Today we're going to be kicking off a series all about process improvement, starting with the basics. What is business process management? If you've ever wondered how to make sense of what goes on underneath the hood of a business, no matter how small or large, how you fit into this and how things can be improved, then this episode is for you.
Hi, my name is Raf. Welcome to Riza, where my mission is to help you go further faster in your career. A big welcome to any of you new to the channel, welcome back to our subscribers, and a quick reminder that I have included time codes in the description box below if you want to jump into a particular chapter.
Today I'm giving you a quick introduction to something called Business Process Management, otherwise known as BPM. What it is, why it's important, and how we use it in business. This is going to set the foundation for many future episodes on various aspects of BPM and process improvement which will be posted in the description box below when they become available.
Now over the years I've become very familiar with the world of processes myself having analysed and improved them during the course of my own career including leading teams of experts to design and improve processes across very large businesses. So I know enough to be able to confidently say that one of the easiest ways to come to grips with how an organisation works or any part of that organisation is to take a look under the hood, and that means taking a look at its processes. And that's because all businesses are made up of core processes that are linked together, that result in things getting done and value being created. Whether it's customer inquiries we're talking about, or loan application approvals, your Uber driver arriving at your door, products being developed, ad campaigns being released, or even the way corporate strategy is run.
Understanding these processes gives us insight into how things work. and how we can make the necessary improvements for better efficiency and effectiveness. Now when you break processes down, you find they are always made up of steps, sometimes hundreds of steps, and each of these steps will have various inputs, actions that are taken, and outputs that result from those actions.
In order to improve business processes comprehensively and manage them effectively, it's necessary to have three aspects working together. Firstly, and most obviously are the processors themselves. You'll need to know how to identify processors and then how to analyze and improve them. And there are multiple proven ways of doing this, such as the methodology known as Lean Six Sigma, which I know fairly well.
Secondly, processors usually hang together using various types of technology, whether that's as simple as your email system or more sophisticated tools such as enterprise software or even customized automation. So, There's a technology aspect to both your current state processes and any proposed future state improvements. And thirdly, and perhaps most importantly, there's the people involved in all of this. It's really, really hard to improve business processes without understanding who is involved, what's required of these people, and actually why these processes exist in the first place. So in a nutshell, this combination of process, technology, and people is really, really hard people to improve business operations using various methods to discover, model, analyse and improve, optimise, manage and automate business processes describes what's commonly known as Business Process Management or as I referred to it earlier BPM.
Just be aware that BPM has become somewhat of an umbrella term, so when many people talk about Business Process Management they could be referring to Business Process Re-engineering, business process improvement, or even continuous process improvement. But you should know that specialized process practitioners, people who do this for a living, when these people refer to BPM, they're actually referring to some very specific BPM frameworks and tools, and not just general process improvement. These specialized BPM frameworks and tools have evolved over time in different ways to solve common needs across industries, so there rarely isn't one BPM standard that everyone needs to know.
But there are definitely global best practices that everyone should be aware of, so stick around because I'll be covering these shortly. So now that we know what BPM is, why is it important? As I mentioned earlier, all businesses are made up of a web of processes. If these processes aren't working well, or not working as well as they should, then a lot of pain is going to be experienced.
Firstly, by the people working in the business. Secondly, by the business itself in terms of its ability to create value as a profitable enterprise. And thirdly, to the customers it serves. Because businesses never stay static, there's a constant need for processes to evolve and adapt. No matter how good these processes may have been to begin with, without contention, continual improvement and effective BPM things can become chaotic and this can happen pretty quickly such as when a business is growing really fast facing a major challenge or shifting the way it operates most businesses tend to have sub optimal processes which are not well understood and challenging to keep optimized and under control and the larger and more complex of business is the greater this challenge is So this is where BPM comes in.
