- Understanding Business Process Improvement
- Popular Process Improvement Methodologies
- Practical Tips for Implementing Process Improvements
- The Role of Automation in Process Improvement
- Continuous Improvement and Its Benefits
Q. What are some popular methodologies for process improvement?
A: Popular methodologies include Six Sigma, Total Quality Management (TQM), Lean Manufacturing, and Kaizen. Each methodology has unique principles and tools designed to optimize different aspects of business processes.
The business landscape is home to some of the most fast-paced changes, as consumer behaviors and processes morph with every slight change in tech innovations and market trends.
To keep up, businesses must adopt business process improvement strategies to review their current processes and enhance them to fit the current business climate, securing profitability and their place in the market.
Most businesses that refuse to improve soon become obsolete. Productivity, operational efficiency, and profitability slowly become myths.
Even in businesses and organizations where traditions and cultural preservation are the selling points, we’ve seen them adjust to embrace social media and technology in their operations. They apply modern strategies to attract more customers, streamline their processes to be more effective and efficient, and consequently keep earning substantial profits to keep the lights on.
So, what are the processes that need improving in your business? What methodologies and tools can help with your business process optimization across all departments?
In this article, you will learn:
- Popular process improvement methodologies
- Practical tips for implementing continuous improvements
- The role of automation in process improvement
- The benefits of continuous improvements
But before we get into all that, what is business process improvement?
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Understanding Business Process Improvement
In business, process improvement is a project management methodology that helps businesses take in and evaluate feedback about their processes to ensure continual improvement, according to Forbes.
This continual improvement usually results in workflow improvements, adapting processes, and process automation, with the aim of effectively solving current business needs, enhancing productivity, and propelling profitability.
When you think of business process improvement, you don’t have to assume complex scenarios that make the idea seem like a laborious task.
Process improvement could be:
- Adopting digital tools to reduce paperwork
- Conducting online interviews to speed up the hiring process
- Transitioning from fully onsite work to hybrid remote work
- Outsourcing your call answering in the absence of in-house receptionist or customer support agents
- Optimizing your accounting system with automated accounting software
Process improvement strategies could result from actions as simple as reducing something or as complex as overhauling the overall business structure.
There are more benefits to process improvement strategies, but we will come to those later.
Now that you understand what process and workflow improvement is, let’s look at some popular process improvement strategies.
Popular Process Improvement Methodologies
If you are searching online for process improvement techniques, you might see as many as 20 of them.
Of those, four methodologies have repeatedly proven to be very effective business process optimization methodologies, and we’ll discuss them below.
Six Sigma
Six Sigma is an improvement process that uses statistical data as indicators of business optimization. Bill Smith and Mikel Harry developed the methodology in 1986 to help reduce variations causing product defects in Motorola’s manufacturing floor.
With the Six Sigma improvement methodology, development teams can detect potential causes of a product defect at the analysis stage.
The results of the Six Sigma analysis can tell business managers if a process is optimized. Generally, an optimized process would have less than 3.4 defects per one million cycles. The fewer the defects, the better the optimization.
There are two pathways in the Six Sigma process:
The DMAIC process, used to optimize existing processes.
- Define what needs to be improved
- Measure your existing process to determine its performance
- Analyze the process to detect defects and their root causes
- Improve the process by addressing their root causes
- Control and stabilize the improved process and set protocols to correct deviations in the future
The DMADV process, used to optimize new processes.
- Define the design goals and process
- Measure and identify critical qualities of the process, product, or service.
- Analyze data to determine the best design
- Design and test the process, product, or services
- Verify and validate the design output against the design input to ensure consistency and alignment with design goals
The Six Sigma techniques will ensure consistency and quality by keeping your business processes running with minimal defects and variations.
Total Quality Management (TQM)
TQM places the customer at the center of your business process improvement strategies. It focuses on customer satisfaction as an indicator of long-term success.
During TQM implementation, feedback on possible areas of improvement is drawn from all employees or departments to assess what company culture, products, services, or processes need to be improved.
This methodology relies on data-driven decision-making, pulling data from performance and success metrics to derive results that decrease inefficiencies in processes.
Total Quality Management (TQM), as the name implies, further ensures total quality across all operations by instilling continuous improvement as a core aspect of business operations, encouraging continual reviews and improvements to help teams adapt to changing business environments.
Lean Manufacturing
Lean manufacturing, also known as lean production or just-in-time (JIT), is a process improvement strategy introduced by Toyota in the 1940s to help maximize productivity while also minimizing waste in their manufacturing processes.
Lean methodologies consider anything that customers don’t regard as valuable and are unwilling to pay for as waste.
The principles of lean manufacturing include:
- Value stream mapping: Here, businesses can use a visual tool to map their current workflow against their ideal workflow for each project, to identify the waste in their current process.
