Business processes are the methods in which a business gathers, analyzes, manages, and transforms data so that it can make more informed decisions. They are the backbone of every company, large or small. It’s easy to understand why. Business processes are how a company organizes its day-to-day operations and the tasks it assigns to its employees.
A Comprehensive Guide to Understanding Business Processes
Business processes are the methods in which a business gathers, analyzes, manages, and transforms data so that it can make more informed decisions. They are the backbone of every company, large or small. It’s easy to understand why. Business processes are how a company organizes its day-to-day operations and the tasks it assigns to its employees.
A company’s processes define how it operates. From sourcing raw materials to manufacturing products to selling them, every business has its unique way of doing things. Understanding business processes is essential in any field that deals with the commercial world.
If you work in any industry— whether in business services, retail, or technology — you’ll see business processes everywhere. They’re what makes companies run daily. Read on for a guide on what business processes are, how they impact your company, and how you can implement them in your company.
What is a Business Process?
A business process is a workflow through which a company gathers, analyzes, manages, and transforms data so that it can make more informed decisions. It is the method by which a business goes about its daily operations. For example, an airline has a business process that centers around booking a flight ticket, searching for flights, and checking in passengers.
Every company is different, so the way these steps play out will be different for every company, but the process remains the same.
Business processes break down into three main categories:
Input processes: These are the systems used to collect data from the outside world and convert it into information that the company keeps on file.
Analysis processes: These are the methods the data is analyzed and then used to draw conclusions.
Output processes: These are processes the company uses to turn data into action.
How do Business Processes Work?
Business processes work by having people – employees or outside contractors – who have specific duties and roles. These people have detailed instructions on what to do and when to do it, according to the company’s schedule. For example, a financial institution might have a process involving receiving and recording customer information.
That information could then be analyzed and turned into an account number. That information is then written on a customer service representative’s computer and saved to the company’s system. From there, the information is sent to other departments like marketing, customer service, and customer relations.
How to Create Good Processes
Before diving into what makes a good business process, it’s important to note that not every process is good, and not every process needs to be good. There are a few guidelines and tips that can help you create good business processes.
Define your process clearly
Writing down a clear definition of the business process you want to implement is an essential first step in creating good processes. This will help you understand your process and why it’s crucial for your company.
Understand the roles and responsibilities
Next, you want to make sure that you understand exactly what roles and responsibilities people in your business process have. This will help you identify any potential issues in your system.
Create a workflow map
A workflow map is a visual representation of your process. You can create a chart or use an application like Google Sheets to make one. The workflow map should include all the steps your employees will take when they take them and the purpose of each step.
Types of Business Processes
There are main types of business processes:
- Customer Journey Process
A customer journey is an entire process that a customer goes through while using a product or service. It starts when the customer signs up for a new service or uses a product for the first time. This process involves the various interactions between the company and the customer before they make a purchase or change their behavior. For example, the customer signs up for a new service on their smartphone, which then sends a signal to the company’s server. The server recognizes the customer, who is then directed to the website that the customer uses most frequently.
Once the customer logs in, they are sent a personalized experience that helps them complete their task faster. After the task is completed, the customer gets an alert to show them the result. This customer journey process makes it possible for companies to provide better customer service.
- Marketing Process
The marketing process starts when a company creates a positioning statement for a product or service. This positioning statement includes details about the product, such as who it is for, what benefits it has, how it is different from competing products, etc. The positioning statement is sent to the market, which is then targeted. This process is then followed by various activities that help the company create a brand image.
The brand image is created using various marketing channels such as print media, digital media, etc. The marketing channels help the company reach out to many potential customers, who are also sent positioning statements and brand images.
- Sales Process
The sales process starts when a sales representative creates an account for a new customer. This process involves building a relationship between the two companies, which helps the sales representative understand the customer’s needs and expectations.
After creating an account, the sales representative then follows up with the customer and keeps them informed about the new products added to the company’s inventory.
The sales process helps a company increase sales across all verticals. This process is followed by a series of activities and metrics that influence the sales process, such as negotiations, closing the deal, etc.
