Many businesses out there are up against tough competition. Not only that, but they’re often operating on tight margins making it an on-going priority to contain costs. It can be a balancing act to get it right, and the focus can naturally fall back to selling more and selling faster to keep the business growing at a fast pace. For more tips on growing your sales faster, see our article How to Grow Sales, Faster – 5 Secrets Shared.With all this in mind, why should you spend time planning and implementing Business Process Improvements (BPI)? The short answer is that it can support your company's long-term growth and boost your profitability.
Business Process Improvement (BPI) – told by the blind men about an elephant
The tale of “The Blind Men and the Elephant” originated in India, was translated into English in the 19th century by writer John Godfrey Saxe and is still incredibly relevant today. In the story, six blind men who have never before encountered an elephant attempt to describe it to one another. One of the blind men touches the elephant’s trunk and describes it as being like a snake. Another wraps his arms around the elephant’s leg and says it’s similar to a tree. Another grabs hold of its tail and declares the elephant must be like a rope.
This story is all about point of view and realising that many of us think we know and understand a problem, even though we only have a limited view of it. And from a perspective of business process improvement, this story relates to anyone who’s responsible for a business process. When an individual “touches” their part of a business process, it’s the part they know and understand, but of which they also may not have a holistic view.
By implementing process improvements, it can give everyone the opportunity to see all of the interlinking processes, how they affect each other and how they can be improved as part of a more unified solution. This can not only motivate people to get in and help fix the broken or inefficient processes, but also starts to breed a behaviour of ensuring things are running efficiently on an ongoing basis. And in the end, that means a huge potential for reducing costs, freeing up more time and having the best processes in place to empower your business to sell more and sell faster.
"By implementing process improvements, it can give everyone the opportunity to see all of the interlinking processes, how they affect each other and how they can be improved as part of a more unified solution."
So what do I need to get started? No elephants required, right?
A lot of businesses think they need to have all their processes set up, documented and working well before they even consider business process improvements. But in reality, one of the key outputs of business process improvement is identifying the low hanging fruit – missing, time-consuming or undocumented processes.
What you do need to get started though is a plan. The Six Sigma DMAIC (Define, Measure, Analyse, Improve, Control) methodology provides a strong foundation for process improvements. It’s well documented and there are those out there who make a living on helping businesses implement and manage this exact methodology. To help you get an idea if it’s a something that could work for you, we’ll cover the basics as follows.
This is where you decide and document what’s important - not only to your business, but also to your end customer. This is a vital ingredient to seeing that the changes made will help you continue to improve productivity and grow the business. Will your customers see any benefit from the improvements you’re making? Will they see direct improvements such as faster service and delivery times or lowered product costs? Or perhaps it’s more indirect benefits they’ll see, such as gaining a better overall customer experience through freeing up your employee’s time to concentrate further on servicing those customers. Be sure to know who your customers are, what their existing issues are and what’s likely to be most important to them as a benefit of the changes you’ll make.
This is also the stage in which you get clear on who the internal stakeholders are, the resources that will be involved and your actual goals. We recommend having SMART (Specific, Measurable, Achievable, Relevant and Time-Bound) goals. This makes it easy to see how the improvements have performed once implemented.
What you’ll be doing in this step is collecting your existing business data and objectively identifying the baselines for your process improvement. It’s a good idea to track things like the number of hours staff are spending per day, week or month today to do specific tasks, and how long each step takes. For example, how long does it take from the time your customer submits and order to seeing delivery of that order. Having a system that can give you comprehensive reporting from across the business can save you a lot of time here. You should also start creating a high-level process flow in this stage, as your resources and stakeholders will contribute to and expand on this later.
This part involves figuring out where your current processes are breaking, being repeated or creating bottlenecks and determining the root causes. Work with the individuals responsible for each part of the process to not only give you feedback on the issues they see with the daily processes they’re performing or managing but, just as importantly, the issues they see with other processes they don’t have control over.
Clarify which steps are adding value and which aren’t. Build out your process maps and look at any defects (points at which particular processes might result in different outcomes when they’re performed multiple times). Reducing these defects are a core component of the Six Sigma DMAIC methodology, so it’s important to consider them at this stage.
This is the really fun part of it all, where you can use the input from your employees and stakeholders together with the data that you’ve gathered to start designing creative solutions for the problems you’ve uncovered. You might want to brainstorm with employees or test out a new way of managing a process to see how well it could work. A huge benefit of getting buy-in from employees in this phase is that they’ll naturally become invested in seeing their ideas and suggestions come to life. And this, in turn, this helps breed and promote the behaviour of continual improvement throughout your business.
When deciding on the right solution, look at all the options and focus on the simplest and easiest when it comes to day-to-day business management. Then, start putting a plan together to implement these improvements. Who’s going to be responsible for making each improvement happen and in what time frame? Make sure this aligns back to the SMART goals you set out in the define phase. And if technology is going to play a role in streamlining and automating your business processes, look to invite your software vendor or implementation partner into discussions early. The likelihood is they have provided technology solutions for similar businesses.
"Use the input from your employees and stakeholders together with the data that you’ve gathered to start designing creative solutions for the problems you’ve uncovered."
Arguably the most important step here, this is where all your hard work can be cemented. Look at how your improvements have performed against your SMART goals and how you’re going to keep measuring things on an ongoing basis. If you’re already taking advantage of automation through an ERP solution, you could set up reports to be sent automatically to you or other stakeholders regularly, or even just as defects occur.
Make sure each of your newly implemented or streamlined processes are sustainable and define who’s responsible for making sure each of those business processes meets the standards set out. And, of course, don’t forget to celebrate the achievements, the successes and your performance against what you originally set out to do.
Boost efficiency and productivity
Business Process Improvement is more than just a catch phrase for managing your processes better. It can instigate a change in mindset for your employees and colleagues. Breeding a culture of being invested and involved in the business becomes an output of process improvement that further boosts business efficiency and productivity.
You may also be surprised by how much time can be saved, operating costs lowered and increased outputs gained. This can really empower your business to create a better customer experience, sell more, sell faster and sell more efficiently. And that’s when you can see even stronger business growth.
So have a think about that elephant, how your different employees and colleagues might describe it by touch, and how a better view of each other’s processes could start to get your business operating more efficiently.
More ways to improve profitability
Technology is being used by businesses all around the globe to improve profitability. Not only that, the right business management systems are also helping companies do more without increasing headcount. Implementing best-practice processes that have been tried and tested by literally thousands of organisations, from SMEs all the way through to enterprises, is now within reach of all companies.
ERP (Enterprise Resource Planning) systems are a type of business management software that bring all aspects of your operations together including finance, inventory management, CRM, sales and marketing, eCommerce integration and more.
If you’d like to find out how a cloud ERP can deliver leading processes, real-time visibility across the business, automated reporting and intelligent dashboards and KPIs that all help to streamline your business, organise a free product tour or have a chat with us on 1800 528 783.
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