Today, the business community talks a lot about the process approach to managing business processes, and optimizing them. And, it would seem, everyone uses the same approach and well-known terminology, but when the project begins, it turns out that there are significant discrepancies not only in concepts. It is also in methodological approaches to process management.
In this article, an attempt is made to classify the main features that distinguish a particular approach. This classification will help managers evaluate their own projects and compare the various proposals of consultants in the field of business processes.
Analysis of methodological aspects in the field of process management made it possible to identify characteristics by which approaches can be distinguished.
Let us consider in more detail the classification features and methodological approaches.
The most noticeable feature by which approaches to process management differ is the directions and boundaries of changes in the project.
Approaches
1 # Gradual Improvement
Gradual improvement of business processes in the enterprise. This approach involves improving each process online. Japanese management gravitates to this type, when organizations are constantly in the mode of improving processes, and performers perform the task of continuous improvement of their work. The Gradual optimization is associate with minimal risks and resistance from the staff. But there is also a negative point – the time factor.
In today’s rapidly changing market situation, managers are require to be able to quickly restructure business processes. It is carry out cardinal innovative changes. If the company has been following tactical goals for many years and special attention has not been paid to the management system. So many problems may accumulate that their solution in an expeditious manner will become impossible – a more radical project will be required.
Gradual improvement is certainly suitable for non-crisis enterprises characterise by relative stability of activity. The project itself in this case will not be the introduction of optimisation measures, but rather the adjustment of the management cycle for all processes.
2 # Optimize Local business Processes
The second approach is to optimize local business processes in the organization. Each new project is the improvement of a separate business process. Moreover, the description and optimization of them are not related to each other, and some aspects of the activity may not be covered by transformations in principle. This path is usually follows by companies, where critical success factors are concentrating in specific areas of activity, they are clearly localise.
Optimization of local business processes does not require a radical transformation of the system as a whole. Many experts do not attribute such projects to the process approach. Since there is an opinion that only a complete process model is the goal of transformation. However, some techniques allow you to optimize only at the local level.
3 # Re-engineering
The third approach is re-engineering or drastically redesigning business processes in an organization. A large-scale re-engineering project is associates with high risks. It is suitable for those who are confident in their abilities, and want to achieve an improvement in all performance indicators in the shortest possible time. All activities should be carrying out under the close attention of the top management of the company. The probability of failure is so great that the issues of professionalism of the manager and project participants and a strong motivation for change (for example, the problem of survival) become critical.
Distinctive features of the methods that adhere to the fundamental transformations of all existing processes are the centralization and scale of changes. A single format for the description and optimization procedures.
Despite the fact that the classification feature “directions and boundaries of changes” is one of the main ones in choosing a methodological base, other criteria are no less important. As can be seen from the table. We identifying the second feature that distinguishes one approach from another – the sequence of project stages.
As a rule, in the methodological materials on process management, three main stages of model formation are clearly identified:
“As is”;
“As it should be”;
Transition.
Most techniques involve the creation of a business process model “as is” with subsequent optimization. Thus, the painstaking work on the description of existing business processes comes to the fore in order to further analyze and improve them. The description of business processes is likely to cause a negative reaction from project participants. Since the drawn business processes rarely help in further optimization. (Decisions about changes are often so obvious that the efforts spent on formal fixation of shortcomings can be attributed to excessive).
In deep !
An alternative version of the sequence of work is that both first stages are carrying out in parallel, and optimization is need to provide already during the description. Very often, even before the end of the development of the model “as is”, specialists try to make changes in business processes. Thereby anticipating the formal stage of developing the model “as it should be“. As a result, there are not two, but one reference scheme of business processes. Which is constantly supplements or changes.
The disadvantage of the parallelism of the stages can be consider a large number of transformations and their protracted nature. But there are also approaches that exclude the stage of creating a model “as is”. The modelling of an ideal enterprise “as it should be” (based on the main meaning of the enterprise’s activity) comes to the fore here. And the project itself in this case is a kind of transfer of the organization to the state of “as it should be”, regardless of its characteristics at the moment.
Specialists only have to put “ticks” on the functions and information flows of the ideal model. Which has already been developed based on the mission of the enterprise, and note what needs to be finalised. By moving the “as it should be” stage to the first place, the enterprise receives a significant reduction in implementation time.
However, in practice, this is rarely utilized because the scientific and methodological foundation of most proponents of the process approach is too weak to develop comprehensive and coherent models of the enterprise “as it should be.”
Methodological approaches
The next difference in the various methodological approaches to the implementation of projects is the role of third-party experts in the project and the degree of staff involvement. Professional forums and conferences repeatedly raise the controversial topic of the role of third-party experts (consultants). Almost all books on innovation and change management in the organization contain recommendations for maximum employee involvement in the transformation project.
