What Is Process Improvement?
What is process improvement? What does the ideal process look like? In this blog, we review the four strategic process elements at the basis of good software design.
At FLOvate, we have a clear understanding of what process improvement is, and what it does. But we couldn’t help having a quick Google to see what else came up:
“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.”
Waffle. Means little and provides no insight into practical steps that need to be undertaken.
“Business process improvement (BPI) is a management exercise in which enterprise leaders use various methodologies to analyse their procedures to identify areas where they can improve accuracy, effectiveness and/or efficiency and then redesign those processes to realise the improvements.”
A little better, but again vague. The introduction of another BP term (following BPR, BPO, BPM et al.) adds extra complexity.
“It is a measurement-based approach that focuses on process improvement and variation reduction through the application of Six Sigma improvement projects. The Six Sigma DMAIC (Define, Measure, Analyze, Improve, Control) method is a system for improving existing processes that fall below specifications.”
Getting better; at least this one includes a reference to a proven methodology.
However, all these definitions have a fundamental flaw.
Which is: they don’t explain what has improved about the process. The third one eludes to measurement but doesn’t indicate what to measure.
What Is Process Improvement? Tactical vs Strategic
At a recent FLOvate workshop, we asked attendees to identify all the relevant factors that could constitute ‘process improvement.’
In addition, we wanted them to counter each factor with an opinion of the following:
- Is each factor tactical (used to support strategic factors) or strategic? The list below were the responses, with the designation for each.
|Factor Name||Strategic or Tactical?|
|Reduction of process defects||Tactical – demi-strategic|
|Reduce process cycle time||Tactical – demi-strategic|
|Improve process productivity||Strategic|
|Enable cooperative working||Tactical|
|Enable customer self-service||Tactical|
|App enable the process||Tactical|
|End to end processing||Tactical|
|Enhance customer experience||Strategic|
|Optimise process outcomes||Strategic|
|Increase customer updates||Tactical|
|Keep customer promises||Tactical|
|Reduce failure demand||Tactical|
Defining The Ideal Process
From this we discussed what the ideal process was and came up with the following definition:
An ideal process delights customers, delivers preferred process outcomes, at low cost and is compliant with relevant regulation.
This covers processes at both the specific and generic level. Even better, it gives us four specific, strategic areas to focus on.
Four Strategic Process Elements Of LEAP Software Design
At FLOvate, four strategic process elements are at the basis of our software design. As a result, every improvement to FLOvate’s LEAP platform must do at least one of the following:
- Enhance the customer experience
- Optimise the process outcome/s
- Reduce process execution cost
- Ensure compliance
Reduction of process defects also improves all core strategic dimensions. It is aligned to Six Sigma methodology in that identification of defects and their elimination (or adoption into the main process) is a core principle of that methodology. Process defects are costly to deal with. They make customers unhappy. Defects delay or prevent optimal process outcomes and can cause non compliance.
Reduce process cycle time. This strengthens all the core strategic dimensions, including customer satisfaction. For example: if you can process a customer’s mortgage application more quickly than a competitor, you’re more likely to get their business. In some environments, it is also imperative to meet specific timescales in order to be compliant. Reducing process cycle time can be destructive if taken too far or in isolation but is a key element to improving any process. It is certainly essential to measure.
Improved reporting is entirely tactical. It is used to improve the process, which in itself is not a desired outcome. Reporting may eventually improve all four core strategic dimensions. However, in the first instance it simply adds cost. Over-reporting can add little value and significant cost.
Enabling cooperative working falls within the current process digitisation evolution that many companies are undertaking. Digital cooperative working can improve transparency and real-time communication. Consequently, it can bring dispersed groups together to deliver an optimal process outcome and enhanced customer experience. However, this must be designed with the customer in mind and increase process transparency rather than removing the customer from sight.
LEAP, FLOvate’s low-code workflow platform, does just that. The software allows for ‘supervisors’ and ‘controllers’ to work in harmony, even while remotely. The supervisor controls the core strategic elements during the entire process. Meanwhile, the controller manages delivery of the current stage. This ensures that people know exactly what they are asked to do without cross-over, confusion or duplication of roles/work.
Customer self-service and app enablement are also part of process digitisation. Customer self-service is fantastic, if it is what your customers want, as it improves all four core strategic dimensions. App enablement means making the self service and/or updates accessible via a mobile device (not necessarily via an app). Consequently, these factors, while tactical, can improve strategic success.
End to end processing is important but tactical. Your customer would almost certainly prefer to communicate with one contact throughout the process. Providing this contact with real time access to all information, even when third parties are involved, can significantly optimise process cycle time.
Increased customer updates are important. Why? Because customers hate not knowing where they stand in your process. In fact, a lack of communication is the second most common customer experience failure. The updates need to be meaningful and easy to understand, else they will simply confuse customers and add more cost to your process. Apps are the go-to solution. However, don’t overlook SMS/email – research shows customers often prefer these communication methods.
Keeping promises is essential to keeping customers happy. Once you’ve won your customer’s trust, your execution costs go down. However, even a simple promise such as “I’ll call you back” can easily slip through the net. That’s why LEAP makes it easy to record promises and deliver on them.
Reducing failure demand is complex. End to end digital systems are a good step to dealing with the challenges surrounding this, as is the ability to be proactive. Initiatives to reduce process cycle times also go a long way to reducing the incidence of failure demand.
So: What Is Process Improvement?
As DMAIC (Define, Measure, Analyse, Improve, Control) suggests, we have defined the elements of process improvement. And when faced with a real-life scenario, we would need to decide how we measure each of these facets (which may involve multiple measurements). We would then analyse the data and implement ways of improving each of them. The final part is to implement controls to monitor, measure and improve each element.
Compared to other definitions of process improvement, ours is a little longer than those covered above. However, I’m sure you’ll agree it’s more practical and insightful.