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Everyone will tell you what their business processes are in their company. Identifying the top 10 core business processes is the easy part. Defining, measuring and managing your business processes is the hard part. When I go in to audit a company’s processes, few companies have actually defined their business processes in sufficient detail to demonstrate that they can manage them to achieve real business results. Why is business process management so hard?
Business Process Management (BMP) Defined
Managing business processes requires a complete understanding of the process. How are your processes determined, defined, and communicated? How are your processes monitored, measured, and controlled to deliver planned results? When an auditor comes in to assess your business process management they are looking for four things.
- Are company processes defined?
- Are organizational processes monitored?
- Are workplace processes measured?
- Are your business processes controlled?
Company Process Definitions
Your company processes can be defined using a number of methods. The simplest is to use a process map to depict your main business processes, the sequence and interaction of each process step in a business process, or to communicate the process conversion steps that occur to turn the process inputs into outputs. A well defined process means to identify the main elements of the process: the process owner, process inputs & outputs, key process steps, and criteria, measures or requirements. When we are talking about PDCA (Plan, Do, Check, Act), process definition is part of the (P) planning step.
Organizational Process Monitoring
Just having a process defined is great but, your process is intended to produce a result too. Your shipping process is intended to distribute your products to your customers. Someone needs to monitor the process to make sure that your products are getting to your customers. Usually this is the process owner or somebody in management. Process monitoring ensures the process produces outputs, but it may not ensure that the process produces good output or achieves the planned results. Process monitoring is part of the (D) Doing step in PDCA.
Workplace Process Measures
To achieve planned results you must measure the process and take actions to move wayward processes into producing good outputs. What does “producing good outputs” mean? It means you must measure the right stuff. Monitoring your processes is important but if you don’t measure the right things then you may not get the right results either. Measuring requires that you have a target or goal defined. Common goals include On Time Delivery, % order complete and accurate order fill rates. Measuring is all about comparing your collected data to the target. Process measures are part of the (C) Check step in PDCA.
Business Processes Control
Are your processes effective? Process control is all about taking action to ensure your process is effective and achieving planned results. This means you have to have a defined process in place that establishes that the process is monitored, your process is measured against a target, and you have the ability to take action to correct your process from producing bad results.
Process control is the goal of any process measurement activity. It is the focus of the process approach of the ISO 9001:2008 quality standard. Process control is part of the (A) Act step in PDCA. If you are intent on real business process management, then business process control is what it is all about.
Making Business Process Management Easier
Many business processes are poorly defined, but this can be fixed. Start by creating process maps for all of your core business process. Creating process maps is the first step to improving your business process management.
Most business do not do a very good job of monitoring their processes. Do you know what all the defects are that can and do occur with your core business processes? Using your process maps to identify critical data to monitor is the next step in your business process improvement journey.
If most businesses do not have process maps and do not monitor their processes, then how did they determine the measures for their business? And if the measures do not come from your process maps and your monitoring, then what kind of a measure is it? Predominately lagging measure of success like revenue, profit, or inventory turns. What you need are some leading indicators of success like new customer formation, repeat business (which leads to lifetime customer value), or sales cycle closing time.
Your PDCA cycle culminates in taking appropriate action, but what’s appropriate is relative to the measure of success you are following. Follow the wrong measures and your perspective of appropriate actions changes. Finding measures to your business is a lot easier once you have followed a PDCA path of define processes, monitoring processes, and then measuring your processes.
The whole journey builds on itself and requires that you follow each step. Skipping steps may feel like you are saving valuable management time but in reality, you will end up following measures that will lead you to take less appropriate actions over time and thus cost you more in the long run. What’s hard about business process management is understanding what appropriate actions are that you need to take to correct your processes back towards achieving planned results.
Don’t skip steps. Plan, Do Check, and Act appropriately. Achieve planned results. That’s the formula for business process success. Download free sample policies and procedures to see how it’s done. Then order department policies and procedures that you need to improve business process results in your company.