- Creating flow: After identifying the waste, managers can use the available data to redesign and optimize their workflow.
- Eliminating waste: Establish processes to integrate new designs into the current workflow to eliminate the identified wastes from the cycle.
Like TQM, lean methodologies also encourage continuous improvement, where businesses regularly repeat the improvement processes to attain perfection.
Kaizen
Kaizen is derived from the Japanese kaizen principles, which imply changing for the better. The principles are based on the idea that ongoing positive changes, even in very small portions, will eventually result in significant improvements.
These principles stay true across various aspects of life and livelihood, including businesses.
Similar to Lean Manufacturing methodologies, kaizen principles focus on removing waste and drawbacks from processes across three concepts:
- Muda: Remove components and practices that reduce resources without outputting any value.
- Muri: Address factors that overburden business resources.
- Mura: Produce in line with demands to avoid waste.
Practical Tips for Implementing Process Improvements
It is not unheard of that a company attempted to improve its products or services but ended up making them messier than they were. You’ve probably experienced this with some software updates.
To avoid such mistakes, you should consider these practical tips when implementing process and workflow improvement.
Involve Your Team
Total Quality Management (TQM) and kaizen principles perfectly capture the need for team involvement.
As a business owner or manager, you are positioned to have a comprehensive overview of everything that’s going on in your business operations.
However, it is often the employee who has been handling a particular task every day for months or years who sees and understands the more intrinsic elements of the processes they are handling. They can tell how the minute adjustments in those processes can improve company-wide operational efficiency.
Therefore, it’s important to draw insights from employees in different teams when creating your process improvement initiatives. Small positive changes from their ends could be all you need to create a system that attains peak performance.
Moreover, involving employees establishes avenues for employees to collaborate more often and find opportunities to synch operations and create more effective and streamlined processes.
Identify and Prioritize Processes
To ensure the effective use of resources and reduce wastage, you should assess the insights from the employees or different teams to determine what needs to be improved and prioritize it.
You may find the following steps helpful:
- Identify who the processes cater to: Conduct a quick rundown of each process to determine who’s at the receiving end. Does it affect the satisfaction of your loyal customers, impulse customers, or bargain hunters?
- Determine current impact on the company: What is the cost of leaving each process as-is versus adjusting it? You might find that improving some processes frees up more time and saves cost while attempting to improve others would consume more resources without commensurate benefits. It’s important to also consider how streamlining some processes could make life easier for your employees and boost their satisfaction.
- Rank and rate: With insights from the points above, select the processes that have the most impacts, then rank their priorities based on perceived impact on customer and employee satisfaction and overall impact on business productivity, efficiency, and profitability.
Don’t neglect the minor processes; direct some efforts—no matter how minimal—towards ensuring they are also optimized without disrupting workflow.
Use Process Mapping
Process mapping helps businesses define and visualize the impacts, roles, and responsibilities of every component (including the people) involved in executing a process.
It is a key element in the Measure step of Six Sigma DMAIC and the Mtream mapping step of Lean Manufacturing, both of which focus on assessing existing processes to determine their performance.
Some common types of process maps include swimlane diagrams, value stream mapping, flowcharts, workflow diagram, SIPOC, Gantt charts, and data flow diagrams.
Process mapping makes it easy to:
- Analyze workflows: Visual presentation brings clarity to the flow of value through business processes, allowing business managers to properly analyze workflows and determine what needs to be improved.
- Identify bottlenecks: Process maps expose the bottlenecks in the system and their root causes, empowering managers’ workflow improvement strategies that address the challenges from the source.
Additionally, as much as process maps help business managers identify what part of the process needs to be improved, they also highlight opportunities for different processes to merge and streamline operations.
The Role of Automation in Process Improvement
It is no secret that technology is behind the bulk of changes happening in industries today.
Much of the effects are visible in the automation of business processes, using AI-driven tools and robotic process automation (RPA) tools to:
- Handle repetitive tasks
- Augment human input
- Reduce error
- Improve speed and efficiency
- Increase productivity
- Reduce the cost of labor
Businesses use RPA tools to automate simple and tedious mundane tasks such as:
- Data entry and documentation
- Routine analyses and reports
- Moving files
- Payroll transactions
- Rule-based decision-making
- Error reconciliation
Process automation tools are also common in marketing, sales, and customer service and can be configured to meet the unique needs of various businesses, irrespective of industry.
Talk to an automation expert to explore how you can implement automation in your business operations and the most suitable tools for your business processes.
You can also check out Havard Business Review to see how some companies are redesigning their processes with AI.
Implementing Automation
Successful automation implementation requires considerable input from the humans and automation tools involved.
