Business process improvement
Reinventing your core processes
In the day-to-day swirl of our work and lives, we seldom see the Big Picture and patterns at work. There is great value in taking a birds-eye view of the core business processes in order to identify improvements. Here’s how to review and reinvent your own core processes and functions in just four steps:
- Identify your core work functions—from 3-7 is usually a good number for most professions or businesses.
- Identify the priority goal of each function. Express as an output—not input.
- For each major function, identify the core processes or steps required to reach the goal.
- Reinvent each major function or process by asking yourselves how to do it better, cheaper, faster, and smarter.
Any number of quality management tools and similar can be used for this work. See the consulting resources page for more information to help. The APQC Process Classification Framework will help you enormously. It is important to map the core processes well, gaining agreement from all involved on the validity. With an open and honest review, along with active involvement of appropriate staff, you will get to know things about your business you would not have believed!
Extending your business process improvements
Here are some sample core processes for a human resources (HR) strategic business unit. The vertical silos are those functions that you can identify most easily in any organisation. We all know what a silo is, right?! The skill, however, is to map the actual business process that works its way across and through each relevant function (silo). It is not unknown to have processes that double back on themselves for signatures or other obscure bureaucratic needs! Be creative and analyse just what is going on in your business. Hold out for good answers for sensible enquiries, and keep at it for real breakthroughs. Like magic, business processes can appear like smoke and mirrors until you find out how it really works, and why your processes cost so much. Prepare yourself for some surprises!
Activity-based management (ABM)
Using the same process starting point, an activity-based management review and analysis can result in extrememly valuable, and insightful information. This topic will be expanded in a later article, but for now, it is useful to see where you can creatively go to better understand and measure your business processes. The columns in this spreadsheet represent a head office and its strategic business units (SBU). The rows are core business processes with the total input costs for the equivalent manhours (personhours?!) spent on each process for head office and the SBUs. A useful and enlightening alternative to those typically dull financial/accounting reports based on costs.
Much more to core processes of course, and all the above sample models and approaches can be integrated at your company board reporting level and rolled out across the company. By achieving such strategic management control, your company is best positioned to accurately measure its performance, achieve real growth, and take advantage of any opportunities that arise—whatever the economic situation. What gets measured, gets done!