- Procurement Process
The procurement process starts when a new product is added to the company’s inventory. The procurement process involves ordering the products, then picking them up at the warehouse and taking them to the sales representative’s desk.
The sales representative then uses the products and records the transactions in their system. This process is followed by a series of metrics and KPIs that influence the procurement process, such as order accuracy, order processing time, etc.
- Service Delivery process
The service delivery process starts when a customer calls the support desk and complains about a product. The support representative helps the customer, who then completes the transaction. The support representative then follows up with the customer and keeps them informed about the product’s performance.
The service delivery process is followed by a series of metrics and KPIs that influence the process, such as resolution time, ticket closure rate, etc.
- Accounting Process
The accounting process starts when a financial report is created and sent to the board of directors or the shareholders. The process involves creating an accounting record that reflects the transactions that have taken place with the funds. This process is followed by a series of metrics and KPIs that influence the accounting process, such as the accuracy of the data, the timeliness of the report, etc.
How to Keep Track of Your Business Processes
Once you know what types of business processes your company has, it’s time to start tracking them. There are a few ways you can do this, but the most effective one is by using a business process management (BPM) solution.
- Create an awareness campaign – The best way to keep track of your business processes is by making sure that all employees are aware of them. You can do this by creating an awareness campaign and ensuring that all employees are informed of the process.
- Develop a process map – The best way to ensure that your employees are keeping track of your company’s processes is by creating a process map.
- Integrate your BPM solution – The best way to keep track of your business processes is by integrating your business process management solution.
The Characteristics of a Good Business Processes
Many businesses don’t know what makes a good business process, so they just copy what other companies do. While that can lead to imitators, it can also lead to bad business processes.
You should think about these characteristics when developing your business processes.
- clarity – If a process is unclear, then it’s useless. It doesn’t matter if it’s easy to understand or if it’s not clear. If you have to ask someone about it, then it’s not clear enough.
- consistency – Business processes should be consistent. For example, if a business process controls the raw materials that a company uses, then those raw materials should be used in all the processes.
- maturity – Since business processes are usually the work of an organization, they should be mature. You should carefully consider what you want to implement and know what you’re doing.
- open-mindedness – Business processes should be open-minded so that they can adapt to the changes in the market.
- controllability – Business processes should be controllable. This means that if you want to change a particular aspect of a process, then you have to change a lot of other things.
- adaptability – Business processes should be adaptable. This means that they should be able to change with the trends in the market.
Incorporating Business Processes
Business processes are best managed when implemented as a technology-enabled solution. When you integrate your business process management solution with automation technology, you gain many benefits.
- Improved transparency – If your business processes are well-managed, they will be much more transparent than if they were manually managed. This means that you get to see precisely what your employees are doing, how much time they’re taking, and how much money they’re spending.
- Improved efficiency – When you implement automated business processes, the time spent performing them will decrease significantly. This means that your employees can spend more time doing what they do best and less time performing less-important tasks.
- Improved quality – If you manage your business processes well, you’re going to have a better understanding of what’s happening within your company. This means that you’re going to see if any processes are broken or if any issues need to be addressed.
Common Issues with Processes
The biggest issue with incorporating business processes is that not every process is a good fit for your company. That’s why it’s essential to assess each process you implement and make sure it’s suitable for your company.
Some other common issues with business processes include:
- Processes are often developed by managers and employees who are out of touch with the company culture. You should incorporate business processes in your company and implement them in the way that your employees do things.
- Business processes aren’t cheap. It costs money to implement them and train employees to use them. If a process is expensive to implement, it’s probably not worth it.
- You should assess each business process you implement to ensure that it’s suitable for your company. Some strategies, like marketing tactics, may be ideal for your company, but they don’t fit with the company’s culture.
- Business processes often exist in silos. This means that every department has its processes and doesn’t communicate with one another. If a process exists as a silo, you should think about whether it should exist as a whole.
Conclusion
Business processes are the backbone of any business. They help a company gather, analyze, and manage data so that it can make informed decisions. They’re also crucial in making sure that your company runs smoothly every day. However, it’s easy to lose track of them. That’s why you need to keep track of them.