PROCESS MANAGEMENT GLOSSARY
What is Process Improvement?
Business Process improvement is the act of aiming to find, analyse and act on methods for improvement in a business.
Process Improvement is the proactive task of identifying, analysing and improving upon existing business processes within an organisation for optimisation and to meet new quotas or standards of quality. It often involves a systematic approach that follows a specific methodology but there are different approaches to be considered. Some examples are benchmarking or lean manufacturing, each of which focuses on different areas of improvement and uses different methods to achieve the best results. Processes can either be modified or complemented with sub-processes or even eliminated for the ultimate goal of improvement.
Methods of Product Improvement:
When it comes to optimising an organisation in an attempt to meet peak performance, there are many methodologies both extensive and narrow. Here are some examples of modern product improvement methodologies:
BPM is a methodology aiming to maximise the results of business processes. BPM is a highly developed strategy with many companies offering software to assist with its procedures and strategies. There are three key types of Business Process Management Software:
- Efficiency Monitors – An Efficiency Monitor accurately tracks where and when bottlenecks appear in your business process. Clarifying, for example, customers pain points and why they do not continue with your transaction process.
- Workflow Software – Workflow Software uses detailed process maps of existing business processes to identify room for improvement. Optimising certain steps, even with small changes, can have massive impacts on your workflow when committed to consistently. When you are able to find and implement many small changes, it can make all the difference. However, workflow software is unable to pinpoint exact issues itself so a keen mind is vital to make the best use of it.
- Enterprise Application Integration Tools – EAI Software is for integrating old and new systems. Aiming to optimise their efficiency and information-gathering.
Kaizen is a Japanese methodology that became popular after World War Two. Its primary goal is to help organisations identify room for improvement at an individual level. To do this Kaizen follows a seven-step cycle:
- Identify an opportunity
- Analyse the process
- Develop an optimal solution
- Implement the solution
- Study the results
- Standardise the solution
- Plan for the future
Kaizen encourages giving employees bigger responsibilities and treating them well. This leads to a happier and more productive working environment.
Toyota created the Lean methodology and have been refining it since Post World War Two. Lean aims to reduce seven types of waste throughout a business:
- Waiting time
Hence the term lean, it’s all about trimming the fat from your organisation to keep it fit and healthy. Today Lean has proven incredibly influential and is practised in both government and commercial, manufacturing and service sectors.
Six Sigma is a methodology originating from Motorola. The methodology aims to complete these objectives:
- Reduce process cycle time
- Decrease pollution
- Reduce costs
- Increase customer satisfaction
- Increase profits
To aid in this effort Motorola established the Sigma rating. The Sigma rating provides a score indicating how frequently a product defects or how much is yielded from the process. With their new methodology and rating in place, Motorola set itself a goal. The goal was a 99.99966% chance to be free of defects (3.4 defective features per million opportunities) in all of their manufacturing processes. Six Sigma is that goal.
TQM is a methodology that emerged in the early 1920s, but it didn’t become popular until the 1980s. TQM is focused not only on product and service quality but also on the means to achieve it. The core principle of TQM was incorporating the knowledge and experience of your workers into documented processes.
According to the United States Navy, there are four key concepts:
- “Quality is defined by customers’ requirements.”
- “Top management has direct responsibility for quality improvement.”
- “Increased quality comes from systematic analysis and improvement of work processes.”
- “Quality improvement is a continuous effort and conducted throughout the organisation.”
However, TQM is in the decline due to Kaizen, Lean & Six Sigma providing much more detailed and refined practices.
Further resources on Process Improvement:
Source: What is Process Improvement in Organisational Development? – Appian