Thursday 14 November 2013

Business Process Improvement

Business Process Improvement (BPI) is an approach used to improve efficiency, quality, and response time of a business process, by removing non-value adding activities and costs through incremental enhancements. The overall goal of BPI is to determine problem causing processes and implement appropriate fixes. The demand for improving business processes increased in the early 1990s, after the Business Process Re-engineering (BPR) wave. It was realized that in order for a business to remain successful and profitable in the long run, its processes must be carefully examined.

Why is Business Process Improvement required?

In today’s struggling economy, more and more businesses are starting to realize the need to improve their processes and deal with the concerned areas. The long-term success of a business can only be achieved by gaining a clear understanding of its day-to-day operations and processes. No business runs perfectly without efforts to improve its practices. Often, businesses struggle in one way or another. For example, a business might be poor in customer services or they might have an outdated IT system. Also, there are competitors out there, who are determined to snatch customers away. Hence, in order to optimize its performance, a business must look into its existing processes and make improvements. 
Here are some of the objectives of Business Process Improvement:
  • To continually improve the productivity of business processes
  • To improve customer satisfaction
  • To improve the ability of an organization to anticipate, manage and respond to changes in the marketplace
  • To maximize business opportunities
  • To deliver products of better quality as a result of effective and efficient processes
  • To provide the organization with a competitive advantage
  • To maximize the use of its assets

What are the required steps to improve business processes?

An organization can undertake the below mentioned steps to carry out BPI:

Identify all key business processes – All the key business processes and their sub-processes are identified in this step. Process owners are interviewed to gather details of the processes. If required, stakeholders and experts too, are interviewed. All the processes identified are then prioritized.

Map and document the processes – In order to gain a better understanding of the processes, flowcharts and documents are created. 

Analyze the processes – Next, the processes are analyzed to determine costs and lead time. Problem areas are recognized and the benefits to be accomplished from improving processes are carefully considered


Re-design the processes to create improvements – The identified processes with issues are re-designed keeping in minding the costs, efficiency, lead time and return on investments. In this step, new prototypes of process flows might be created. Policies and procedures might be modified or some other change might be introduced. 



Test the processes – Here, tests are created to ensure that the re-designed processes work as planned and produce the desired results.



Implement the re-designed processes – The re-designed processes is implemented at an appropriate time in the business organizational structure and all the employees who are going to be affected are informed about this change before hand.



Perform continuous process management – All the business processes are continually monitored to check for their efficiency and any improvements if required. This is an on-going process.


Which are the existing methods for Business Process Improvement?

Some of the existing methodologies for Business Process Improvement are as follows
  1. Six  Sigma
  2. Lean
  3. Total Quality Management (TQM)
  4. Business Process Re-engineering (BPR)
  5. Rummler-Brache methodology

What are the challenges in achieving Business Process Improvement?

Business Process Improvement is not always easy to implement. It might turn out to be a tedious process for organizations. Here is a list of challenges which businesses might face:
  • Produces too much data in a manner which is difficult to comprehend
  • Gaining sponsorship from senior management while implementing large-scale changes
  • Overcoming traditional ways of thinking
  • With many different BPI methodologies available, agreeing on implementing one particular method becomes difficult
  • The risk of implementing changes is higher now, and the pace of change has also become higher
  • Higher cost pressure on organizations
As described above, Business Process Improvement (BPI) is an important approach to help businesses adapt to the changing market needs, stay up-to-date with latest technologies and provide a competitive edge. Higher performance and increased profits can be achieved by implementing BPI.

About Author:
Onkar Lalla is a Consultant and an important part of the Systems Plus Pvt. Ltd.  think tank. Within Systems Plus, he actively contributes to the areas of Technology and Information Security. He can be contacted at onkar.l@spluspl.com

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