Every now and then, I have to explain what Business Process Management (BPM) means and why it is important for the business. I have never managed to do an elevator speech on this one: BPM seems so abstract to everyone that it takes me forever to only give an overview. If you have ever been in a similar situation and wondered how to describe all the benefits of BPM, this article is for you.
A short summary is presented in the infographic below (based on this source); the long explanation follows underneath.
Benefits of BPM
Enhanced Quality of Products
- Setting internal company/organizational product goals (e.g. Acceptance Criteria, KPIs, customer satisfaction levels): Especially helpful when those are not provided by the customers themselves.
- Minimizing the number of bugs by e.g. performing Trend Analysis (i.e. pro-active Error Management): For that, you would need a well working reactive Error Management process to collect the data.
- Minimizing or completely eliminating customer escalations on production issues and/or breach of contract: One of the main goals of the Product Development Lifecycle (PDLC) optimization is to move bug identification & bug fixing as early as possible in the production cycle. The ultimate goal is to prevent bugs from leaking out to the customer.
Reduced Costs & Higher Revenues
- Finding problems earlier in the process lifecycle (e.g. bugs found in development, as opposed to in production, risks identified and mitigated before turning to issues, process noncompliances found and remedied before a certification/customer audit is at risk, etc.): The earlier the problems are identified, the cheaper they are – and vice versa.
- Handling risks and identifying opportunities: Identifying and mitigating risks can bring the costs down, whereas identifying and acting on new business opportunities can bring the revenues up.
- Properly identifying Change Requests: If the processes are not well defined and performed, it will be hard to distinguish between requirements analysis and bugs, on one hand (part of the contact), and new requirements or changes to existing requirements, on the other (outside of the contract – subject to negotiation, approval, and additional charges).
- Increasing automation: When the process is defined/described, it can be analyzed for optimization and automation. Automation should substitute manual work whenever possible to make the process faster, cheaper, and more reliable.
Improved Business Agility
- Increasing the ability to handle large throughput (e.g. 5-10K customer requirements): Just like in manufacturing, standardization increases the ability to manage big(ger) scope with the same amount of resource (time, capacity, budget).
- Scaling the business (e.g. working in multiple programs, Scrum of Scrums, etc.): A scaled company Quality Management System (QMS) supports better the business and the organization in times of change. In general, the QMS and the organizational structure have to be fully aligned, because they depend greatly on each other.
- Enabling overall continuous improvement: Since the world is not static, we always have to change and adapt, but not all change is an improvement. To ensure changes are for the better, and that by improving something we are not breaking something else, we need that clarity over the bigger process picture and its intended outcomes.
- Improving process interfaces (inputs and outputs): When the process inputs and outputs are properly identified, it is easier to introduce changes without breaking the links and risking that the whole QMS becomes dysfunctional.
- Incorporating Lessons Learned and Re-use into the next process cycle: A well-structured and maintained QMS can improve itself too – just like a healthy organism can heal itself when needed. Having the re-use concept embedded into the QMS has an even greater importance for eliminating redundancy and waste of resources.
- Seamlessly redefining tasks/responsibilities when changing the strategic direction and/or organization: It is a lot easier to change one or two pieces of the puzzle rather than all of them, especially if we are not even sure what the overall picture should look like.
“Great things are done by a series of small things brought together.” − Vincent van Gogh
- Having clear documentation and communication structures and procedures in place (incl. backup, archive, and restore procedures): Having clear definitions and communicated expectations of who has to do what how and (by) when minimizes the redundancy, frustration, resource wastage, employee turnover, etc.
- Real-time monitoring and reporting: When processes are defined, they can be measured, controlled and improved.
- Increasing the confidence in reaching the set targets (internally & externally): If we see the set targets are at risk of not being met, we can adjust our course or actions sooner, rather than later.
- Knowledge-sharing: Processes and procedures can be set in place in such a way that the silos are broken and a seamless resource (e.g. information) flow is enabled. HR can be of great help specifically in this area.
Higher Efficiency & Accurate Planning
- Minimizing or eliminating delays (and consequent penalties): Having clear processes enables earlier and more accurate prediction, as well as a change of course in due time.
