BUSINESS PROCESS IMPROVEMENT- AN INTRODUCTION
The modern era has transformed multiple aspects of human life and interaction. Businesses are not an exemption from this. In the modern era, owning and managing a business is a continuous and proactive process.
The job is never finished with the mere establishment of the business and implementation of operations. In today’s age, the longevity and effectiveness of a business rely on its ability to always keep up with the trends, be open to innovation, and flexibility to the ever-changing climate of service demand, production, delivery, and consumer behaviors.
To ensure a business's stability or ability to stay afloat in a rapidly changing environment, there is a need to keep a pre-emptive and proactive attitude when dealing with business operations. There is a need to be constantly eager and open to making rapid improvements, always to be ahead of competitors and ensure success.
This is where Business Process Improvement comes in. This article is an introduction to business process improvement and its types, why it is essential, and some benefits of incorporating a plan and strategy for implementing business process improvement on any business model.
What is Business Process Improvement?
Business Process Improvement (BPI) is where business owners or managers review and analyze their business model and its current practices to identify challenges and areas of improvement to come up with ways to address these challenges and areas of improvement.
Business Process Improvement aims for business owners or managers to review their current business model and assess its performance, productivity, strong and weak points, and overall advantage against competitors or edge in the market.
After constantly identifying all these good points from a macro perspective, the next task is to go and make an assessment from a micro perspective. The micro perspective involves the inner process, including work departments and the production line, depending on the kind and nature of the business.
Business Process Improvement aims to encourage and help business owners or managers identify possible or underlying problems in their current business models and develop ways to address them. It also demands them to predict possible challenges and concerns and devise ways to prevent or preemptive solutions on several scenarios. It also aims to redesign and innovate strategies to implement effectiveness, enhance working practices, and optimize overall performance.
The Importance of Business Process Improvement
To fully get on board with the idea of Business Process Improvement, here are some reasons why adopting a particular type of Business Process Improvement is essential.
To further understand the business and the current market environment
Incorporating Business Process Involvement as a standard business practice would entail business owners and managers staying updated with the current market situation. Because there is a need to review business performance constantly, owners and managers are now highly encouraged to keep themselves updated with the upcoming market trends and up-to-date models and systems that can help with the efficiency and productivity of a business.
By employing a specific type of Business Process Involvement, business owners and managers can now constantly need to keep track of the current trends and improvements in their industries. It is also a way for businesses to have a constant overview of various business factors that can aid them in developing varying aspects of their overall performance.
By adopting or developing a particular type of business process improvement, business owners and managers can keep track of the business's actual performance and identify strong and weak points in record time. In turn, they would be able to address present issues and prevent future mishaps.
Adopting a particular type of business process improvement allows business owners and managers to come up with solutions and preventive measures to apply to a wide array of scenarios that the business may encounter, whether that’s in overall change in market trends and consumer behaviors or development of production, delivery and service techniques.
2. To maximize resources to reach optimal gains and minimal losses
With Business Process Improvement, business owners and managers would learn and explore options to maximize their current resources. It will help owners and managers to be creative with employing new methods to ensure efficiency and productivity using their current resources and manpower.
By adopting a particular type of Business Process Improvement, business owners and managers can develop access to the actual daily operations of the business and identify its strong points and areas of improvement. This can help business owners and managers create strategies and consolidate its application with their current resources. This would entail efficiency and the ability to maximize the resources the business currently has, be it production and service methods or manpower.
3. To ensure the stability and sustainability of the business
Adopting a specific type of Business Process Involvement could help ensure
the stability of sustainability of the business. This is because business owners and managers acquire an in-depth control and understanding of the inner workings and elements of what makes the business work.
By incorporating a specific type of Business Process Involvement, business owners and managers now have an actual guide on how to develop improvement and strategies to ensure that the business is in top performance, and it can now be proactive in addressing key issues and challenges. Because of this more proactive approach to dealing with the business, its stability and sustainability can now be effectively established.
Looking at notable stories of how and why several businesses had failed in the past, the most common reason is that its owners and managers lacked a sense of foresight. Once the business model and operations have been proven effective and have been known to show results continuously, they take a back seat and let the business continue until it runs out of steam. There was no sense of improvement and maintenance on the part of the business owner and manager.
