick turnaround.
Related reading:
- Kaizen for pharmaceutical, medical device and biotech industries.
- Business process improvement techniques for manufacturing and service industries.
- How to choose a business process improvement technique for your organization.
- 30 Popular continuous improvement tools.
- YouTube #Shorts videos on Continuous Improvement.
Keywords and Tags:
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#advantagesandisadvantagesofparetorule