Because it can be applied almost everywhere we find repeatable process steps, it can help us improve productivity and efficiency, specifically by helping us create consistent processes and improve and control the quality of what we do. BPM, by definition, gets into all the nooks and crannies of our processes, so it allows us to get ongoing visibility into how those processes are performing. And because of the process standardization, and...
the quality improvement, the repeatability, the control and visibility that BPM allows us, well, it also allows us to improve risk and enforce compliance. With BPM we can enable real-time risk evaluation, reporting and audits because every action and outcome is recorded. We can also ensure that regulatory deadlines are adhered to, for example when issuing reports, payments or breaches of conduct. BPM also provides smart methods and proven frameworks for for effective business transformations and helps us make sure that we're able to track our benefits accurately and externally it can help us offer more value as a business to attract more customers and improve service so that we retain those customers such as through making more self-service options available online resolving complaints faster as well as real-time tracking of applications inquiries orders and so on on demand services for example have been extremely successful in disrupting whole sectors through building and scaling their businesses using BPM.
Just think about, only a few years ago, how you would book your travel, book an appointment with your doctor, watch a movie. How you used to order a cab or buy a book, even grab a burger. And now think through all of the convenient on-demand options that are available to you today and how the old traditional businesses were disrupted so effortlessly. BPM has played a major role in this. And if you look internally within businesses, BPM is often used to promote collaboration through a common understanding of processes, as well as through optimizing access to data, file sharing, and task management.
And in case that's not enough for you, once you consider the benefits I've already covered and step back to consider the broader effects on a business, you can now start to see that how having BPM in place improves profitability through reducing those costs and increasing revenue. It makes businesses more agile by being able to respond to change dynamically, reacting quickly to emerging issues and opportunities because we have real-time information and faster response. And ultimately, it gives these businesses a competitive edge in a crowded global marketplace.
So, hopefully you can start to get a sense of just how powerful business process management can be and how many facets of business it touches. Now, if you're even mildly curious, You might be wondering, how? How does BPM do all of this?
Well, as promised earlier, here are some of the most widely adopted BPM methods in use across industries globally. These are workflow management by understanding and designing effective sequences of steps across processes to connect those three areas we spoke about earlier. A good example here is when a new employee is hired.
Without effective workflow management, this process can be a total disaster for both the company and the new starter. Ever had this happen to you? Well, using this example, you can also see how analysis tools to generate metrics, KPIs and reports could be really helpful in assessing the quality and efficiency of the hiring process.
But analysis tools can also be used externally for customers to access the information they need, such as when comparing electricity providers, trading on the stock market, or even checking the weather. And going back to our employee example again, you can see how effective business process management also requires integrations, which links the data held in separate places, sometimes many different places, and makes it available for use in this case from customer relationship management software to human resources portals and even the company's intranet for various parties including HR, IT, finance, the business area, and the employee themselves. BPM also includes more advanced methods such as Robotic Process Automation or RPA, which simulates the processes performed by people.
Process automation requires a deep understanding of those processes and then coding each little step in carefully orchestrated sequences to represent the process. what us humans do. And here we use various types of software to help us, from simple form generators for collecting data in a structured way, to business rules engines which automate process steps according to whatever rules and conditions we would like to specify.
And we can even get into more advanced areas of BPM such as artificial intelligence or AI engines that start to mimic human intelligence through making predictions based on algorithms and data.... If you've ever looked through your photos on your computer or your smartphone and wondered how the application is able to recognise your face across thousands of images, suggesting that you tag them or sort them in various ways, well that's an example of artificial intelligence within BPM in action. And lastly, BPM also uses collaboration tools quite widely, such as task management software, communication tools like instant messaging, and organisational tools to share and consume information. All of these methods are typical hallmarks of business process management, especially when you see many of them being used together in combination. And they illustrate what I mentioned at the outset about process, technology and people working together to improve business operations.
So, hopefully I've demystified BPM just a little bit for you through this very high level overview. As you probably realise, it is a broad topic area and it can get pretty complex. Regardless of where you are in your particular BPM journey, there will be future episodes on this channel going deeper into various individual aspects of business improvement and process improvement, focusing on the ones that I think you'll be able to apply in a very practical way to help you go further faster at work in almost any role.
Look out for the next episode where I show you how to use a very practical and powerful tool for understanding processes at a high level, which we call SIPOC. As always, if you have any questions or observations, let me know in the comments below, hit the like button if you enjoyed this video and while you're there, why not subscribe and hit that notification bell to make sure you don't miss out on any future episodes. And don't forget to share this with a friend or colleague.
Till next time, keep rising!