What is Business Process Efficiency?
All effective businesses are process-driven. With several processes and documentation in place, it is challenging to manage business processes effectively. A business process is put in place to streamline the work and ensure uniformity in results.
But how do we define process efficiency?
An accurate process efficiency definition can be a tricky thing to achieve. Naturally, an ideal business process would require the least amount of effort or time needed to achieve an outcome. However, in simple terms, it is the amount of work or effort needed to achieve a business goal.
For example, an employee applying for travel expenses reimbursement could wait for days or weeks before repayment is made. The drawbacks of paper forms are too many to count – illegible forms, lost or torn receipts, and delays in getting authorization. An HR and Admin workflow automation solution can come in handy here. It can simplify the processes, ensure less processing time, make tracking easier while keeping all stakeholders in the loop.
Yet, the existing processes must be analyzed, and discrepancies identified before fine-tuning a process.
Do you need Process Efficiency Analysis?
Business process analysis is a technique that helps identify processes that should be improved so that they are better aligned with the organizational goals. Every business should take a hard look at the way they are operating. It is, perhaps, the most crucial step towards automation. It is essential to identify measures that can be taken to improve efficiency.
But when is process efficiency analysis necessary?
- Bottlenecks in the process flow
- Regular delays
- Increase in customer complaints
- Complete overhaul of processes
- Advancements by competitors
- Replace obsolete processes that are hampering competitive advantage
- Ambiguity among process stakeholders about specific procedures
How Does Streamlining Processes Help Improve Business Efficiency?
Enhanced business process efficiency allows enterprises greater control over their operations and improves their productivity.
A streamlined process,
- Can remove errors during documentation
- Find the source of errors, delays and take corrective action
- Improve accountability and enhance collaboration between teams
- Remove redundant jobs
- Reduce wastages in time and effort
- Better quality control
- Involve all relevant stakeholders and increase transparency
- Make tracking easy
- Bring all processes into a single system
While most process automation systems can do this for you, selecting advanced workflow automation tools such as Cflow can simplify the complex workflow effectively. Their no-code automation platform is ideal even for non-IT businesspersons. They, too, can automate individual departments without relying
on their in-house IT or third-party service providers. Selecting a tool like this can help small to medium-scale businesses restructure their entire processes into a single system.
Process Efficiency Measuring Techniques
Business process measuring tools help in visualizing the process flow. The most commonly used measuring technique is the flow chart, in which every individual box represents a task. Each task is connected to other tasks – in such a way that it shows how each job is related to one another.BPA measuring tools show interactions between teams, customers, and employees.
For example, a finance team member would be required to interact with clients, vendors, employees, and other stakeholders depending on the task at hand.
You can make use of any of these methods to identify areas for improvement:
This workflow analysis method helps you identify the gaps in productivity and efficiency in the management process. This method lets you specify the missing chunks in the process flow.
Root Cause Analysis:
The root cause analysis gets you to the core of the problem. This method gives you information on the exact cause of the problem and potential solutions. For example, an operations system executive has to juggle multiple tasks, keep track of all the assigned work, and make sure the employees perform these tasks before the deadline. When these operations are carried out using the traditional methods, task management becomes challenging. Having an Operations workflow management platform can make the entire process easier and efficient.
A value-added analysis allows you to take a hard look at each step in the process and determine whether it adds value to the business. This step will help you remove unnecessary or redundant steps.
As the name suggests, experience examination lets you gain valuable inputs from experienced workers in your organization.
You can also gain insights into the process by observing the work floor to decipher if the process step is necessary to the entire flow.
Steps to Increase Efficiency
We understand the benefits of improving processes, but how to make a process more efficient?
The steps towards improving business efficiency should focus on analyzing business processes and devising strategies to improve.The first step in moving towards a streamlined process is evaluating your existing system. A company can come up with many processes improvement steps, but these are the most crucial ones that can determine the success of the entire endeavor.