- Handling resource, capacity, or prioritization issues, which prevent adequate execution: Establishing the process interfaces makes it easier to identify prioritization issues, as well as who, when, and based on what data has to make the prioritization call. Typically, prioritization issues are hidden behind problems like lack of capacity.
- Avoiding customer interference or micromanaging: If, for example, the customer becomes uncertain that their targets will be met, we might expect them to request a customer audit/assessment or to directly come onsite and sit next to our Subject-Matter Experts during the whole time that they perform their tasks. Needless to say, this is not a good working environment for our employees and totally not the relationship we want to have with our customers.
- Minimizing or eliminating the “fire-fighting” mode (e.g. spikes in the trends for resolution of bugs, customer reports, root-cause analyses, delays, etc.): Fire-fighting usually occurs when risks or issues were not detected early enough when we still had the chance to either prevent them or minimize the damage. With strong processes in place, such events are the exception to the rule, rather than the normal ways of working.
- Avoiding bottlenecks, single points of failure, work in silos, etc.: Such issues can be identified and respective solutions can be successfully implemented if there are defined processes in place, which can be analyzed for improvement opportunities.
Increased Employee Morale
- Creating a sense of purpose: Knowing why something exists is just as important as what that something is. The example of the opposite behavior and its consequences is described in the 5 monkeys & a ladder experiment.
- Driving out fear: When people are guided to improve the system, and not following a broken one for fear of being punished, this embeds quality into the daily work life and decreases the dependency on inspection to achieve quality.
- Enabling autonomy and providing leadership (as opposed to supervision) in the direction of continuous improvement: With full transparency in place, we immediately know if a process is under-performing. However, the emphasis is always on the process (as part of the bigger system), not on the person. Therefore, the main goal of leadership is enabling the system and all of its parts to perform in their most optimal way – and stop there. (FYI: more on the value of autonomy.)
- Instilling a sense of belonging and restoring pride in workmanship: Having common goals, clear roles and responsibilities, and transparency in terms of execution are some of the crucial elements for maintaining the employee motivation. It is also a mandatory pre-requisite for enabling autonomy.
- Establishing a clear professional path/growth: Clarity in the rules around providing acknowledgment for a job well done removes double-standards, unhealthy competition, and obstacles to achieving the goal.
- Increasing loyalty: Naturally reap of the benefits of having all employees work to establish and maintain the best image of the company.
“Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.” − Richard Branson
Compliance, Safety & Security
- Fulfilling demands from the business and the customers: Embedding an external standard or a customer/internal quality requirement inside the QMS makes the company compliant with it, without causing a disruption to the business.
- Enabling process compliance and commitment to quality as part of everyday life (e.g. no panic mode and no impact on product delivery when external audits/assessments are due): The QMS we all want is the one which is alive, not put on a shelf and only dusted off when an external audit is due. This is also the reason why auditors are not as strict with what is written down as they are with what is understood and performed by all.
Improved Customer Relationship & Satisfaction
- Establishing a standard Product/Service Catalog (with Demos, as applicable): Having a well-defined list of what we offer and what the customers can benefit from is where our relationship with the customers usually starts.
- Providing an overall Solution Design (based on the Architectural & Detailed Designs): Having a product structure in place means having a well-structured architecture too. Therefore, it becomes a relatively easy task to put all products/features together and present the customer with an overall Architectural Design for their specific solution.
- Ensuring full traceability is in place (e.g. tracing back to an issue introduced in a given release, test coverage for all customer requirements, rolling back to a previous release, etc.): On one hand, full traceability enables us to identify and implement improvements, from which our customers are benefiting directly. And on the other hand, full traceability (sometimes in combination with baselining) protects us from abusive customers.
- Not being impacted by a faulty or missing QMS on the customer’s, partner’s, or supplier’s side (e.g. when the external party is missing processes, product concepts, Definition of Done, etc.): When process interfaces are defined, criteria for input and output work products are also defined.
- Incorporating customer feedback into the next process cycle: Same as with lessons learned, the customer feedback provides material for identifying opportunities for improvement.
If your company Management is now committed to implementing BPM, here is how to start.