If I told you that you could reduce your business costs by up to 30% with just time and effort and no cost I’m sure you would want to know how. But if I told you that you would do it through Business Process mapping what would your reaction be? Many business suffer from customer complaints and find themselves engaged with rework or fixing errors. All of these things lead to increased costs, declining profits, customer complaints and employee dissatisfaction. In the past I have been tasked to reverse these business problems, and nearly always I use Business Process Mapping. Its value is in delivering significant business benefits if you take process mapping to the next stage.
So whatever your views read on and let me tell you….10 Reasons why you should map your Business Processes
1. Allows you to see the variation within a process and improves response times
Variation is when the same process is executed differently by each person within that process. If a process is not documented or adhered to, people will devise their own way of doing things. The processes can tend to become heavily manual and encumbered with non value activity. When things go wrong, rather than fix the root cause, people will invent complex and reactive work arounds. Variation means customers don’t get a consistent experience.
Imagine you hire a car from Company A. When you return the car person 1 deals with you quickly, returns your deposit and you’re on your way. The second time you hire from them you get person 2. This time they tell you that they will need to inspect the car before they return the deposit. They take ages to get this done and you are kept waiting before they eventually return your deposit. Why didn’t the first person inspect the car while the second person did? Variation. And variation causes loss of revenue, increased cost and customer dissatisfaction.
2. Helps identify opportunities to reduce business cost
Of course if you have a consistent and standardized process, which removes variation, removes non value add activity, reduces cycle time and removes waste it will take out cost from the business and more than likely increase revenue. It’s an opportunity to see how you can reduce handing tasks from one part of the process to another by multi skilling teams. This is a whole topic on its own which I will cover another time. So let’s leave it there and move onto number 3 which is …
3. Simplifies training
So if there is no process, no standarised way of doing things then how do you train someone? And going back to the car hire example who trains a new recruit? Person 1 or person 2? If training is being done by people who have devised their own process, their own way of doing things, then how effective will the training be? Processes that are alive and visible to any member of the business will have a visual understanding of how things SHOULD be done. They can be used to formulate training documents which can be accessed from an online knowledge base
4. Improves Customer Satisfaction
Process mapping, and subsequent improvement will increase customer satisfaction by identifying the actions that will remove the defects, the things that go wrong, and need fixing for the customer. These defects can lead to rework and even complaints. If you reduce non value activities and tasks you will improve cycle time and reduce costs. And if you reduce costs you can pass these savings onto the customer to make your product or service more competitive. That’s a win for you and a win for your customer
5. Improves Employee Satisfaction
I have seen a lot of friction between teams, each blaming the others for handing them “crap work”
When you map and document the process each employee gains a shared understanding of the work that is done across the whole organisation. It stops people working in silos and gives employees visibility of who does what before them and who does what after.
It also allows feedback loops between the different departments. It allows an escalation path to be built into the process to highlight when deadlines have been missed, or a service level agreement has been broken. And of course, with less variation, lower costs, reduced complaints and improved customer satisfaction it also becomes a nicer place to work. And maybe, if they are spending less time reacting to problems and fire fighting they will be able to work less hours and have a better work life balance?
5. Enables system changes and efficiencies
When you map the processes, and record the IT systems that support them, it allows you to see potential opportunities for efficiency. For example if manual work is required in the process to match data from one system to another you could remove that manual work by a simple change in the systems. You can see potential to reduce licence costs, retire systems or retire 3 systems and replace it with one.
Let me give you an example. In a recent project a manual reconciliation was required for staff accounts where each staff account needed to be checked that it was actually owned by a staff member. Often staff accounts were set up and not closed when the employee left the company, and this resulted in them still having access to the staff discount. Because the billing name was different, with shortened names or intials etc, to the HR system, data was taken from both and manually compared. A simple fix to add the employee identification number to the staff account in an empty field on the billing system meant the data could be clashed with the HR system without manually checking the name on each staff account. Process maps are also particularly useful when it comes to an ERP implementation project, and can save time, costly mistakes and budget over spend.
7. Makes it easier to scale your business
So if you are at a point where you want to scale up then documented processes make it easier. Its hard to scale when you don’t know who does what and how many times. And you will be unable to model the impact as you grow
8. Enables selling and merging
Equally after a merger or acquisition it’s easier for businesses to understand how they can be integrated if the processes are visible and well documented.
And if you decide to sell then it’s easier to sell a business that has control over its processes. Any potential investors can see how well the business is run with supporting processes and data ratifying the results
9. Allows easier organisational design
Once the dust has settled on any cost reduction projects, a set of documented processes can give visibility of the work done in which location and by which team, particularly if teams are merged. This in turn helps build a new operating model and align the new organisation.
10. Helps identify risk and mitigate against it
Process mapping, along with the associated measures helps larger firms with compliance and auditing.
Many large industries have their own regulatory bodies whose requirements and regulations must be complied with. Quality standards such as ISO 9000 will benefit from a documented set of processes come audit time.
I’m hoping that you’re feeling inspired and energized to either map your processes or review the ones you have and make them more accessible.
As Deming once wrote “If you can’t describe what you are doing as a process, you don’t know what you are doing”
And if a picture paints a thousand words then a process map paints a whole ebook surely? Happy mapping.