A Guide on How to Optimize Business Processes
Business process optimization, or BPO, is the idea of improving specific elements of how people work to advance business goals. In other words, improving individual “processes,” whatever those happen to be.
Think of a business process as an isolated component or module within a greater set of business operations. When companies identify these individual business processes and how they can be improved, they can start to build in efficiencies, and make these individual processes more effective. Words like ‘tasks’ and ‘workflows’ can be synonymous, but concrete examples help, too. For instance, in a manufacturing business, the moving of raw materials to a bench to make a product can be a “process.” Ditto for a software testing or beta regimen in tech.
To optimize a business process, planners have to start from that identified workflow, and build toward a desired result. A lot of this has to do with the advanced analysis that now drives so many kinds of business insights.
Business Process Optimization Techniques
With an understanding of process optimization in mind, it helps to go over how business process optimization works in a practical way.
First, the stakeholders identify the process and any deficiencies that might be evident. From the deficiencies they build the goals that drive that business process optimization. Take a look at practices like value stream mapping as process examples. The process of stream mapping represents one way to visualize processes and start to analyze them in detail.
Then there is the element of discovery that often has to do with getting feedback from stakeholders. For instance, in a software development process, if the process involves, say, three or four departments including sales, engineering, product development and network administration, all of those people in each of those departments, can contribute different ways to optimize the business process. The discovery element of optimization is enhanced when everyone involved in the process from each department contributes, which can then empower decision support analysis.
Another corollary tip is to map out the process and look at its combined steps.
Finally, there is the idea of using new software and new technology to drive business process optimization. Business process optimization technologies let organizations see specific actions and behaviors that go into a process, so not only is the overall process improved but granular activities that make up the process become more efficient too.
Think about new methods of analytics that make business processes more transparent and visible. Maybe the business process is all digital, taking place in a series of software and programming environments. To the extent that the company can scrape the data and user activity from these environments and put it all together. Then, planners can build a full picture of how the business process works in order to optimize it.
Benefits of Business Process Optimization
So what do you get when you practice better business process optimization?
These are some of the critical benefits that businesses see as they develop their internal processes.
Cost Savings and Increased Revenues
Far and away the biggest benefit, and the most concrete one, is cost savings. As you pursue business process optimization that makes what you do more efficient, you see money open up in your budget. That’s a real value for companies that put these strategies in play, but the benefit doesn’t end there. Many firms can also see increased revenues, through higher productivity that results in greater output.
You also often see everyone, from managers to front-line workers, benefit from less stress and less tension as they find better ways to do these core processes. That can lead to higher productivity and better morale in general, and lower turnover, which also benefits a business in terms of cost.
A simple way to put this is that when you have BPO in place people have more time and energy to look at core processes. In other words, with a lot of the ‘headache’ stuff off the plates, they focus on what’s important.
Where there is waste, BPO helps planners to seek it out and eliminate it. Finding better ways to work simply makes processes more effective, and that is something that all sorts of department leaders and other stakeholders can see evident value in.
Examples of Business Process Optimization
Let’s look at some specific examples of how business process optimization may work.
In call centers, business process optimization often involves optimizing the call process, from the dialing to the eventual contact documentation. This is where the company might look at each individual step and then combine all of that data to make decisions. They might evaluate, for example, whether the autodialer technology is targeted correctly to provide not just “some throughput,” but the best throughput rate possible. They may look critically at scripts, or call metrics, or hardware –or, for instance, how agents access data during a call, how long they take entering information into a form field, or how they handle different kinds of calls (ex: long calls vs. short calls.)
In a manufacturing environment, planners might want to improve the way that products are packaged. In this case, they might look at attributes of the process like resulting size, weight, shape and portability. They might look at how user-friendly the packaging is from a customer standpoint. They might look at what energy is required, and what tools are required, to package the products. With all of those things put into a neatly digestible reporting format, the company gets the insights that it needs to improve operations.
Or suppose the company is intent on improving social media advertising processes.
Here, a lot of the metrics that are gathered are demographic user information. The company might look at every channel and identify rates of conversion and rates of engagement, and then build around those metrics.
Similarly, there is the example of A/B testing for marketing. A/B testing is an established technique where a company is going to take two different instances of an ad or marketing campaign, and run them in the same baseline environment. Then they see which of the two is more effective. This, too, is a form of business process optimization.
In sales, there is the idea of redefining the sales pipeline – optimizing selling processes. This might involve changing how salespeople contact the customer, changing the resources and literature that they give the customer, changing the way that customers contact sales, or any number of other changes. The key is to isolate those things that drive higher conversion rates, and that’s something objective, something that one can measure.
Business Process Optimization Tools
Behavior analytics is key to collecting the objective process data you need to begin your business process optimization strategy. Activity monitoring tools work best for producing this type of data, but some monitoring tools are more capable than others. Take a data mining and visualization tool like Teramind, for example. Teramind not only collects the user activity necessary to make data-informed process decisions, it also comes equipped with data analysis mechanisms like user and entity behavior analytics, or UEBA. When the company can use these types of tools to mine user sessions, including app and website usage, videoconferencing and product processes, what they get is a powerful activity data source for their BPO efforts that lets them understand every granular action their workforce takes on a regular basis. After all, the pathway to improving processes is to evaluate them in very detailed ways – and to do that, you have to see everything that’s going on inside of a workflow.
What drives effective business process optimization?
In that way, BPO is very much a specific flavor of business intelligence, and benefits from big data science in the same way that other forms of BI do. With customer relationship management, sensor-based point of sale analysis, predictive marketing, and much more, the modern business is poised to work smarter, not harder, to achieve market share and other goals. How they do that, to a large extent, depends on what’s in their toolbox.