Business Process Optimization: 5 Ways to Improve Your Systems and Processes
You spend untold efforts to increase your company’s profitability and drive overall growth. You’d say your company is successful, your employees are happy, and your financial reports are healthy. You’re pretty proud of the company’s offerings and believe in the value you bring to your customers.
Although, there are a few things that keep you up at night.
What if the employee who helps everything run smoothly at your company took another job tomorrow? Was that comment from a team member a poorly executed joke, or should you be worried about fraud? What if you really aren’t as efficient and productive as you think you are compared to your competitors?
Would it all turn out fine?
Possibly.
Or maybe your company could benefit from optimizing some of your business processes.
What is business process optimization?
Business process optimization is a method of evaluating your current systems and procedures in order to identify and remediate inefficiencies that could be holding your company back from your full potential.
Through analyzing your processes and identifying gaps, business process optimization can give you a valuable perspective on making improvements to your organization’s productivity and efficiency.
It can help you resolve problems where you may be wasting time and resources, identify where you might be able to improve the customer’s experience and even where you may be susceptible to fraud.
What inefficiencies do companies typically find during the business process optimization process?
Every organization is different, so business process optimization will vary widely depending on your company’s size, industry, strategy, function and mission. However, there are a few key areas that companies across the board face when looking to streamline processes.
1. Consider where you could automate
Due to advances in technology, some tasks that once took hours to complete can now be done in seconds with the right automation tools. Your team may be using antiquated, time-consuming methods without even knowing that a faster and more productive way exists. Identifying opportunities to automate is one of the key benefits of having a review of your business processes performed.
Tasks that are repetitive, frequent and predictable are excellent candidates for automation, which can potentially free up your employees to take on more complex and rewarding projects. On the other hand, things that require creativity, relational awareness or critical decision making are less likely to be a fit for automation, and your resources’ time can be better allocated.
You can determine if automating certain tasks could benefit your company by considering the availability of appropriate technology, the cost of implementation and what the impact on existing systems and processes might be.
2. Plan for transitions
If a long-term, key employee leaves your company for another opportunity, does critical knowledge about your organization go with them? What about if your organization’s executive leadership changes suddenly? Is there enough of a plan in place to keep things running smoothly?
Transitions (for better and for worse) are inevitable for every company, so it’s essential to plan for how information will be passed and how systems will be enforced when responsibilities change hands. Business continuity isn’t just about technology; it’s about retaining institutional knowledge, too.
Without a plan in place that actively accounts for transitions, your company could be greatly impacted. Ideas and procedures can be lost from one employee to the next predecessor, which leaves your new team without the data and historical knowledge that they need to effectively inform new initiatives.
Capturing information and knowledge in a way that can protect best practices and survive team transitions is essential in effective business process optimization.
3. Implement fraud controls
Many businesses underestimate the power of processes when it comes to fraud prevention, which also makes it a key consideration in business process optimization.
When you’ve implemented the right checks and balances in both your automated and manual systems, the opportunity someone has to commit fraud from within your organization decreases significantly. Additionally, having a business process review performed could potentially catch fraud that is already occurring.
It’s important to make sure that no single employee is responsible for an entire process, and separate duties as much as is reasonable—especially when it comes to financial records and transactions. Another important control to implement is limiting access to data to only the team members who need it to conduct their essential responsibilities.
4. Review your team’s capacities, strengths and interests
Do you have the right expertise focused in the right places? Do you have enough people in place to perform the expectations of the job, or possibly too many? And are those you do have in place receiving the training and encouragement they need to thrive? Are you able to retain your top talent?
These are all things business leaders need to be considering, and yet it’s sometimes hard to make decisions where people are involved.
Signs like excessive overtime and high turnover may indicate that you don’t have enough team members to fulfill your company’s responsibility. On the flip side, if your team members have a good deal of free time, or if your labor costs are exceeding your profits, you may have too many team members performing similar roles.
As part of your business process optimization, these types of opportunities and concerns will be addressed.
Once you’re confident in what your staffing needs are, it’s also important to evaluate what skills, knowledge and abilities are required in those roles.
- Do your people’s abilities and interests align with what’s being asked of them?
- Are they clear on what the company expects from them?
- Are they able to contribute to the organization in a way that aligns with their talents?
Many organizations have an understanding of their staffing that doesn’t actually reflect the reality of how roles are executed, so it’s worth investigating by having open discussions with your team.
Ensuring that you have the right people in the right spots on your team can be a huge productivity booster for your company. A passionate and well-placed team can be your greatest asset.
5. Understand your current state and develop written policies
You could have the most optimized business processes in the world, but they aren’t any good if nobody is following them. You probably have a good idea of how things should be, but it’s important to pinpoint how things are actually running.
From there, creating clearly documented and easily accessible policies leads to more streamlined projects, clearer expectations and less time wasted on explanations or excuses.
If you’re ever looking to sell your company, having a documented bank of processes and procedures also has the potential to help achieve a higher business valuation. While this documented knowledge might not have a tangible value that can be assigned, it is without question a business differentiator. If a buyer is looking at two similar businesses and one has the institutional knowledge documented and one does not, there is a clear advantage.
Additionally, it’s a form of business continuity in the sense that it allows a purchaser of your company to have access to the institutional knowledge that is often lost during a transaction.
In the end, this tangible resource of intangible guidelines makes your organization much more productive and positioned for success both in the immediate day-to-day activities and in the long term.
How do I get started with business process optimization?
Business process optimization is an investment in the future of your company.
If you want to take your company’s performance to the next level, the best way to move forward with optimizing your company’s procedures is through a business process review—a formal process that thoroughly identifies inefficiencies, streamlines your processes and positions your company for long-term success.
You know your company best, and you already understand the importance of advancing its efficiency, agility and innovation. But it can be difficult to identify areas for improvement on your own when you’re engrained in the daily life of an organization. That’s why it’s most beneficial to have a business process review conducted by a consultant.
Connect with a Warren Averett advisor who can walk you through a thorough business process review designed to make your company more profitable and effective.