Evaluating Existing Processes
Before you can enhance, you have to first evaluate. It is a critical step in the process that can have a great deal of effect on the outcome. Understand the ‘as-is,’ map out the entire process flow, identify the stakeholders, and put everything on a flow chart, a spreadsheet, or a Swim Lane diagram. The flowchart will let you visualize the entire process flow, the processes, and the sub-steps. It can seem time-consuming, but it is worth the effort.
when mapping out the processes, we suggest you consult the people directly using these processes, forms, or documentation every day. Since you don’t want to overlook necessary steps, you should gather as much credible data as you can. It is critical to collect as much insight into the processes to gain a complete picture of your organization’s existing functions, dependencies, and workflow chain.
Identify Process Bottlenecks and Root Causes
Identify process bottlenecks and pain points that need to be addressed by the new restructured system. It is the step where you investigate all the problems within each stage. Take a look at each critical process and identify areas of inefficiencies and improvement. The flowchart that you prepared can also tell you the exact areas that are working well for your business and the ones that need improvement.
Once you have mapped out the entire workflow, you can prioritize the bottlenecks you want to tackle. If redundancy keeps your business growth down, devise strategies to improve work processes and efficiency. If a group of your employees is not adopting some methods, the issue could be insufficient training or onboarding.
Set Process Standards
In this step, you can set the ideal process and standards that you want to be implemented in your organization.
Why do we need to set standards?
To truly identify the value of a process, we need to first understand whether that particular step in the process flow adds value to the entire chain of functions.Generally, when you do away with two different processes or ask two teams to develop a unified strategy, we face a lot of resistance from the teams with several ‘we-have-been-doing-it-this-way’ defensive answers. It could be attributed to a lack of process knowledge or training. We are accustomed to looking at the entire ecosystem in terms of organization rather than a collection of processes. That’s why it is crucial to look at each function as a singular entity and find ways to efficiently manage them so that it doesn’t become too arduous to perform. Define a framework with the best practices that can maximize efficiency and productivity.
Set Realistic KPIs
In their eagerness to develop an ideal standard, many businesses create impossible KPIs. Make sure you don’t set too idealistic standards that are not feasible or impossibly unrealistic to achieve. Remember that your business goals match your process management strategies. It’s vital that these two works together to achieve success. Your organizational system is usually broken down into achievable and measurable process goals.
These goals act as a foundation for employee objectives and KPIs. KPIs help management understands the processes that are helping businesses achieve success.
Implement Organizational Level 8 Wastes Awareness
Before you start restructuring your business process, it is essential to teach your teams to recognize eight wastes and identify opportunities that can help reduce waste. The eight organization-level wastes involve transportation, over-processing, overproduction, inventory, time management, human resource management, defects, and redundant human movements. Each of the wastes contributes to the overall efficiency of the teams and business.
Request Ideas and Suggestions from Workers
A business-level organizational restructure should always include your employees to have any chance at success. Talk to them about the changes they prefer in their processes to improve their everyday activities. A finance assistant could choose to simplify the documentation process or add a few more fields in their forms for better control. A finance and accounting automation tool can help streamline check payments or generate invoices without depending on paper records or spreadsheets.
Redesign Workflow and Process
Start the redesign process based on the inputs you’ve gathered in the initial stages. First, make sure every stakeholder understands the procedures, the standards, and the goals. Brainstorm ideas that can positively impact the process. Before devising strategies, make sure you conduct an impact analysis to determine your redesigned process’s feasibility, risk analysis, and cost analysis. It is not enough to map out the new workflows – you have to make sure these new processes are implemented fully to completely leverage the potential of the restructuring efforts.
You can think of combining traditional training methods and digital implementation concepts. Digital techniques such as process automation tools can help ensure smoother transformation. Automation helps in increasing efficiency, improving agility and scalability, streamlining process flow, and reducing errors. It also helps constantly monitor the processes and measure successes to ensure continuous improvements.