A colleague recently described the following situation to me:
While working with the management team of a small, project-based company, he’s been coaching the new senior project manager. She’s highly qualified and very enthusiastic. So enthusiastic, in fact, that she’s creating a comprehensive project process that will cover all aspects of the business from initial enquiry to post-project debrief and customer follow up. Each step is documented in minute detail with multiple accompanying forms (paper and online) to be completed and/or updated throughout the life of the project. In a larger, more complex organization, her ability to envision and create such a system would be a huge asset. Unfortunately, in this small, agile company, she’s red-taping everyone to death.
Business tools, systems and processes are an essential part of running an effective operation. Only the smallest of organizations can function effectively on an ad-hoc basis. And, over time, even those companies that typically “wing it” eventually recognize, adopt and encode certain practices that produce better results. At some point in the life-cycle of a business, there’s a good chance the systems and processes developed organically over many years will reach the limit of their usefulness and scalability.
In business management, as in HR, we talk a lot about best practices and encourage systemization for greater efficiency, control and measurability. What we often forget to mention is that best practices don’t translate the same way in every environment; for instance, size matters. While it’s true that certain rules and fundamental truths apply across the board, how those rules and truths are acted upon can (and should) vary greatly from one organization to another.
Every company works within a unique set of internal and external parameters: size, maturity, corporate culture, strategy, market, geography, customer needs and wants, regulatory environment, etc. When introducing new systems and processes, each organization must consider its own context and temper the need for control with a good dose of manageability. This is especially true for small companies, where the impact of excess administrative overhead immediately hits the bottom line. For large corporations, complexity and its attendant profit drain can be more insidious, creeping up slowly. Arresting the spread of unessential complexity (and effectively managing the rest) is imperative to remain competitive.
In any organization, using overly complex systems and processes when they’re not called for is a bit like chasing a fly around with a sledgehammer. You might eventually whack the fly, but you’ll likely do a lot of damage in the process (not to mention suffering repetitive strain injury—sledgehammers are heavy!)
As businesses grow, their level of complexity increases. At various point along this trajectory, tools and systems are sought to help manage that complexity. On occasion, the new systems and processes brought in to help manage and control an ever-increasing number of variables make the situation worse by increasing complexity instead of simplifying things. Taking the time to properly identify, map and improve business processes can help avoid this.
Developing (and Improving) Business Processes
Before jumping to solution or simply accepting whatever system or process is offered (even if it’s offered by a well-meaning, highly committed employee), it’s important to undertake some basis business process development.
“A business process is a set of steps or tasks that you and your team use repeatedly to create a product or service, reach a specific goal, or provide value to a customer or supplier. When processes work well, they can significantly improve efficiency, productivity, and customer satisfaction. However, processes that don't work can cause frustration, delays, and financial loss.”
There are a variety of models that define business process development/improvement, but all include the following critical activities:
- Identify the process that needs to be developed or improved.
- Analyze the required or existing process.
- Design or redesign the process for optimal results.
- Communicate the need for change and the proposed solution.
- Gain commitment and support.
- Implement the proposed change.
- Periodically review the process and improve as required.
To be effective, business process development must be:
Inclusive: When following the steps described above, it’s essential to include the people directly involved in the process. Attempting to enforce a new or improved process on employees who’ve had no input seldom works. Nor should it, since the people who are the most conversant with a particular business process are the people expected to follow it.
Cyclical: As businesses grow, needs change. Even when an organization is mature and growth is limited; technology, markets, regulations, and other elements of the business environment continue to change. Systems and processes that seemed optimal when implemented can become inefficient or outdated as a result. That’s why business process development is not a one-time event: it too is a process.
Whether your organization is suffering from growing pains or the impact of increased complexity (or both), the appropriate degree of systemization will help. But this is one situation where “go big or go home” doesn’t necessarily apply. The most important objective when it comes to formalizing business processes is establishing the right balance between:
- control and ease-of-use,
- scalability and manageability, and
- efficiency and effectiveness.
Enthusiasm and commitment are invaluable. Melding that enthusiasm with a clearly defined approach to business process development will allow you to swap the sledgehammer for a fly swatter and better match the solution to the problem.
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 Improving Business Processes: Streamlining tasks to improve efficiency. http://www.mindtools.com/pages/article/improving-business-processes.htm
Laurence Lock Lee. Balancing business process with business practice for organizational advantage. http://www.optimice.com.au/documents/Balancingbusinessprocesswithbusinesspractice.pdf
Managing Complexity in Business. http://bizshifts-trends.com/2013/12/04/managing-complexity-business-mad-wild-complex-world-cause-effect-business-complexity/ 4 Steps for an Effective Business Process Improvement Cycle. http://www.explorance.com/blog/2013/10/8-steps-effective-business-process-improvement-cycle/
Hazel Tiffany. Why Fight Complexity? http://grouppartners.net/blog/2013/02/why-fight-complexity-business/#.VNuAaGjF-_s