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Business processes almost never change until new management notices problems like excessive processing time or overstaffing. Why do processes become inefficient? There are many reasons. Managers are so busy they no longer see the “forest for the trees,” or “that is the way we have always done it,” or “if it is not broke, leave it alone.“
As a business leader, you recognize that as your business evolves, new products and services are constantly being added or changed. These changes occur over-time, causing processes to inadvertently become overly complex and filled with work-a rounds.
You control the cost and scope of your business improvement project. We understand that one size BPI project does not fit all. Many clients start with one troublesome process like collections, or accounts payable, or credit approval, and then expand the project assignment to other areas.
Most departments operate in a vertical direction, while processes operate horizontally, passing through several departments. For example, new customer orders typically begin with marketing/sales, then move through accounting/credit, then through production/fulfillment, and finally to billing/collections. A procedure change by any department will influence the other departments, but may go unnoticed. This is why fortune 500 companies maintain full time process management teams to manage every process flow by understanding the cause and effect of all new changes.
There is no one cause for a process failure. Our experience shows that new factors will continually influence a process. New demands are placed on your managers to incorporate new products, services or systems to existing processes. Many times the new demands are based on process changes implemented by other departments. These changes can cause process bottlenecks, work-a rounds, increased time and additions to staff. A once streamlined process can become overly complex through no one’s fault.
What is process improvement? Business process improvement (BPI) is a systematic approach based on years of research, tools, training, and proven results that optimize processes to achieve results that are time efficient and cost effective.
A business process can be formal or informal. Formal processes are identified by written procedures that start with documented and well-established stages. Processes change as business products or service offerings evolve, especially with ever changing systems and advances in technology.
For example, years ago a manager who is now gone, may have written procedures to manage the credit and collections process. Over the past few years, your business added new products, services, staff, automation and perhaps new regulations.
Most often business process changes are subtle and handled with temporary work-a rounds. Over time, the original process changed significantly without being re-evaluated. Now, your process has become inefficient and costly.
It is difficult for front line managers, who have overseen the same process for years, to notice the subtle changes. Their job is to “put out fires” and keep moving their product or service responsibilities forward.
New automation systems should improve your company’s processes, not dictate or lock you into the vendor’s process. We recommend that before you purchase automation, first you perform an independent process evaluation of your existing process based on your company’s objectives. Then, evaluate if the new system’s promises will benefit or hinder your desired process.
Sometimes, even with pre-purchase system review and analysis, costly mistakes can occur. There is the story of a Fortune 500 publishing company that purchased a multi-million dollar, customized, highly complex publishing system. The vendor claimed there would be remarkable time efficiency and labor saving. Partway through the system conversion process, it became clear that the vendor’s promises were not true. The new process was not efficient and labor costs soared. Several executives were terminated because of their failure to adequately evaluate the proposed new process.
eqHR also provides Human Resources and Payroll Consulting Services in Orange, Los Angeles, Riverside, San Diego and San Francisco Counties.
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