Over the lifetime of an organization, processes tend to evolve incrementally, and the consequent patchwork may often be detrimental to efficiency and control. They also tend to follow organization structures and degenerate into functional silos rather than true value enabling business processes.

Therefore, periodic examination and redesign of business processes
with a view to maximize their alignment to organization goals
becomes an important part of organization development.

Business Process Management can be examined in three fundamental dimensions: Consolidation, Technology, and Transformation.

Consolidation

In a large organization, it is necessary to consolidate support function business processes into a few locations and inside a single organization structure. In the past this was physically impossible to achieve in a widespread organization. With the advent of a vastly superior information technology, it is now possible to consolidate even globally. Consolidation provides the following important benefits

• Achieving scale to enable adoption of technology
• Faster implementation of transformation
• Greater ability to maintain harmonized and transformed processes and delay the inevitable process of entropy.

Consolidation is usually achieved by the means of a shared services initiative. The structure of shared services, be it captive or outsourced, is driven by organizational preference, strategy or capability that dictates the structure of shared services.

Technology

Information Technology is a second dimension of Business Process Management. In some ways it is a prerequisite for achieving the first dimension of consolidation. It is also a major enabler to achieving the third dimension – transformation. In the first phase, technology is key to enable the following obvious characteristics of an efficient process

• Speed: Cycle times for processes are crunched and the processes can better serve the business on time
• Robustness: Technology enables robustness and reliable repeatability of processes
• Scale: Minus technology it would almost be impossible to support the volume of transactions, especially in a consolidated globalized set up.

However for true world class processes, technology must rise to a higher level and provide the following benefits

• Analytics and the ability to synthesise information from data
• Ability to cut across functional silos and enable true end to end business processes
• Enhanced control required for a global and diverse business

Transformation

With technology and consolidation, comes the opportunity for transformation of business processes. It would be an extremely sub-optimal and even futile exercise, to simply consolidate and automate transactions and leave business processes at their same inefficient level.

Transformation involves the examination of current business processes
and the movement to an optimal process that serves
the business best in terms of efficiency and control.

Elements of transformation include

• Streamlining of business processes eliminating unnecessary steps that neither enhance efficiency or control. A smooth minimal process that can best serve the business, without sacrificing control is the aim.
• Designing and operating business processes in tune with a business objective rather than a functional silo. In this design, Finance, HR, etc become irrelevant nomenclatures for transactional processes; Purchase-to-Pay, or Hire-to-Retire become more meaningful. These pertain purely to transactional business processes and not to functional strategies which of course maintain their high relevance in businesses.
• The processes are optimal in terms of speed and cost.
• The processes provide constant information (not data) for business excellence

Business Process Management is therefore a journey which organisations tend to take in steps. In some organisations, consolidation precedes transformation. In others, they happen concurrently. In some organization they begin with a few identified processes and gradually spread to other processes. In other organisations multiple processes are stacked simultaneously. Usually finance heavy or HR heavy processes tend to lead the evolution of Business Process Management. Selling and marketing process tend to follow.

Whichever manner an organization chooses to employ,
Business Process Management is now proving to be a
fundamental and essential part of service and support functions.

 

 

ABOUT THE AUTHOR