Process management improves work quality and efficiency

Definition: What is business process management?

Process management is the oversight and organization of activities, software, time, tools, data, etc. needed to get work done and ultimately improve the business. We’ll dive further into it in a moment, but first let’s understand what is meant by a “process.”

What is a process?

A process is a series of steps that a person or team completes in order to achieve a goal. Examples of a business process include the steps:

• A business goes through as it delivers a service to a customer
• A manufacturing plant goes through as it creates a product
• An HR team goes through to hire a new employee
• A software development team uses to test its new features

In each of these examples, an organization or team is trying to achieve a specific outcome. Every time one of these outcomes is needed, the organization starts the same way, follows a defined route and ends at the desired goal. Everything that happens between the start and end goal are part of the process.

The process answers the question of “Who does what by when and needs what resources to do it?”

What is Business Process Management (BPM)?

Business process management (BPM), in that case, encompasses the work required to control all of the processes in an organization. Five high-level tasks go into BMP:

• Process Design: determining what steps will be involved in the process
• Modeling: documenting the process in the form of a diagram
• Execution: using the process
• Monitoring: watching the execution of the process to see where there are gaps and bottlenecks in the work. Finding opportunities for improvement and automation.
• Optimization: making improvements to the process

Two types of process management

Depending on how far out the time horizon is and at what level steps are taken, a distinction is made between operational and strategic process management.

Operational process management (OPM)

Operational process management scrutinizes the company’s daily tasks. The focus is on identifying potential for improvement in day-to-day workflows and initiating specific optimizations in order to improve efficiency. This involves a short-term time horizon of a maximum of one year.

An example of operational process management

Operational process management might look into the way in which an agent provides service to a customer. It would investigate questions like:

• How does the interaction begin?
• What tools does the agent use?
• What steps does the agent go through to help?
• How is the interaction concluded?

As these questions are answered, an ordered sequence of steps can be defined. Additionally, the work can be examined to see if there are steps missing, that take too long, that cost too much money or that can better support the customer.

Without taking these steps, the service would not be consistently handled in terms of quality, procedures and information flow. Frustrated customers would likely result, leading to higher churn rates and less positive brand sentiment.

However, by leveraging operational process management, customers receive specific information on certain issues straight away and experience a clear process. Automations – such as standard notifications and regulated updates – would further streamline the process and improve customer satisfaction.

Strategic process management (SPM)

Strategic process management is an aspect of BPM that takes a longer-term perspective. It determines whether the existing processes are in line with the corporate vision. It determines if processes need to be optimized, removed or created in order to help the business reach it’s strategic objectives.

An example of strategic process management

Strategic process management might ask a question like, “Why have sales have dropped despite the release of new products?” While investigating an answer, it becomes clear that sufficient training wasn’t being provided to the sales team to help them be prepared to speak about the newer products.

In this case, those responsible for strategic process management might design and model a new process that begins with the product entering its testing phase, steps through the way in which communication about the product is delivered to the sales team, and ends with training completion.

How is Process Management Different?

Process management vs. workflow management

Two terms that are often used interchangeably are process and workflow. In fact, there are key differences between them when examining the work to be done by an organization.

The difference between processes and workflows is the scope of the work being examined.

The scope of processes is broader, focusing on how to achieve a business outcome. It may, in fact, be so broad that it contains other processes or workflows within it. The scope of workflows is narrowed down to completing a specific business activity: A workflow would be along the lines of how to complete a certain form or how to get approval on a new product design.

Process management vs. process optimization

Process optimization is one of the high-level phases within BPM. In this phase, processes are reviewed, analyzed and updated in order to ensure the highest levels of efficiency, cost savings and satisfaction.

Process management vs. project management

Both of these manage work being done in a company. However, the differences are easily explained. Project management deals with one-off, temporary efforts that have a defined timeline for completion and a clear end result. On the other hand, process management deals with recurring and commonly repeated workflows that are continuously reviewed and improved.

BPM Benefits for Customers & the Organization

BPM pursues a number of objectives for the business and its customers. The most prominent of these are:

• Increased efficiency: With generally limited resources and a focus on profitability, efficiency plays a crucial role these days. By understanding and defining processes, companies can see where time, resources and money can be saved or used differently.
• Improved quality: BPM can make a significant contribution to maintaining quality standards and achieving continuous improvements. Important drivers for this are reducing errors and achieving consistently good performance.
• Better customer focus: It makes sense to optimize processes so that they better meet customer requirements and expectations. Satisfied customers are a key focus for BPM.
• Greater safety in business operations: “Safety first” is an absolute necessity. From physical safety to the prevention of IT disruptions and cyberattacks, processes ensure that employees are following all guidelines and compliance measures.
• Smoother change management: BPM helps companies adapt to changing structures and market conditions. With existing processes defined, one needs only identify what the change is going to be: From there, they can quickly assess the impact and take steps to make this as easy as possible for the business.
• More internal understanding: Process optimization can also help people understand certain processes and business results. Why does a particular process work and how? Companies can derive a lot of useful data from this.

