How Process Definition can add more value to your Business
This second part of our Business Process Management series is all about Process Definition. Without knowing what the processes of a business are, you cannot do Process Documentation or Process Improvement. You cannot manage the unknown. If you are at that stage, you need to start with the beginning – identifying and defining your processes. We call this stage "Process Definition".
What Is Process Definition?
What does this actually mean? One simple definition is:
"Process Definition is a stage identifying every single step required to achieve a particular output, based on specific input, resources available and requirements".
This sounds quite straight-forward, unfortunately still many businesses fail at this stage. The main reasons are often a lack of time & resources. Some organisations don’t think that processes are relevant for them and just ignore it. A company (not even a start-up) once told me that processes are not needed as they have an entrepreneurial mindset. I was unable to respond to that statement – it was one of the few times in my life when I was absolutely speechless!!!!
Why Is Process Defintion Important?
Why do I think this response was wrong – and why time and resources are not good reasons to avoid process definition at all?
Poor customer and employee experience
Every organisation has tasks that are followed on a daily basis by individuals and teams. In some instances, there are hundreds and thousands of tasks to produce goods or deliver services. Some might be basic; others are critical for a good customer experience.
Now imagine, no one knows what the exact steps are. They are completed by assumptions rather than knowledge. Training is based on the knowledge of trainers and their perception of best practise. Continuous issues ignored. These can lead to errors or delays. Having no defined tasks can impact the productivity and employee experience, which might result in higher costs or high staff turnover.
In addition, a lack of process definition can lead to different outcomes for the same tasks. Customers certainly don’t appreciate receiving inconsistent deliveries, it’s not a great customer experience. The result can be losing customers immediately or in the long term.
No Process Improvement or Automation
Another issue of having no defined processes appears when organisations consider process improvement or automations. How can you improve something you don’t really know? Very simple - without defined processes it is nearly impossible to improve them.
I encountered this issue during one ERP project I managed: The project experienced some extended delays caused by one common factor – uncertainty about some internal processes. How can a system replace and improve manual tasks if no one knows exactly what the tasks are? Thankfully, we managed to fix it. Other businesses were not that lucky. I know businesses whose ERP projects with large budget failed because no one looked at the initial processes. This is why process definition is critical for the success of IT and transformation projects.
When Should You Handle Process Definition?
Obviously, the sooner you start the better. Here are some reasons why:
This applies especially to start-ups. While time and other resources are limited, delaying this step might cost even more and becomes more complex.
There are other events that might require process definition:
Regulation
In recent years, many industries faced increased regulations by governments. Some regulations require clearly defined processes or cause heavy fines for non-compliance. So, this is not voluntary – you must do it. Those who had defined processes before regulations came in place found it much easier to fulfil the new requirements. For others, the implementation was more complex.
Failed Audit
Some organisations might require a failure to react – like an audit. In some industries, failing an audit can lead to heavy fines. For larger organisations, it can lead to the involvement of the Headquarter or regional office. During a review, they often consider the lack of defined processes as key reason for the failure.
Losing customers
While some of the other events are external, internal issues such as inconsistent or faulty delivery can cause losing customers. If your organisation is experiencing this, you should define your processes immediately to minimize the impact.
How To Do Process Definition?
There are several steps in defining processes to ensure it’s done correctly. You don’t need to follow all of them – but by doing so you get more benefits.
Step 1 – High-level Process Flow
Companies can have hundreds of processes that requires definition – and there are always interdependencies. To ensure you cover all process you should focus on individual departments and create high-level process flows for each area. This end-to-end approach will help identifying all relevant processes and put them in the correct order.
Step 2 – Identify and define Processes
For this step you must run a session for either each process or interconnected processes. Do not try to handle all processes of a department in one session with one single team. Besides the subject for each session the set-up of teams for each session is also critical. Best practice for these teams is having a facilitator and Subject Matter Experts (SMEs) covering all areas affected by the processes. While facilitators help with consistency, the experience and knowledge of SMEs will ensure the correct definition of all steps. Make sure you involve all teams impacted by a defined process during the sessions.
The actual session should cover the following details of the processes:
The more details you provide, the better the process definition. It prevents uncertainty for anyone involved in the process.
It is important that you consider the two key risks for Process Defition: Assumptions and Terminology.
The most critical risk is assumptions. There is no space for assumptions in processes. People don’t have the same thought about processes and will assume different things. This can create serious issues at a later stage. Deal with certainties and facts only – leave assumptions out.
Another trap in processes is terminology. We all know the feeling of hearing new terms and acronyms in meetings without knowing them. Terminology can lead to confusion - or worse, assumptions. Every terminology that is unique to an industry or area should be highlighted and defined as part of this step.
Step 3 – Include Exception Process
During any process definition session, the easiest part is defining the straight path from input to output. The so-called “Happy Path” covers every successful step from start to finish. However, as you know - this doesn’t always happen, and things can go wrong at any time. Hence, this should be covered during the process definition. The perfect question for every single step is actually “What happens if….?”. This will help identify the so-called “Exception Process”, whereby additional steps are required to deliver a successful output. Having a defined process with a Happy Path and Exception Path helps staffs follow the correct processes for any scenario. This will deliver a better customer experience and employee experience, as the risk of uncertainty is reduced to a minimum. Obviously, you can’t identify every scenario, but you can cover the most obvious and those causing the biggest issue.
There is much more about Process Definition but by following this guideline, you will successfully deliver the first stage of Business Process Management.
If you need help at any time with your Process Definition, we are here to assist. CONTACT US to find out how we can support you in this stage, from an initial review, training to fully facilitate process definition.
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