Approaches to business process improvement
In modern process management there are two concept approaches to business process improvement:
- Gradual (step by step) approach of business process improvement within the frames of existing organizational structure of management, which requires significant investments or doesn’t require them at all;
- Cardinal approach leading to significant changes in a process and fundamental changes in organizational structure of management.
Both approaches are based on general fundamental process theory and methodology of process management. They are similar in the aspect that both of them are directed to detection of duplication of functions, pinch points, unprofitable centers, quality of certain procedures, the absence of information, the ability of automation and quality management.
However, these approaches have significant differences:
- The first approach is oriented on fragmental processes improvement within the frames of functional and specialized structures of management;
- The second approach is focused on researching of activity processes themselves as complexes of procedures which are valuable for customers.
Business process optimization within the frames of approaches stated above is provided by means of several methods. Researchers define five basic methods of achieving goals of business process optimization:
- Fast analysis solution method (FAST)
- Process benchmarking
- Process redesign
- Process engineering
- Process reengineering
Fast analysis solution method (FAST) is focused on certain process within the frames of one or two days’ discussion of process improvement group with the aim to define ways of business process optimization during the next 90 days. The solution can be accepted or declined by the management.
Process benchmarking is based on comparative analysis of economical processes of a company with a model process of companies providing the same or similar processes but dealing with them better.
Process redesign concentrates its attention and efforts on improvement of existing business processes. Redesign is commonly used for processes which are functioning well at the moment, but need a correction due to changed requirements of customers.
Process engineering, as a method of business process optimization, is commonly used for newly created companies or business processes of new kinds of business in existing companies.
Business process reengineering (BPR) is a fundamental changing and radical reframing of business processes with the aim of achieving significant results in business.