Of course, the goals are expressed differently in each organization and industry. For example, there are usually completely different focal points in the manufacturing industry than in administration. There can also be very different goals within a single organization, whether it is better customer service or even far-reaching digital transformation.

Managing Processes: Roles and Responsibilities

Goals do not fulfill themselves – and so business process management goes hand in hand with clear roles and responsibilities. BPM responsibilities should be consistently defined in order to consistently pursue the desired goals. These are among the most common roles:

• Chief Process Officer (CPO): This is a strategic role that ensures overall business processes align with the overall company direction.
• Process Owner: This is a role that works on both strategic and operational aspects of a process. The person ensures that the specifically identified business process aligns with company goals and that it delivers on its intended value.
• Process Manager: This is primarily an operational role in which the person is overseeing the day-to-day efficiency of the process, seeking out bottlenecks, watching KPIs, examining data and looking for improvements.

Although specific roles are not always required – especially beyond the core processes – it should be clear who is responsible and who makes operational contributions.

Techniques related to process management

A range of techniques are related to BPM. There are also different approaches in this context: The top-down approach is usually used for strategic processes, and the bottom-up approach is predominant in the operational area.

Below, we briefly present some important BPM tools and approaches.

Business Process Reengineering (BPR)

Business process reengineering is a more radical approach to process management. It means nothing more than the reorganization and redesign of business processes in a company.

The following are the basic points of this method:

1. Renewing – The focus is on the skills and motivation of employees.
2. Revitalizing – The aim is to create a new process.
3. Reframing – The company replaces conventional thought patterns with new approaches and visions.
4. Restructuring – Establish the new activities and business processes.

Balanced Scorecard (BSC)

The balanced scorecard is a strategic management framework, of which strategic process management is part. It examines the health of a business on a holistic level, taking into account the:

• Process perspective
• Financial perspective
• Customer perspective
• Learning and development perspective

From the process perspective, it examines topics like quality and how quickly the process is completed. By translating performance and progress of each these areas into key metrics, employees can easily grasp the status quo and are quickly informed about the conditions for success.

Process mining – the objective, data-based approach

In the course of advanced digitalization, process mining is a method that is increasingly being used for process management: Software maps the processes in a company in detail. By analyzing a large amount of data, processes are identified and defined.

Metaphorically speaking, instead of having to laboriously draw a picture, process mining simply provides companies with a sharp photo of the situation that they can view from different angles. By uncovering weak points, the analysis allows the right conclusions to be drawn – based on an automated and objective view.

Change management – change as a trigger point

Change is omnipresent – especially in the corporate environment. Change management is therefore extremely important, because it facilitates how the change impacts the people, data, technology, structure and strategy of an organization. And, it often is the impetus for companies to take a closer look at their processes.

For instance, as automation becomes more possible in a company, processes that rely on paper forms or human research may need to be updated.

Both areas go hand in hand so that companies can adapt to changing conditions and make improvements.

Key components of business process management solutions

Most companies manage their processes with the support of business process management solutions. This software offers several features that make it easier to understand and optimize processes.

Process modeling

Process models are typically diagrams of processes in visual format. Different symbols are used to identify:

• Activities (process/workflow steps)
• Decisions
• Inputs and outputs
• Roles and responsibilities

Software solutions support process management teams in “drawing out” the steps the defined process or workflow, helping to identify opportunities for improvement, highlight chances for automation, and better communicate the process to all parties involved.

Process automation

There are sub areas of process automation, but what each has in common is that it uses technology to facilitate the work. From updating information in a field to initiating an approval workflow, automation is often used in process management systems.

Automation speeds up work and reduces errors that may come along with human interaction.

Integration with other systems

In today’s highly technical environment, it’s likely that a process will need to get information from another system or pass data to it. A key element of a process management tool is that it enables data exchange and integration the external systems.

Communication and request handling

An added benefit when considering a process management solution is the inclusion of a ticketing system. This ensures that all information and data needed to facilitate the process are captured in a ticket. This is particularly helpful if a process is designed to pass a request from one team or group on to another. Incorporating ticketing into one’s process management solution ensures that the details from step one are passed along to the person or system completing the next process step.

Conclusion: an important, continuous process

Managing business processes and designing them effectively are core tasks in the corporate world. Both strategic and operational processes are equally important and should be addressed in line with the respective objectives. If companies proceed methodically and skillfully, viewing process management as a continuous process, they can achieve far-reaching improvements and position themselves for long-term sustainability.

Dedicated software solutions can provide the right support for this. Find out how you can optimize process management in your company with OTRS.

Contact our experts