Business Process Improvement (BPI) is a method for evaluating the current processes of the business as a baseline to create business transformation and a streamlined future state. This is done for large processes, such as new product development, order-to-delivery or an entire supply chain; or more focused processes like recruiting, hiring or onboarding.
Business process improvement is often implemented by a skilled business process improvement consultant who works closely with clients. It involves change management and streamlining processes in departments such as Human Resources, Supply Chain, Information Technology, Operations, Customer Services, and Finance.
To help you get started, Supply Velocity’s consultants will conduct an Assessment, using Lean and Six Sigma tools / frameworks / models to achieve fast, sustainable results. In addition, every Supply Velocity consultant is experienced in facilitating cross-functional teams to ensure the team does not get bogged down in conflicting ideas and objectives.
Are Inefficient Processes Holding You Back?
Often, poor business performance is a direct result of process inefficiency, not employee capability. As companies and marketplaces become more complex, processes that once worked can fail to meet new demands. Additionally, start-ups and small businesses grow out of their processes. What worked with a small team can fail the customer and employees when new customers and employees are added. Here are common business process improvement examples and problem areas we identify and address:
- Long order lead times and poor on-time delivery
- Complex processes with a critical bottleneck, many steps, hand-offs, and rework
- A highly reactive organizational culture
- Misaligned organizational structure with confusing roles
- Lack of standardization and process discipline
- Poor and inconsistent product or service quality
- Difficult to do business with
- Poor customer service and internal communications
Our Methodology: A Clear Path to a Better Future State
The first step of BPI is Business Process Modeling. This structured methodology provides the roadmap to optimize your operations and achieve lasting transformation, which can take from a few weeks to a few months.
The Steps of Business Process Modeling:
- Map the Current State
- The current state represents what we call the ‘good the bad and the ugly’. It includes all possible variations of the process including the informal steps people can take to workaround a slow and inefficient process.
- It is easy for people to want to map the how-to or future state but it is important that the first step to be only the current state.
- Once complete, the team can clearly agree on the process’s current state and the issues plaguing it.
- These small agreements (everyone agrees the current state map represents what happens now) can create early alignment to help with more difficult decision making later.
- Sort the Map
- The map is marked to identify and highlight non-value-added steps within the process.
- We use three colors: Red = non-value-added and should be eliminated, Yellow is non-value-added to the customer but is necessary for the business, Green is value-added to the customer.
- When sorting, everyone has a ‘vote’. If there is disagreement it gets worked out so each step in the process is either red, yellow or green.
- This is another example of getting aligned.
- Brainstorm Ideas to Eliminate Waste
- This step focuses on simplification, efficiency, and potential workflow automation.
- Some improvements can be simply ‘stop doing it’. Others require policy changes or moving a step earlier or later in the process. This may involve shifting the work to a different role in the company. For example we may move work off of a Sales Representative to Administrative support.
- Other higher cost improvements may include new software or machinery, or modifying software.
- We always prefer the simpler, lower-investment ideas.
- Prioritize Ideas
- Ideas are ranked based on Benefit versus Difficulty-to-Implement.
- We start with the easy-to-do and high benefit ideas.
- High benefit but high cost require additional evaluation to ensure return-on-investment.
- Low benefit and easy-to-implement can get done any time.
- Low benefit and difficult ideas are saved for future evaluation or discarded.
- Design the Future State Map
- This step can seem complex but the easiest way to create the future state is to simply remove the non-value-added steps (red) identified and eliminated in steps 3 and 4.
- Create an Implementation Plan
- This becomes your formal business process improvement plan and roll-out strategy.
- We create a detailed action register to track the completion and implementation of the ideas that eliminate the non-value-added steps.
Beyond Implementation: Sustaining Your Gains
After Business Process Improvement is implemented, you must sustain the gains. This is key to true business transformation. Sustainment requires measuring the performance of processes through Balanced Scorecards and monthly Scorecard reviews. This cadence of measurement and action creates a virtuous cycle of continuous improvement and ongoing optimization.
Meeting Internal Goals & Metrics:
- Greater capacity and throughput
- Improved labor productivity
- Less rework and reduced scrap
Meeting External Customer Requirements:
- On-time delivery
- Improved quality
- Easy to do business with, creating a sustainable competitive advantage.
Creating a Balanced Performance Scorecard:
Balanced performance scorecards often use different categories of metrics. These include metrics that fit in the five categories below.
- Operational efficiency
- Financial performance
- Customer success
- Employee satisfaction
- Innovation
Optimization Journey Starts with a BPI Assessment
Personnel are usually aware of problems but often don’t understand the root causes, and their daily work demands don’t provide an opportunity to make the necessary changes. It can be a classic example of not being able to “see the forest for the trees.”
Supply Velocity’s Assessment is the starting point for our consulting services and one of our most popular offerings. It includes a targeted assessment of core processes, interviews, a facility review, and data analysis. Our consultants develop a list of prioritized recommendations supported by data, and provide a roadmap for implementation, timing, requirements, and return-on-investment.
Why Start with Our Assessment?
- 90% of our new clients choose to have an Assessment
- 80% of Assessments result in using Supply Velocity for implementation
- Clients invite us back for an average of 4 more projects
- 95% of our sales come from referrals
A typical Assessment is a 2 to 4-day process involving:
- Interviews with key personnel (executives, managers, and individual contributors)
- Analyzing financial and operational data
- Facility tours and direct observation
The onsite portion is swift and hands-on. Our business process consultants engage with your workforce to ensure they are involved and comfortable, and to recommend key personnel for the project teams.
A Legacy of Business Process Improvement Methodologies
The methodology for Business Process Improvement has built up over decades, starting with the quality revolution and including various business process improvement methodologies and best practices:
- The quality revolution in Japan (Juran and Deming), circa 1950
- Toyota Production System (TPS), 1950’s to 1970’s
- Six Sigma developed at Motorola, 1980’s
- Business Process Reengineering (BPM), 1990’s
- The combination of these into a unified lean six sigma approach in manufacturing, warehouse, supply chain and services, 1990’s – today
Variations include Business Process Reengineering (BPR) or Business Process Management (BPM). As the scope increases, BPM looks at an entire business process to create a workflow that is more effective, efficient, and capable of adapting to a rapidly changing business environment and new market demands.