What separates great businesses from good ones? It’s the ongoing pursuit of excellence throughout an organization
The most successful business leaders know that no matter how smoothly their company might operate, there’s always room for improvement. And there’s always something more that can be done to achieve higher levels of performance.
Moreover, in today’s fast-paced and ever-changing business climate, continuous improvement and innovation are imperative. They can mean the difference between a company accelerating and a company failing. This is where the concept of business process improvement (BPI) comes in. Through improvement methodologies and tools, BPI will allow you to optimize your organization on every level with a focus on improving or creating additional customer value.
Mastering it is the most significant step toward achieving operational excellence. In this guide, we’ll discuss how to leverage process improvement to not only improve your business but also create a sustainable competitive advantage.
What Is Process Improvement?
Process improvement is a proactive approach to improving how a business operates. It includes identifying, analyzing, and optimizing existing business processes and workflows – both internal and external.
The ultimate goal is to create an efficient and effective organization that provides quality in all aspects of its execution. When looking at process improvement from a strategic perspective, increasing customer value through quality includes more than changes to just workflows and processes. It also refers to changes in company culture, the use of technology to achieve improvement objectives, and the creation of effective employee performance plans – to bring it all together.
Some typical examples of process improvement initiatives include:
- automating repetitive tasks;
- cutting down on excessive and unsecured email communication;
- making changes in resource allocation;
- adding approval steps to ensure the quality of services or products;
- conducting staff training;
- creating better approaches to managing complex workflows;
However, as your business evolves, so do your goals, strategy, and processes. Therefore, business process improvement is not a one-time thing. It’s a continuous process that will become an integral part of your business strategy and culture.
Through continuous process improvement, managers can:
- improve a company’s existing operations;
- boost productivity;
- reduce waste;
- decrease human error;
- save costs;
- maximize profits;
- enhance innovation;
- improve communication between teams and peers;
- create a lasting competitive advantage;
- and much more.
The list of benefits that business process improvement efforts can provide extends well beyond the few we’ve already mentioned. We’ll discuss the most significant ones later in the article. For now, we want to emphasize the importance of implementing a continual improvement process across the organization.
What’s also important to note is that there are numerous process improvement methodologies that, while sharing the same goal, use different paths to achieve better outcomes.
How Process Improvement Relates to Business Process Management
There are some who say that business process improvement (BPI) is synonymous with business process management (BPM). Truth be told, they aren’t that far from one another as process improvement plays a significant role in BPM.
Business process management is, however, a broader concept. It includes process improvement initiatives (identification, analysis, and optimization), change management, employee performance management, and technology deployment. BPM offers a holistic view of improvement recognizing that coordinating teams, making changes to processes and workflows, leveraging technology, and driving a culture of excellence are critical components to achieving lasting business improvement. In other words, process improvement efforts are a component or subset of business process management, leading to a better working organization where workflows and processes are streamlined and more efficient.
Continuous Process Improvement vs. Business Process Reengineering
Business process improvement is sometimes confused with process reengineering. And while these two share some similarities, they are not the same.
BPI refers to modifying processes while keeping their essence. It aims to improve existing processes instead of completely replacing them with new ones. On the other hand, business process reengineering (BPR), applies to broken processes that require rapid upheaval.
BPR seeks to fully redesign existing processes, whereas process improvement focuses on modifying and augmenting them.
Advantages of Business Process Improvement
The ultimate and long-term goal of business process management is the creation of customer value that drives a sustainable competitive advantage. It’s important to note that success with BPM isn’t achievable without the BPI component of improving and optimizing processes within the organization. Ultimately, the advantage of business process improvement is that it creates the pathway for achieving BPM’s primary objective. On a micro level, it’s the accumulation of other BPI advantages that ensures the achievement of better business performance overall. The exact number and nature of those advantages depend on the improvement methodologies used and your business goals. Typically, benefits include the following:
- More effective and efficient business operations.
When BPI becomes a “way of doing business” in your organization, all processes and workflows are fair game for changes and improvements. This, ultimately, makes the organization more efficient and effective. Using continuous improvement creates better execution by reducing waste and eliminating disruptions. And by adding technology to the mix, efforts can be streamlined through automation – especially for tasks that are routine or repetitive.