There is also the common mistake of people seeking comfort and confidence in working methods. For most people, it is already sufficient enough that something is already working and has been proven effective. People hesitate to challenge current working methods and decide to leave the matter entirely. And because of this expected behavior, business owners and managers have missed opportunities to get on board with a current trend or take advantage of specific options that could’ve upgraded or transitioned the business.
Eventually, the lack of inner involvement with the company's overall operations and the reluctant business owners and managers' reluctance to adapt to changes led several businesses to decline and eventually close. This is a mistake that adopting a Business Process Improvement avoids. This is because it demands business owners and managers to be proactive and creative in dealing with all business areas.
Take the story of Blockbuster and Netflix, for instance. Blockbuster has been a game changer in the home entertainment industry by providing video rental services. For a good period in the early 2000s, they generated sales and became extremely popular. On the other hand, Netflix has come up with a far more creative way to compete in the home video industry by spearheading video on demand by delivering video straight to homes.
With the advent of the internet, Netflix took advantage of the potential of the internet by taking several aspects of its business online. The problem with Blockbuster is that it missed its mark on reconsidering its business model with the advent of the internet. Due to the lack of employing a Business Process Improvement model, Blockbuster missed its mark and eventually went on its decline. Meanwhile, Netflix has become a staple in 21st-century entertainment as it has adopted measures to constantly keep itself on board with current trends and measures to keep the business afloat.
Types of Business Process Improvement
There are three common business improvement types: operational, supporting, and management. These are the three main areas where a particular type of Business Process Improvement should be implemented to ensure the efficiency and productivity of a business. All businesses have operational, supporting, and management aspects. It is first essential to identify these three aspects to fully identify what kind of Business Process Improvement should be adopted.
Operational- BUSINESS PROCESS IMPROVEMENT
This is the front and center of business. At this point, it is now critical to ask these questions:
What is the business?
What does the business create or provide?
What is its purpose?
How does the business work?
Answering these four questions will now serve as a guide in developing questions that will open the creation and development of an Operational Business Process Improvement plan. The answers to these questions will now lead to the next set of questions:
How does the business generate profit or deliver its services?
How is the overall performance of the business in recent months?
Has it generated more profit/produced more products or services in those recent months?
These leading questions will now lead business owners and managers to look closely at the operational aspect of the business. This, in turn, will lead them to analyze factors and data gathered to answer these questions. These are the preliminaries in Operational Business Process Improvement. It deals with the overall production and performance line of the business and deals with how to improve the daily operations of the business
Supporting- BUSINESS PROCESS IMPROVEMENT
Supporting Business Process Improvement deals with what makes the business's daily operations possible: this area concerns personnel and human resources. The backbone of the operations. Some leading questions to ask are the following:
What categories and types of personnel does the business currently have?
What is their role in the operations of the business?
Are their roles indispensable in the business?
How was their performance in the past recent months?
The aim of Supporting Business Process Improvement is to maximize personnel performance to attain the goals and production targets of the business. This is where business managers and owners would make critical decisions on either adding more personnel, trimming it down, or whether automation could be a better option. This is the type of Business Process Improvement that forms the critical link between management and operations.
Management- BUSINESS PROCESS IMPROVEMENT
This type of Business Process Improvement deals with actual business strategy and decision-making that would be vital for the sustainability, effectiveness of the business plan and overall performance. A Management Business Process Improvement requires business owners and managers to revisit and assess their performance in dealing with the decisions and strategies it applied to the business and its overall effect.
This type of Business Process Improvement is where business owners, managers, and officers would have to be assessed based on their capability to continue and eventually improve the business model.
Benefits of Business Process Improvement
Adopting a model for Business Process Improvement may seem to be a daunting task and may take a lot of time or resources. However, that is not the case. Business Process Improvement can make business operations and management more convenient and efficient and optimize performance. Here are some benefits of adopting a model for Business Process Improvement:
A Clearer Picture of the Business
Adopting a model or a procedure for Business Process Improvement helps business owners and managers have a clearer picture of the business, its daily operations, personnel performance, and management style. Because Business Process Involvement involves giving these areas a closer look, owners and managers become more familiar with the entire machinery and operations.
