There is a ton of skepticism around improving business processes. Some managers think it's a buzzword, others that improving operations is too complicated. So it’s better to not drag the team into it.
Other than that, business owners often believe that if something works there’s no need to change it. “If it ain’t broke, don’t fix it” - a popular saying goes.
Fixing processes only when they break is an inefficient strategy. Even if you put out the fire unless you find what started it, a new one will start. The same is true for business processes. If you don’t dig into the root cause of operational challenges, bottlenecks will keep coming.
Most business process improvement strategies fail - but we should keep trying
Before we begin, one thing needs understanding - getting to the finish line will not be easy. According to a McKinsey survey, 70% of large-scale business improvement initiatives fail.
Those who reach the objectives of business process improvement don’t have it easy. 19% saw only minimal improvements even after a complicated implementation process.
Before you start planning your own strategy, let’s determine why so many initiatives fail. These are the reasons most executives list as the key pitfalls.
- Lack of understanding of what improving business processes means.
- Resistance to change from the team and project stakeholders - CEOs have a hard time communicating the importance and value of re-shaping processes.
- No statistically significant data to help determine whether a business process improvement strategy was a success or a failure.
- Complex and time-consuming implementation strategies.
- Struggling to scale improvements and make change last.
Today, we will discuss the meaning of business processes. We will also offer some process improvement examples and share resources worth reading. Let's get started.
What Is Business Process Improvement?
Business process improvement (BPI) helps organizations improve the accuracy and efficiency of their processes. Business leaders install BPI to reach specific goals:
- Reduce the amount of time needed to complete and review assignments.
- Identify and eliminate wasted efforts.
- Reduce the impact of human error.
- Improve the quality of a completed project.
- Avoid task friction - being overwhelmed by too many assignments, struggling to fight distractions at the workplace.
What business process improvement is:
- Meeting growing customer expectations and set the business apart from competitors.
- Sharing skills and knowledge between the company's teams.
- Eliminating the waste of resources - money, time, talent, material, and opportunities.
What business process improvement is not:
- A strategy that’s only relevant to large-scale businesses.
Small and medium organizations, too, profit from BPI. With limited resources, it's important to make the most out of them. And that's exactly what BPI is for.
- Building new processes from scratch.
It’s common to confuse improvement and rebuilding. The goal of BPI is to make existing workflows faster and more efficient. It's not about creating new ones for creation's sake.
- A strategy that can be replaced by having a skilled team.
Some managers tend to blame teams' aptitude. If they replaced the existing team with a 'better' one, things will improve. Shifting the responsibility on the team sets it up for failure and is often incorrect. Without good processes, even the best professionals will fail.
5 Key Benefits of Process Improvement
For 90% of companies, using outdated tools and processes is the thing holding them back. Process improvement helps spot slow or redundant practices, optimize or remove them.
Here are the key benefits of putting effort into business process improvement:
Increasing employee engagement and automation are the core objectives of process improvement. These changes help achieve impressive results in promoting productivity within the team.
- Collaboration within the team improves efficiency by 25%.
- Automating repetitive tasks can save companies up to 520 hours per year.
- Introducing technology to workflows improves the productivity of 92% of employees.
2. Employee satisfaction
Improving business processes reduces tension within the team and increases employee retention. Studies show that shared leadership and opportunities to express grievances make businesses appear growth-oriented and reliable.
After implementing a process improvement strategy, business owners will reduce workplace stress for the team and avoid high employee turnover.
3. Customer satisfaction
Per Microsoft's survey, prospects determine a company's worth by its processes and technology. For 90%, learning that the business they are about to work with relies on outdated tools is a deal-breaker.
Business owners often think that processes are not visible to customers. Yet outdated workflows are often the reason for missing out on opportunities.
Achieving workplace agility is one of the key factors of a company’s success. According to MIT, flexible workplaces generate 30% more revenue and have 37% faster growth rates than businesses that rely on clunky, outdated processes.
5. Reduced risk
Process improvement aims to reduce the impact of human error, predict risks, and provide team leaders with contingency plans for all types of threats. Here are a few process improvement strategies that improve corporate security:
- Documenting risks and developing control mechanisms for potential threats.
- Introducing technologies that eliminate or reduce the impact of security threats.
- Automating processes that could compromise security to reduce the impact of human error.
DMAIC: Efficient Process Improvement Strategy
First things first. You need to identify areas that are holding the company back.
One of the most widely used problem-solving strategies is DMAIC (short for “Define”, “Measure”, “Analyze”, “Improve”, and “Control”).
Its main benefit is stopping business owners from missing out on important steps of business process improvement.
Let’s take a closer look at the components of DMAIC:
- Define - identify the main goals of business improvement. A recommended strategy is to set a few small objectives, as well as 2-3 far-fetched, ambitious goals.
- Measure - determine a set of metrics that will serve as a baseline for tracking improvement. Reliability, alignment, cost, cycle time, efficiency, and the list goes on. Depending on the goals for process improvement, the list may vary. Choose the ones that fit your organization the most.
- Analyze - determine what prevents existing business processes from meeting goals. Business developers should analyze and document the disparities between perfect and existing workflows.
- Improve - apply new strategies and tools to improve the efficiency of existing processes.
- Control - ensure that the team adheres to new processes in the future. While doing so, analyze how effective the changes are. This step determines whether a manager can build a scalable, designed-to-last change.
Now, you are familiar with the core principles of DMAIC. It’s time to design a process improvement plan reflecting its core principles.
