UNDERSTANDING PROCESS IMPROVEMENT OPPORTUNITIES

Process improvement is aimed at identifying the waste in your processes and eliminating it. It is about understanding what parameters in your processes are important, monitoring those in real time to make sure they are always on target, and then improving them if they are not.

Improving your process means eliminating the bottlenecks in your process that throttle the smooth flow of work from one process participant to the other. The process participant can be a person or a system. Improving your process means reducing your cycle times, so that you can process more orders or can serve more customers with the same resources. Improving your process means reducing the cost of processing each order, resolving customer disputes faster and, thereby, increasing customer satisfaction. Improving your process means identifying redundant process steps that can be eliminated.

In order to improve the process you need to understand what the measures for the process are. These can be referred to by various names like “process metrics,” “KPIs” (key performance indicators), “performance objectives,” etc. The idea is that in order to improve the process you should be able to describe what your process is and measure the process for its performance. Only then you can improve the process. The metrics for the processes are determined by your business goals. If quick processing of orders is important to you and your customers, then the cycle time of your order management solutions needs to be the key metric. If reducing order management cost is the business objective, then you may want to reduce the number of orders that need special processing because it is more costly.

Business people are most suited to identify the process metrics or KPIs as they are the ones who manage the business and are responsible for its performance. Business managers, whether they are responsible for order management, fraud detection, or product delivery, have certain performance targets that they strive to achieve. Because business results directly affect their performance evaluation, they want to know at all times how they and their teams are performing—so that they know if they are meeting their targets or their plan needs a course correction. That is why it is important that the business managers have the ability to define the metrics, monitor them and do something about them when they fall short of expectations. They need to do all these without needing to wait for lengthy, time consuming and costly IT projects.

 

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