Therefore, you should:
Select the right tools:
Assess your processes to determine what needs to be automated. Consider the probable features necessary to meet those needs. Go for tools that are specially designed to solve specific problems. But before you do so, you should:
- Check its compatibility with existing processes.
- Measure the cost of managing the tool across multiple variables, including saved time and resources.
- Run price comparisons across tools with similar functionalities; consider the cost of subscription-based tools in the long run.
- Measure the scalability of the tool to determine if it can expand with your business or if you would have to opt for another as your business expands.
- Read customer reviews to know what other businesses are saying about the tools and their service providers. You may want to go for the provider with better customer service so you can rest assured knowing you’ll get prompt response during emergencies.
Train your employees:
Despite technological advancement, there’s no technology that works in a vacuum. There’s always some degree of human input needed to monitor and control tech tools to ensure optimum performance.
Hence, you must provide continuous training for your employees to upskill and become better users and managers of your automation tools.
Some employees may feel threatened by new technology and consequently hesitant to undergo necessary training.
It helps to empathize with them and help them understand how it’s there to make their work easier and faster. Also, explain how the training makes them better prepared to work in the modern work environment, which is continuously being streamlined by technology.
Continuous Improvement and Its Benefits
“Little drops of water eventually make a mighty ocean.”
If that saying sounds a bit exaggerated, then maybe we can narrow it down to, “little drops of water eventually fill a bucket.”
Now, that sounds more relatable—as relatable as the fact that your continuous improvements, no matter how little, will eventually lead to business success.
Continuous improvement is a mindset, not a one-off activity or a to-do list, according to Planview.
Process improvement works because businesses learn to incorporate it into their company culture and make it their identity. So, it becomes a regularly recurring operation in the business’s lifecycle, creating a continuous loop that attains various meanings and levels of success over time.
With continuous improvement, it helps to acknowledge that what stood as the most effective or seemingly perfect thing yesterday might not be relevant today. Think Blackberry smartphones.
In fact, one could argue that when it comes to business, there is no such thing as a perfect product or service. It is an idea that businesses must strive to materialize but never do, so they are steadily on their toes, finding new ways to improve and serve their customers better.
This makes continuous process improvement an essential part of your company culture.
The result?
- Your business becomes a key impact driver of change, shaping trends in your local market and industry at large.
- Reap the adaptability and agility that comes with being several steps ahead, building and maintaining a solid competitive edge.
- Time freed up by improved processes allows your employees more breathing space to engage in critical work while also enjoying improved work-life balance. This increases employee productivity and satisfaction, adding more points to your employee retention rate.
- Better products/services and shorter delivery times significantly boost customers’ experience and satisfaction, paving the way for your business to build an army of loyal customers.
- Reduced waste means reduced consumption of resources, which amounts to significant cost savings.
Lastly, a culture of continuous improvement guarantees business process optimization at all fronts, inspiring creativity and innovation among teams and team members. It secures your company’s position as an industry leader at the helm of innovation.
Monitoring and Adjusting
To foster a culture of continuous business process improvement, you have to first instill a culture of continuous monitoring.
Establish process monitoring procedures that ensure a 24/7 overview of business processes, especially top-priority operations. This will:
- Enable accountability and transparency
- Ensure consistent results
- Enhance the lifecycle of equipment, software, and other business tools
- Reduce waste
- Enhance iteration
- Fuel cross-functional team collaboration
- Help in the early detection of errors and issues
All of these create enough allowance for business owners and managers to adopt a proactive approach to business process improvements, act quickly to make needed adjustments, adapt to changes, and maintain consistent quality and efficiency.
Wrapping Up
Whatever business process improvement methodology you go for—be it TQM, JIT, kaizen, or Six Sigma—it’s important to always acknowledge that process improvement is not a one-time activity.
It’s something that you have to do over and over and over again, adjusting to challenges, trends, and demands as they manifest—or even before they do.
You get better results when you work hand-in-hand with your teams and employees to identify critical processes and root causes of challenges hindering their efficiency, then use the right automation tools to streamline repetitive tasks within the process.
When you think you have gotten everything right, establish monitoring strategies and continually review the process to identify more opportunities for business process optimization.
Further Reading:
- Technologies Powering Virtual Office Spaces
- Empowering Independence: A Guide for the Modern Independent Business Owner
- Maximizing Customer Value: A Guide to Customer Retention Analysis
- Green Marketing Definition: What It Is and How It Works
If you read to this point, it’s safe to assume that you have been thinking of what process needs improving in your business.
What was it? Your business structure? Customer retention strategies? Is it how to transition to remote work effectively? Better approaches to customer support?
Lots of things going on in your mind at the same time?
Take a deep breath and…
Contact us today to book a free consultation with Alliance Virtual Offices and explore various affordable services that can help you implement effective process improvement strategies with ease.