Join Eddie Davila for an in-depth discussion in this video Understanding business processes, part of Business Foundations.
- How does a company get stuff done? Whether you're paying at the register, getting a refund, placing an order from a supplier or perhaps, you're applying for a loan from a bank. Good companies have documented processes that allow them to perform repetitive processes effectively and efficiently. Business processes are vital to any growing company. They allow for consistent, high quality output. By documenting business processes, companies can expand quickly. They can essentially become cut and paste companies: opening up new facilities by just repeating what is done at other facilities.
So, what defines a good business process? A good business process must have good intentions: good corporate goals and good outputs for customers. A good business process must deliver reproducible results: no matter which locations customer go to, they should have a consistently excellent customer experience. Finally, a good business process must be measurable and manageable. In other words, a manager must be able to see through data if the process is doing well or if it's struggling.
And if the numbers are poor, a good manager should be able to guide employees to improve their results. So let's take a business process we are likely familiar with: placing an order for goods that will be delivered to our home. A process should have good intentions. What should be the company's intentions? First, take the order information accurately; items, names, address, payment information. Also, the process should be fast and easy for the customer.
And perhaps, it should be a low cost process for our company to perform. The process we create should be reproducible. So if we plan on taking orders over the phone, we need to create a process that is easy for our operator to carry out. Or perhaps, we are Amazon. In which case, we have the customer do most of the work for us in an online form. But remember, we need the process to be accurate, complete and it needs to not scare away the customer.
In either case, though, we are likely using an online form that will be filled out by our operator or a customer. This helps us with the third consideration in developing a good process: this process needs to be measurable and manageable. By having an online form capture the data, we can measure the speed and accuracy of the process. We can track the types of mistakes made and with this, and lots of other data, our managers can use simple and advanced metrics to figure out how to make this process even better.
What types of business processes do you have at your company? In other words, what are the things that are done over and over again? Now consider each process on its own. Does it have good intentions? In other words, does it consider all of the stakeholders? If this is a good experience, is this experience reproducible? Is it good every time, for everyone? Finally, what type of data is being captured? Can managers easily access the data to manage and improve the process for customers and employees in the future? Are there opportunities to save time and money? Can we improve quality? Business processes may seem small and rather insignificant, but the world's global organizations understand that business processes are the building blocks of any great organization.
As your company looks to grow and expand, don't overlook the value of a great business process.
He also reviews the basics of the people side of business: managing employees and developing customer relationships. Last, he covers the financial and information management aspects of business and provides a basic explanation of economics, so that you can understand the relationship of your business to the bigger picture.
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- Understanding business goals, stakeholders, and resources
- Developing a product or service
- Selling a product or service
- Raising capital
- Managing employees
- Managing customer data
- Understanding finances
- Managing resources
- Understanding economics