Business Process Improvement, also called Business Process Re-Engineering is a structured approach to improving business efficiency and reduction of operating costs by removing non-value adding activities and unnecessary process steps.
To derive maximum business value from your products, people, processes and technology, a business needs to constantly evaluate the efficiency of its business processes.
Inefficient business processes can lead to staff frustration, missed deadlines, processing errors and increased operating costs.
Business Process Improvement (BPI) can help you streamline and standardise your processes, automate repetitive tasks, improve allocation of key resources and remove process steps which add to the operation costs but don’t add much business value.
Did you know that sometimes even small change can lead to dramatic results?
In 1987 American Airlines saved $70,000 in one year by eliminating just one olive from each salad served in first class. This was at no cost to the passengers who have not noticed any difference. Perhaps your business could also do with an elimination of a few olives…
Business Process Improvement Methodologies
There are many different methodologies or approaches to project improvement, however the most widely adopted are Six Sigma, Lean and CEM Method (Customer Experience Management).
SIX SIGMA Busines Process Improvement
Six Sigma methodology is most widely used in a manufacturing environment as it focuses on the elimination of defects and variances from process outcomes. Six Sigma focuses heavily on process measurement and statistical methods which require a great deal of complex calculations. It also requires implementing a special infrastructure of people within the organization (“Champions”, “Black Belts”, “Green Belts”, “Yellow Belts”, etc.) who are responsible for incremental improvement of various process steps.
LEAN Process Improvement
Lean Process improvement also originated in a manufacturing environment. It focuses on the elimination of waste and non-value adding activities. This is achieved via continuous streamlining and optimisation of processes to achieve processes that provide “perfect value” to customers. This is the most popular method of process improvement, widely adopted by many leading companies.
CEM METHOD Process Improvement
CEM Method Process Improvement goes beyond “doing things right” by also asking – “are we doing the right thing”? The CEM Method starts with the needs of the customers (Why we are doing what we are doing?) and progresses with finding the best way to accomplish the desired outcome (What is the best way of doing it?). The CEM Method is currently used by Virgin, Lloyds, Zurich, Citi, HSBS, Santander, Barclays, American Express and many other leading companies.
Eight Main Reasons for Process Improvement Failure
Although following a specific process improvement methodology is not absolutely essential, following proven steps or framework helps you achieve desired results. Here are eight most common reasons for process optimisation failures:
- documenting future (TO BE) process without first documenting and analysing the current (AS IS) process
- not following the current process to ensure that this is really how the process works
- not having a clear objective for optimisation (time? cost? quality? customer experience?)
- drawing difficult to understand, unstructured process maps
- lots of text, no diagrams or using your own drawing style rather than using industry standard notation eg. BPMN, UML, EPC
- optimising without measuring process lead times and cycle times or defining clear KPIs
- not considering what impact your BPI activity may have on other processes
- not looking at a big picture – root cause of the problem may lie outside of the process
If you need help with optimising your business processes, give us a call.
Business Process Improvement Grant
Did you know that if you have been trading for the past 5 years, you are a High Potential Start-up, a manufacturing enterprise or an eligible internationally traded services business employing more than 10 people, you can qualify for Enterprise Ireland Business Process Improvement Grant?
The Business Process Improvement Grant is used to support short to medium term company projects that are designed to develop management capability and drive company efficiencies and business process improvements. Improvement projects must address a clear business need and deliver a positive impact on your business.
Projects must also demonstrate the potential to develop the knowledge and skills of the company’s management team.
The Business Process Improvement Grant can be used to support one of the following assignments:
- Lean Plus Assignment (medium term process improvement aiming at cost reduction and productivity improvement) or
- E-Marketing Process Improvement or
- GreenPlus Assignment (to improve environmental efficiency & sustainability).
More details on Business Process Improvement Grant on the Enterprise Ireland website.