Analysis of various approaches to the implementation of process management shows that not everyone adheres to this principle. The participation of consultants, in our opinion, should be reduced to methodological and supervisory functions. Information about the implemented projects of consulting companies shows that often consultants directly perform work on the description, analysis and design of business processes. From the enterprise, at best, the created working group or one responsible person participates in this work, helping in the organization of interviews and approvals. Something in between can be considered the joint work of consultants and specialists of the enterprise in project groups.
The role of consultants in the project is determined by the type of consulting:
Expert, process, training. Studies of numerous enterprises in the United States have recognized training consulting as the most effective. We hold the same point of view, and we very much hope that the methodological approaches of Russian consultants in the field of building management systems will change in this direction.
Another aspect related to the role of business process owners:
There are methodologies where they themselves determine the standards and criteria for the effectiveness of their activities, there are approaches when the owners only accept the norms for execution (developed by a higher authority or a special unit for organizational development).
The fourth significant difference, as can be seen from the table, we defined the principle of allocating the boundaries of business processes. This issue is the most controversial topic among the scientific community at present.
Adherents of the “end-to-end” approach see the implementation of process management in the following:
- All processes in the organization are cross-functional in nature and flow through various departments;
- Process owners are responsible for the entire value chain of a particular product (service);
- Process owners do not have resources at their disposal and “acquire” them from functional services;
- The first manager reports to two types of managers: strategists responsible for value chains and resource managers, who are responsible for the level of costs in their functional area;
- As a result of the end-to-end approach to the reorientation of areas of responsibility, the organizational structure is significantly flattened and expanded horizontally.
Thus, the “end-to-end” approach is accompanied by significant changes in the management system, which in turn causes staff resistance and an increase in risks related to the failure of the project at the implementation stage.
Softer is the allocation of business processes according to the segmented principle:
- Business processes typically define their boundaries based on subdivisions or positions;
- Processes represent functions of structural elements interconnected by inputs and outputs;
- We appoint individuals responsible for each process based on their hierarchical positions and provide them with the necessary resources. They usually bear responsibility for the outcomes and costs associated with the process;
- The senior manager oversees process owners within their subordination, following the functional management structure. We determine the quality assessments of their work horizontally across processes.
In addition to the “end-to-end” and segmented methods. A third option exists where processes allocate according to the type of logistics chain. Sometimes, processes follow an “end-to-end” approach, while at other times, they adopt a segmented approach. For instance, this allocation can depend on the type of production (in-line, serial, design/individual). The type of production can, in principle, make it impossible to implement “end-to-end” process management. Unfortunately, not everyone understands this.
The set of business processes attributes
A set of business process attributes is another topic in the field of process management on which there is no unequivocal opinion. An attribute is an inherent property of a business process that must be formalize. For example, the required attributes in any approach are the name of the work, input and output, mechanism. Management assumes a mandatory attribute (normative document) to determine the type of action. Although the time attribute is not always useful. It plays an essential role in drawing up standards. Without considering the duration of a particular operation, creating comprehensive management standards becomes challenging, potentially leading to incomplete management practices.
This is due to the complexity of developing a cost management system for business processes. So far, we have not encountered a single enterprise that has fully realized the possibility of cost analysis of processes. If we turn to the analysis of case tools (software for describing and optimizing business processes). Then they often provide an opportunity to include additional attributes in the process regulations. For example, attached document templates, fixing points of strategic control, etc. You can describe the business process up to the color of the table at which the performer sits. But it’s important to remember that a large number of attributes complicate the project and can be excessive.
The goal
In each project, stakeholders individually define a specific set of attributes, largely influenced by the methodology and the goal.
Methods for assessing processes and defining indicators also vary depending on the approaches used. In some cases, when using standard business processes. The enterprise can start from cases and templates for similar processes and focus on them. In other cases, organizations use a universal typology of indicators for various processes. Such as a matrix of types of indicators. Often, alongside the project of describing and optimizing business processes, they develop a strategic plan and a balanced scorecard. Therefore, the operational metrics can transfer individual indicators from the strategic plan.
A lot of analytical materials are already publish on the use of various notations. It is important to note that the effectiveness of the project. And the effectiveness of the processes do not depend directly on their illustrativeness. It often happens that even without a graphical representation, process management is perfectly already install in the enterprise.
Direction of description and optimization of business processes:
- Bottom-up
- From top to bottom
- Parallel
On this issue, a huge discussion broke out on one professional forum: In which cases it is advisable to describe the processes from the bottom to the top. In which from the top to the bottom. It probably makes sense to write a separate article about this. However, it is important to note that the enterprise typically constructs its goals from top to bottom. Therefore, optimization should go in the same direction. But in practice, there are indeed exceptions to the rule, you can not forget about it.
Thus, we have considered some of the most obvious differences in approaches to process management and its implementation. It is impossible to say with certainty which method is better, much depends on the specific situation. The choice of the methodological aspect is determine by the goals of the project.
For those who are facing a choice today. We recommend first of all to pay attention to the experience of implement the projects. There are a great many arguments “for” or “against” each decision, but there are much fewer examples of successful projects. It remains only to single out among them randomness and regularity.