The financial losses from COVID-19 are increasing the pressure on companies to seek optimisations. However, many have little or no experience in how to proceed effectively. The key question is: How do I identify inefficient processes?
Dr. Matthias Walter, Senior Manager of consultancy Blue Advisory GmbH and process optimisation expert, responds:
Generally, a process is considered inefficient when the ratio of input to output results in a negative outcome; in other words, when the effort exceeds the returns. The reasons for this often lie on the effort side and are varied. They range from unclear responsibilities in the process flow, unnecessary steps, numerous media disruptions, lack of digitalisation, communication bottlenecks between departments, to poor scheduling of individual process steps – for example, in production. The exact cause of an inefficient process is determined by a process analysis.
Process Analysis: Key Steps to Consider
At its core, you can approach a process analysis in two fundamentally different ways: the ‘traditional’ way or the ‘digital’ way.
Identifying Inefficient Processes the ‘Traditional’ Way
In the traditional approach, you aim to identify weaknesses, improvement potentials, and causes for discrepancies between the target and actual state in individual (sub-)processes. The goal is to increase process quality, avoid errors, save resources, and ultimately reduce costs. The scope of the investigation can include business processes, production or sales processes, as well as communication, decision-making, or management processes.
Finding Inefficient Processes with Digital Tools
The digital approach to uncovering inefficient processes takes advantage of the possibilities of digital transformation. More and more corporate data is being digitally mapped. Processes leave digital traces in systems and databases. These can be read, visualised, and analysed with the help of Process Mining – right down to the level of a single process iteration. This allows business processes to be presented completely objectively as a real-time data-driven picture. Professionals and executives can thus quickly identify inefficient processes, uncover weaknesses, and recognise critical process patterns. However, this method also requires not only the technical prerequisites, such as continuous data availability along the process chain, but also specialist and procedural expertise.
Tips: How to Stay on the Trail of Inefficient Processes
Considering the ever-changing business environment (customer interests, politics, markets, and so on), process analysis is not a one-time task but an ongoing responsibility for corporate and organisational development. Therefore, I recommend regularly challenging your processes in established cycles and reviewing them through various methodologies, such as traditional and digital tools.
Since it’s impossible to constantly analyse all processes, I advise companies to focus where the greatest improvement potentials lie.
Tip: The greatest potential for improvement often lies where paperwork is piling up, processes take too long, or the quality of output doesn’t fully meet the desired standards. It’s worth taking a closer look in these areas.
Consider whether the traditional or digital path of process analysis is right for you. Both have their advantages and disadvantages – we would be happy to advise you.
(Source: B4B-Schwaben)
