Business has many meanings and paradigms, but the most important as per my experience, is the business processes.
If you want to dissect a business, understand what you want to do with it (what I call the external look) or within it (is the internal focus), then you must look at the business process.
The best example lies within the ERP functioning and several implementations I have witnessed. If I can draw out the actual business process -- not a superfluous understanding of steps -> activities -> tasks -> business process, but a real point by point flow up to the 6th level of the process steps -- then I can solve any problem or any question.
Problem: I want to eliminate waste (which is lean principle), or improve the accuracy/ error rate/ or reduce variation (which is six sigma), or want to transform a process from an as-is state to to-be state- for better automation/ standardization/ etc (which is BPI or BPM..). I can easily achive that by a deeper understanding of the business process.
Question: My organization has a goal to grow three-fold in five years. How do I establish my department or processes to align to that goal? Again this is future looking and identifying the gaps (which is doing SWOT or any such analysis as PERT, etc). Here too I can achieve this with help of business process understanding.
In essence, we need to know our "business process." But how do we uncover this behemoth?
A classic theory says we divide and rule or breakdown and understand better. So what you can do is get a bunch of consultants (basically doctors) to diagnose the situation (which can be a problem or a question) and ask them for advice. The consultants will decipher the process into various ways and questions can be answered for the below:
- Who does what and how
- Why is some activity, step, or task done, and what is the sequence of those steps
- How is a process coming together (what are the parts of the process- automation, system, ERP, PLM, external party/ vendors, internal staff, and so on)
- Where are the gaps (now this will be easily evident if the above is well done). Gaps: what I mean by a gap is primarily "the missing link" from the as-is i.e. current state of the business process to the to-be (which is where you want to be, i.e. the question or the problem to be solved).
Another example: I have a department which manages all the payrolls for individual employees. Each month the team spends around three days to reconcile all the data of leaves, time records, claims put by employees and other aspects of taxation etc. They do these tasks sequentially in order to avoid any mishaps and then carefully draft the end salary to the employee in a neat envelope and send it via a post.
Now if I draw a neat model of the business process - step by step - function by function, then surely I will find out all the gaps, ways to automate and where to standardize and improve. As well as reach to a to-be some state. Now this some state is critical, if I have a goal in mind then surely I can do this exercise (either myself or with consultants) and target for improvement.
So we come to something which is more abstract which is this "to-be some state". The world has become more complex than ever and abstraction is something that everyone has to deal with in daily life. For example even if you dont have any hands-on experience on setting up a system on Cloud, you still speak of Cloud/ SaaS and technology aspects which you havent even witnessed. And this is perfectly normal in today's world. Thus it is normal to not know where you want to go and thus not know what is the "to-be some state" of your process.
Of course if I look at a business process maturity aspect, then it goes from being rudimentary/orthodox state where all activities are done by man/hand, to a more automated state, to a standardized state, to a fully grown mature state with measuring and continuous improvement of the process with KPI's and metrics. I can think of a further state of outsourcing the process, getting benefits of productivity/offshoring and getting the process on a cloud. Who knows, one day we may have business process on a cloud not just systems or technology.
Now, only if I had a magic wand to find out what I want to do with my business process, then I could definitely do something about it. But it's not always possible to go to the nth degree and find out what I just said to breakdown the process. I am on a journey to unleash more about BPI, BPM and what it takes to make you happy about your business process. Stay tuned for future musings on this important topic and I look forward to hearing your thoughts.
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