Business Process Improvement

The majority of business process improvements were developed in the manufacturing arena but the core techniques and principles remain transferable across most industries today.

Business process improvement focuses on ensuring that functions are done correctly, by reducing waste for example. We begin by defining the strategic objectives of an organisation, targeting the customers of that organisation and making the business processes in line with those objectives.

BPI tends to look at a radical change in the business performance rather than a slow change approach. Change is not intended to be trivial but rather a revolution. Re-engineering is a term often associated with these changes.

Businesses process improvement looks at the primary roles in a business, the management system, the business leader, the process owner, the operation manager and the process operator. Each has a unique set of responsibilities but all need to work together as a unit. The business leader creates the business plan which was devised through the strategic planning process. They communicate the the business plan through the organisation, they build communication bridges and remove barriers. They analyse the performance of the business and use management data to guide the business to ward its objectives.

Meanwhile the owner of the business process is the person who designs the processes necessary to achieve the objectives set out in the business plan that was created by the business leaders. They create and approve the documentation that supports the process. They are often supported in this work by the process improvement team. The starting point is to understand the customer requirements which translate into a set of metrics overseen by the operational managers and are commonly known as KPIs or key performance indicators. These are what measures that the customer requirements and expectations are being met.

The process operators analyses the performance data to review the performance of the process. They create performance improvement plans based on that performance data and this may include Lean practices to reduce waste such as Six Sigma. Improvement plans include risk analysis to identify problems within the process and mitigate against their consequences.

Meanwhile the operational manager brings resources and process together to deliver the targets set out in the business plan. This follows a classic plan, do, check and act cycle. Finally the process operator performs the work needed to achieve the objectives of the business plan again using the do, check and act cycle.

Processes need to be in line with business goals. Customer needs to be at the centre of business process improvement and results need to be regularly benchmarking to be able to measure improvement and progress.

Are There Risks With Business Process Outsourcing

One of the most attractive aspects of larger businesses is the ability to outsource some of the functions of daily business processes in order to save money. While this might make good financial sense instead of hiring new employees, there are also some risks with business process outsourcing.

When most companies are beginning or are growing, a lot of the processes of daily business are done in house in order to save money. Things like customer service, accounting, human relations, data management and more are often falling on the backs of a few employees. This saves money for the small business owner, however when the company begins to grow and expand, most business owners are faced with the decision of whether to hire new employees or seek outside specialist to handle certain aspects of the business.

Business process outsourcing (BPO) is the method that this is accomplished. While using an accountant do take care of taxes and payroll makes good sense, are there problems with outsourcing other aspects of your business?

One such risk with BPO is the risk to current employees. Unless you have one employee handling multiple tasks, will that employee or those employees have to be fired or laid off? Often times you can merge the employees into other aspects of the daily business model in order to keep those that are familiar with the company employed.

Another risky aspect is outsourcing the IT management of your company. If your company sends its data to a third party, can you ensure that it is secure from data breaches? What about other data? Can it be easily recovered and secured if you need it? Do you have a redundant backup plan in case of failure of your data and the outsourcing parties data?

There are many aspects to consider when outsourcing, these are just a couple of the bigger ones to consider. You can often tell when it is time to consider going outside of your business walls for support. Finding the right company to provide the services you need will take time and effort on your part, but the dividends will become more evident everyday.