The Why, What and How tos of measuring BPM impact

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Improvement is indispensable for any product, service or infrastructure. While most businesses understand that, how often are improvement measures undertaken?

 Say you run a business. You have realized that your business processes can perform better with a few adjustments here and there. In lieu of that, you have implemented certain business process management measures into your operations; this could be in the form of operational infrastructure upgrades, digital tools or niche high-value-adds. In order to gain insight into existing processes and workflows, business process management software often applies a method called process mining. Data-driven solutions enable supervisors to identify and fix process vulnerabilities. But does the scope for improvement end there?

Software alone cannot guarantee success. One of the most common factors for failed BPM implementation is a viewing BPM as a one-time measure. Failure of which can lead to heavy costs. Thus, for an organization to actually benefit from BPM, continually monitoring its impact is essential. In this blog, we will take you through the steps to analyzing the impact of BPM, and how it can be used to further improvements in your business processes.

 Know more: Unleashing the Analytics Revolution in BPM: Data-Driven Decision Making Takes Center Stage

How can impact analysis be used in business process management?

Although a standard procedure in software development, impact analysis can be effectively applied to measure the results of implementing BPM in a business. By definition, impact analysis refers to the identification of potential implications of a decision or change to help business leaders make informed decisions. As a result, companies can also consider modifications that may improve the decision-making process.

In effect, impact analysis could very well be considered the first step to implementing BPM – analyzing existing processes and identifying ways to optimize them. What happens next?

Three metrics to track process improvement impact

Once the potential impact is analyzed and the necessary BPM measures are put in place, it is time to calculate the actual results of these measures. However, process improvement outcomes can often go misdiagnosed without an objective tracking system. We have come up with three metrics that can be used to determine if your BPM has made the desired impact on your business.

  1. Plan, Do, Check, Act: A popular process improvement model, this method adopts a four-step approach:

    – Define the challenges (Plan): The first step is to define the challenges your processes are facing and deliberate on the possible causes. Based on this understanding, an appropriate solution can be hypothesized. In this scenario, the solution is a BPM measure. Here, data from the pre-solution phase can be gathered in order to draw future comparisons.
    – Implement and analyze (Do): Next, apply the solution and collect the data necessary to evaluate its effectiveness. For example, if the goal is to improve customer satisfaction, the metrics could be customer satisfaction scores, customer retention rates, and customer complaints. The data could be collected through surveys, interviews, focus groups, or by analyzing data sources such as customer feedback, process performance data, and financial data.
    – Analyze the data (Check): Once data has been collected, it needs to be analyzed to identify trends, patterns, and insights. The analysis should focus on checking whether the hypothesis is deemed right. This can be done using the before and after data.
    – Perform the results (Act): After reviewing the results from the Check phase, you decide whether to permanently implement the new process. In the event that this does not happen, the cycle will restart from phase one – plan.

  2. ROI: A more straightforward method is to measure the financial impact of process improvement initiatives. This can be calculated by subtracting the implementation cost from the net return on improvement. A percentage can then be derived. The goal is to have a positive percentage number. However, this gives a simplistic perspective rather than a holistic one.

  3. Setting KPIs: Every business has distinct needs and objectives. Therefore, businesses must have a clear understanding of these goals, which could be long-term or short-term goals, as well as how they intend to achieve them.

 

An easy way to chart out business objectives is by conducting a needs analysis and identifying the key performance indicators (KPIs). It is possible to determine whether a process improvement initiative has succeeded or failed based on how these KPIs are met.  

Know more: Unearthing Hidden Treasures: The Power and Importance of Process Mining in the BPM Industry

The way forward: continuous improvement and reaping benefits

The data from analyzing the impact of BPM can be used in various ways to improve the organization’s operations and processes. Some of the ways in which the data can be utilized are as follows:

  1. Prioritize initiatives: The data can help organizations prioritize their BPM initiatives based on the impact they have on the organization. For instance, if the analysis shows that customer satisfaction has not improved, the organization can prioritize initiatives that focus on improving customer satisfaction.

  2. Identify process improvement opportunities: The data can help organizations identify areas where they need to improve their processes. For instance, if the analysis shows that there are bottlenecks in the order processing process, the organization can take corrective action to eliminate them.

  3. Monitor performance: The data can be used to monitor the performance of the organization and track progress towards achieving its goals. For instance, if the goal is to reduce costs, the organization can monitor its expenses and track the progress towards achieving the cost reduction target.

  4. Demonstrate value: The data can be used to demonstrate the value of BPM initiatives to stakeholders. For instance, if the analysis shows that a BPM initiative has resulted in significant cost savings, the organization can use the data to demonstrate the value of the initiative to its stakeholders, such as investors, customers, and employees. By showcasing the measurable impact of BPM initiatives, organizations can gain support for further investments in BPM and other process improvement initiatives.

 

 Know more: Talent Development and Retention in the BPM Industry: Nurturing the Next Generation of Leaders

Conclusion

In conclusion, BPM is not just a buzzword; it is a way to improve business operations and processes. It is important for organizations to recognize the value of BPM and invest in it to reap its benefits. BPM initiatives may require a significant investment of time and resources, but the rewards can be substantial. Therefore, organizations should prioritize BPM and make it a part of their strategic planning process.

However, constant efforts to measure the impact of BPM are required to determine whether the initiatives are delivering the expected results. By continuously identifying areas of improvement, organizations can achieve their business objectives and stay ahead of the competition.

Frequently Asked Questions

EOSGlobe is a leading business process management organisation that strives to provide high quality services focusing on exceptional customer experience and digital technological innovation. EOSGlobe is committed to becoming a value-driven organisation with the highest standard of services to their customers. With an exceptional team having rich domain expertise and robust digital solutions, helps businesses to transform their futuristic goals into reality. It aims for strategic partnerships with its global clientele to build a culture of innovation and business transformation at cost effective rates and with more productivity.
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Our mission is simple – to digitally transform business processes, optimise cost, and drive greater returns.

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