Business Process Improvement

A question often asked of us is: “Why does anyone attempt BPI?”

The answers are many and varied but typically include reasons of;

• strategy execution
• business streamlining, Transactional Process efficiency, cost reduction
• customer service
• increased throughput
• improved margins
• lower working capital costs
• managing compliance
• preparing for mergers and acquisitions
• preparing for the implementation of new IT.

These reasons all suggest a desire to improve the Return on Capital Employed (ROCE) and therefore our answer to the question is simply;

“To improve the Return on Capital Employed.”

What is a Process

Our experience is that most managers find it difficult to define a process in any great detail. There are two main reasons for this;

• A Transactional Process does not exist in its own right (anymore than an organisation does). One cannot go the shelf and take off ‘a Transactional Process’ (luckily, however, one can make a diagrammatic representation of a process). A Transactional Process is simply a collection of habits, both people’s and machine’s.
• A Transactional Process is invariably not a single ‘process’; its is a collection of ‘pathways’ along which the work will flow until the end point is reached

The impact of this is that to improve the Transactional Process you have to understand and influence individual pathways, thereby changing the collection of habits. This is a relatively straightforward (and therefore fast) when you understand processes.

Our Approach

Stage 1: ‘Current Mode’ Analysis

We use a process modelling tool called Holocentric Modeler to capture the ‘As Is’ Transactional Process map and to enable process analysis. This tool is akin to ‘Visio on steroids’; instead of producing ‘flat’ Transactional Process diagrams of limited value, it adds a third dimension to a Transactional Process map, namely the ability to model the performance of a Transactional Process. The Transactional Process metrics typically captured include;

• times (work times, elapsed times per process step)
• volumes (input volumes, process pathway percentage volumes)
• costs (of roles performing the Transactional Process steps)
• high level work instructions (2-3 dot points per step)

We work closely with the Transactional Process owners who are most familiar with the process to produce the ‘As Is’ maps in 1-2 hour workshops. Alternatively, they can often be imported from MS-Visio if that’s how they’ve been mapped, thereby saving time.

This stage generally takes us a single day per Transactional Process, and produces the following output;

• an ‘As Is’ Transactional Process map
• ‘As Is’ process metrics for ongoing monitoring including:
  Work time (drives cost), Elapsed time (drives service level), Full Time Equivalent (FTE) requirements, by Role, by Process and Weighted average costs
• high level, draft work instructions, as auto-generated MS-Word or HTML documents

Stage 2: ‘Future Mode’ Definition

Stage 2 is all about;

• critiquing the ‘As Is’ Transactional Process maps
• documenting a statement of high level future process capabilities
• transforming those capability statements into the ‘To Be’ map in Holocentric Modeller
• the production of a comparable set of key metrics to those in the ‘As Is’ process
• the definition of a high level business case for change based on these key metrics.

Once again, we work closely with the Transactional Process owners to refine the ‘As Is’ process critiques, define high level capability statements, and review and validate the ‘To Be’ maps in 1-2 hour workshops.

This stage generally takes us a further single day per Transactional Process and produces the following output;

• detailed process pathway analysis and bottleneck assessment. This will highlight which current paths and associated steps contribute to excess process times and costs,
• a ‘To Be’ Transactional Process map containing the recommended and agreed process changes
• ‘To Be’ path analysis and opportunities assessment.
• ‘To Be‘ process metrics for ongoing monitoring including:
Work time (drives cost), Elapsed time (drives service level), Draft Service Levels required, Full Time Equivalent (FTE) requirements, by Role, by Transactional Process, Weighted average costs and any other identifiable benefits encountered
• a high level business case quantifying the benefits of change
• high level, draft work instructions, as auto-generated MS-Word or HTML documents

Here's a graphical summary of the Transcational Process Improvement;

Illustration of the Transactional process by identifying and addressing pathways