- Boost in productivity.
The efficiency of working in an organization depends on the productivity of team members. There are various ways in which managers can try to boost it through improved resource allocation, better skills alignment and training, and deployment of advanced tools and/or technology. BPM software, for example, can easily address workload balancing and allocation while also automating entire workflows and processes.
- Analyzing productivity can also be greatly enhanced by technology’s ability to provide real-time visibility and transparency across an entire team or department. Changes and course corrections can literally happen on the fly. The business impact is valuable change and improvements in days rather than months.
- Improved employee satisfaction.
As previously stated, business process management reflects the broader impact of BPI on an organization such as how it affects culture. By fully embracing process improvement across a team, a department or an organization, employees will start to see value in how even the smallest aspects of their jobs can make a difference in their company’s performance. Taking it one step further, automating workflows and processes as part of any BPI initiative will allow many employees to get out of working on the more mundane and repetitive tasks that take up too much time. This lets them focus on higher-value activities. And, ultimately, it creates more interesting roles for many and drives greater employee engagement and satisfaction.
- Enhanced innovation.
By including teams in process improvement, managers can encourage their employees to develop and exchange ideas. That alone spurs innovation, but once that collaboration is combined with new process and workflow improvement methodologies, it can take an entire company and its processes to the next level.
- Higher quality services/products.
More efficient and effective business processes lead to improved products, be they services or hard goods. That will lead to enhanced customer satisfaction and a better customer experience, resulting in higher brand value and improved financial performance for the company.
Process Improvement Methodologies
There’s certainly more than one way for business process improvement to occur. And there are numerous methodologies you can use. While each technique may lead to the same results, the means by which those results are delivered will vary. For example, some process improvement techniques focus on changing corporate culture. Others that leverage the “lean” methodology focus on eliminating waste. These frameworks can be used separately or together, depending on your business needs and strategy.
We’ve compiled some of the most popular business process improvement methodologies below to expand the discussion.
The Kaizen process improvement technique heavily focuses on lean and agile practices. It emphasizes improving productivity, efficiency, and quality of existing processes.
The goal here is to achieve that improvement by making changes to company culture and daily work, fostering an environment that doesn’t punish mistakes or errors. Instead, the Kaizen methodology works to teach lessons and prevent these mistakes from occurring again.
The Kaizen methodology typically includes the following:
- Setting business process improvement project goals;
- Reviewing current company processes;
- Implementing changes;
- Reviewing the improvements and making necessary changes;
- Documenting the process and providing reports.
The PDCA methodology stands for plan, do, check, and act. Some don’t treat it as a separate process improvement methodology but as part of several techniques, such as Kaizen.
The PDCA cycle includes four steps:
- Plan. The company decides which processes require improvements.
- Do. Management implements necessary changes.
- Check. New procedures are compared with the old to determine their efficacy.
- Act. The improvements/changes are assessed, and depending on the results, the changes are implemented company-wide or revisited for further improvement.
Six Sigma Methodology
Six Sigma is one of the most popular process improvement methodologies. It’s a very data-driven technique where all business processes are defined, measured, analyzed, improved, and controlled (DMAIC method).
The goal of Six Sigma is to identify and eliminate errors and minimize variability. It does that by including employees in improvement processes. Workers are pulled up through the ranks, which are categorized according to karate belts, from green to black.
The 5S model is part of Kaizen and lean process improvement techniques. It’s typically used by organizations looking for rapid improvements, as it focuses on enhancing the productivity and efficiency of employees.
The goal is to help bring more consistency to the workplace to standardize and streamline workflows. As for the name, 5S stands for sort, straighten, shine, standardize, and sustain, which are the steps involved in this framework.
The total quality management (TQM) methodology aims to cultivate long-term success by enhancing customer satisfaction. Like Kaizen, the total quality management technique achieves this goal by encouraging the entire company to participate in the improvement process.
It does that by making certain changes to the corporate culture, focusing on providing quality services and products by eliminating errors. Again, the goal here is not to punish these mistakes but to learn from them and prevent them from happening.
Kanban is the tool used for process workflow visualization. It helps business units, employees, and management to understand what they want to achieve through the improvement process. Its goal is to ensure everyone in the company is on the same page regarding the final outcome.