1. Map out existing processes
Team leaders need to have a big-picture view of all workflows within the organization. Mapping is the way of structuring all existing processes.
- Establish a set of criteria to describe processes. It’s a good idea to outline key actors, actions, output, the impact on the customer, and risks for each workflow.
- Don’t overcomplicate process maps. Adding too many sub-processes to each workflow makes the framework hard to grasp. While listing sub-processes is a good idea, be sure to limit the number to 2-3 per workflow.
- Choose the most comfortable way to map processes. Visualizing data in a flowchart, a data flow diagram, a value stream, and others. Find the one you are most experienced in and the easiest for the team to understand.
2. Focus on improving customer experience
According to McKinsey, customer satisfaction is an important factor in teams’ operational efficiency. That’s why many companies reshape business processes around customer journeys.
Here’s how you can connect improving customer satisfaction and the company’s overall operational efficiency:
Step #1. Determine which stages of customer journeys are crucial to customers in your field. In a survey of US banking service customers, for example, the ease of filling in the application, the range of products and services, and the accessibility of product-related content were the key determinants of customer satisfaction.
Step #2. Think of ways technology can help your business handle these processes efficiently. The results of these changes are impressive - according to McKinsey, improving customer satisfaction helps companies generate up to $1 billion in yearly revenue.
3. Create a hierarchy of processes
Team leaders need to catalog and rank all workflows within the company. Managers need a clear idea of the processes to scale, those that can stay local, and the ones they can shut down for good.
Business analytics suggest prioritizing processes by grouping them into three categories:
- Signature processes - processes that are distinct for each company and need to be globalized to ensure consistent growth. These workflows are expensive to develop and scale. It’s better to not have more than two signature processes. Product development and customer relationship managers are typical examples of signature workflows.
- Enabling processes are those that support the execution of signature workflows. Since they are vital to the company, these should be scaled and globalized as well. Performance and talent management, as well as budget planning, are examples of enabling processes.
- “Hygiene” processes are maintenance workflows that ensure security and legal compliance within the organization. To reduce costs, team leaders keep these processes local and don’t spend too much time optimizing. Optimize only if these are bottlenecks that get in the way of higher-level processes.
4. Be iterative
Iteration has become a powerful strategy in business process improvement. Reviewing and improving implemented strategies allows companies to track growth and progress.
Here’s what “being iterative” means for process improvement:
- Appoint people responsible for reviewing processes.
- Create mechanisms for sharing feedback with the team - polls, surveys, and online sessions.
- Use tools that allow the team to analyze a project’s progress in hindsight - Trello, Asana, Wrike, and others.
- Create a schedule for iteration sessions.
4 Business Process Improvement Examples and Idea
Here are examples of process improvements you can adopt in 2022 to make sure the business is at its peak efficiency.
1. Digitizing paper-based documentation
Team leaders often have a lot of paper-based documents to print, distribute, and store. Keeping your document library paper-based limits its accessibility. It also increases the need for storage space, and security risks (there’s no way to back up a file).
That’s why document digitization is a powerful way to improve the team’s productivity. Here’s how you can get started:
- Create a document inventory and group all files it contains by type.
- Establish a plan for document scanning, prioritizing confidential and relevant data over other types of paperwork.
- Choose a tool for storing scans - make sure it’s a reliable and scalable platform.
- Create an access policy for electronic records to protect the file library from third-party security attacks.
- Get rid of the documents you no longer need.
2. Omnichannel access to services
Make sure that customers can reach you using platforms they are comfortable with. This will make the lives of your marketing and sales reps a lot easier.
Here are the tips for expanding your service across all popular channels:
- Optimize your product for mobile.
- Improve the speed with which the team replies to social media messages.
- Leverage the full power of email when connecting with prospects.
- Optimize your product to work with AI assistants.
3. Automate and simplify decision-making
There’s a lot of debate on the automatization of decision-making processes. After all, some choices can irreversibly change the company’s development trajectory.
Outsourcing decision-making to AI might be too much too soon. Still, if you use big data analysis to drive your decisions, you will reduce a lot of guesswork from the process.
Consider implementing the following strategies to simplify decision-making:
- Use a digital asset management solution to get one-click access to all the data that’s relevant to the discussion.
- Deploy AI and ML tools to process data and transform it into actionable insights.
- Keep decision-making processes transparent by documenting them and opening access to stakeholder meeting notes to the entire team.
4. Transforming onboarding
Last but not least. There’s room for optimization and improvement across each stage of talent management. Here are the key ways to reimagine onboarding:
- Pre-hiring: building an employer brand and educating applicants on the company’s values and corporate culture.
- Hiring: making sure that job interviews assess job candidates effectively, improving the speed of shortlisting applicants.
- Onboarding: creating clear employee guidelines, preparing the team to welcome a new hire, ensuring that a new teammate has an assigned mentor and feels engaged at the workplace from day one.
Business process improvement is a steep road for business owners. But it is the path worth walking on as it leads to higher revenue, reduced workplace stress, and the discovery of new opportunities.
Missing out on process improvement makes meeting constantly-growing customer expectations difficult. Assessment and iteration are the key ingredients of a successful process improvement strategy. As long as you do due diligence and unite the team to work towards the common goals, you’ll see positive changes brought by process improvement in no time!
Start your business process improvement strategy by implementing Pics.io DAM into your workflow. We have a free 7-day trial so you could see whether Pics.io is the right fit for your business.