2. Creating Accurate Predictions, Measures and Solutions
Because business owners and managers have a better and more precise picture of the business process and its operations, they can now create accurate solutions and measures to ensure the business runs smoothly.
Because with Business Process Improvement, owners and managers are now aware of certain features and measures unique to the business and can create options and solutions tailored to its specific needs. Since there is a need to review the business’ overall performance constantly, owners and managers are also in touch and up to date with current trends and options that can help enhance the business.
3. Ensuring Stability, Efficiency, and Maximising Resources
The only way to improve anything is to understand it better. Business Process Improvement, it ensures that business owners and managers would use their acquired knowledge of the factors concerning the business and its inner workings, including its strengths and weaknesses. They can use these factors to ensure the expansion and stability of the business.
Because Business Process Improvement demands business owners and managers to keep reviewing the workings and operations of the business, it can now maximize its current resources. Business Process Improvement challenges all the sections of the business to make the most of their current resources to beat and improve current standings.
Therefore, owners and managers maximize their resources and would be able to save on costs when they can keep on finding ways to improve performance and operations by being creative with Business Process Improvement.
A Scenario- BUSINESS PROCESS IMPROVEMENT
Let’s look at this further with an example:
Jim owns a local bakery and cafe, “Jim’s Bakery and Cafe”. In his local area, there are two other cafes. The first is called “The Pastry Shed,” and the second is the “Coffee Lounge on 5th”. The establishment has been performing decently and has attracted a handful of regulars. But despite this, the business is only making breakeven. Jim then asks why his business isn’t performing as well as expected. The quality of the food and service has good reviews. One day, out of frustration and constant disappointment, he set out to assess his business.
First, he assessed the performance of the business. He looked at the monthly customer flow, the performance and efficiency of the staff, and the overall quality of the products they were serving. He then proceeds to look at the other similar establishments in the area and observed their business practices. He looks at the reviews being made online. He dined in these establishments to compare the food and service quality, and he noted them.
“The Pastry Chef” has decent food but has a well-decorated area where the customers couldn’t get enough of taking photos. Despite the decent food quality, the customers keep coming in because of the place's ambiance. It is also quite popular on social media. Meanwhile, the “Coffee Lounge on 5th” is a small establishment. It has a small menu but evening entertainment and a very good and accommodating staff.
Second, he proceeded to make a comparison of what he had noticed with the two cafes and with his own business. He noticed that “Jim’s Bakery and Cafe” has an excellent menu and various products. However, the ambiance of his place is more of a regular diner which younger customers are not interested in, and he only has a limited wait staff which is why it takes some time to get some errands done in the cafe. He noted that his strength is the quality of the food he serves and the location of his business. He figured that his biggest challenge was how to draw all kinds of customers.
Third, he revisits his business structure. He consulted on how many people he needed to hire to get the place up and running. He asked around for the costs of improving the overall ambiance of the place. He devised a theme that he knew would cater to all customers and explored options for getting onto social media to advertise his business. He proceeded to document snippets of their day at the cafe and bakery, eventually gaining attention online.
What Jim had done here is a form of Business Process Improvement. He first identified problems and areas of improvement and carefully compared them with his counterparts of what is perhaps lacking in his model. In the scenario, he combined the vital point he had noticed from his counterparts and eventually developed a tailor-made plan for his business. This, in turn, gradually improved his business operations, and is now on the way to increasing profit.
Remember- BUSINESS PROCESS IMPROVEMENT
Business Process Improvement is not mad science. It is an act of actively making a careful and thorough assessment of the business and developing new ways of improving it to attain sustainability, efficiency, and profit. If anything, most businesses do tend to have a habit of making reviews and assessments from time to time for various reasons. However, there is a need to have a far formularized system in employing Business Process Improvement in any business, as consistency is key to attaining success.
Therefore, it is highly advised that businesses should employ a Business Process Improvement model so owners and managers can keep track of actual improvements and developments. In turn, they can create an enforceable plan that can be shared with everyone involved so they can be informed about the actual goals of the business, and everyone can carry on with their tasks with a clearer image in mind of what to attain. This way, businesses will be more organized and proactive with their affairs.
Business Process Improvement - An In-Depth Overview