Theory of Constraints
The theory of constraints (TOC) model focuses on eliminating bottlenecks (or constraints) that stand in the way of achieving your business goals. It’s a very process-oriented approach, where the improvement process is repeated until all bottlenecks are eliminated, and all objectives are achieved. Which, according to this theory, never happens.
Indeed, TOC is the perfect example of a continuous process improvement methodology. That’s because this theory assumes that there’s always at least one constraint to overcome, meaning there’s always room for improvement in how the entire organization operates.
Lean manufacturing is the mother of all lean methodologies. Its focus is eliminating waste, leading to cutting costs and improving efficiency. It does that by evaluating processes involved in the value stream.
If one or more aren’t up to standards, management focuses on improving them, which should ultimately result in improvements applied to the entire company’s remaining processes.
Value Stream Mapping
Value stream mapping helps businesses visualize process workflows. This process model aims to represent how a customer views the company’s processes, which helps evaluate the quality of service, product, and workflows.
The value stream mapping model is very similar to lean methodologies, as it focuses on eliminating disruptions, waste, errors, and redundancies.
Process mapping is another workflow and process visualization approach. In this case, it shows and helps evaluate data about the company’s workflows, providing managers and teams with a clear visualization of a workflow, from start to finish.
It does that in a diagram format, and the model itself is often referred to as a process chart, functional flowchart, or process model.
How to Optimize Your Business Through Continuous Improvement
When starting a business improvement project in your organization, you will need to first analyze current workflows and processes. See how they can be improved and discuss the possible changes with your team. Oftentimes, the identification of areas to improve are very apparent. Don’t overthink it, but do find an area of focus or priority.
Once you’ve honed in on the priority, don’t let “analysis, paralysis” or the fear of the unknown hold you back. It’s likely that others in your industry or “like businesses” have faced similar issues. Do some internal research and get with others in your organization who might have ideas on how to get started. Just remember that it’s not important to have a plan for the entire organization as long as there is a broader vision for how improvements will affect other teams, departments, and possibly the enterprise as a whole.
Beyond internal networks and resources, look to external resources such as industry associations, alumni groups, industry leaders, LinkedIn groups, events, and supplier/vendor websites. Many will welcome the opportunity to discuss your challenges and how they might be addressed. Also, “how to” guides are readily available as are thought leadership papers and on-demand or live events.
The exact steps of your BPI approach will depend on the methodology you choose. Identify one from the list above or go beyond and find other methods that might apply best to your current business situation. From a technology perspective, just know that there have been significant advances in the tools available to help with your business process and workflow initiatives. But not all are created equal. Due diligence in this area will also prove to be fruitful.
How HighGear Can Help
From what we’ve discussed, business process improvement might seem daunting. And to be fair, it will take some work and coordination to get started. Those of you who have previously embarked on BPI or BPM, will know what we are talking about. It is, however, a must for any business that wants to truly thrive in the 21st century.
Luckily, you don’t need to do everything manually. And no single company needs to “boil the ocean” by thinking about every process, workflow, or element that needs improvement within the business all at the same time. As mentioned, the best place to start is with one of the “burning issues” in the organization that you think can be the launch pad and an example of how real improvement can take shape.
As you embark on real process improvement, automation will likely be a critical aspect of your success. This will allow you to manage and optimize your tasks, improving your overall company efficiency, efficacy, and productivity beyond the BPI or BPM activity in and of itself.
This is where HighGear comes in. Using our dedicated BPMS platform, you will be able to automate, manage, and improve existing tasks and work at scale across your entire company. Our platform is 100% no-code, utilizes process visualization to help create and manage workflows, helps create reports, allows your teams to communicate easier, and much more.
In today’s fast-paced business climate, organizations need to keep improving to maintain their competitive edge. That need for continuous process improvement has become imperative. The road toward achieving its goals, however, can be bumpy.
There’s no other way to say it – business process improvement is a comprehensive concept requiring much effort. However, with the right tools and effective process automation, you can optimize your business, ensuring all its processes perform as efficiently as possible.
Take advantage of HighGear’s workflow no-code platform today, and unleash the full potential of your business.
Schedule a consultation today and learn more about how we can help.