“CREATIVE COLACRACY AT THE NUCLEAR STATION WILL BE INappropriate
What are the business processes
Any business can be roughly divided into projects and processes. Projects are something unique, with a beginning and an end. And processes are what happens regularly, uniformly and indefinitely.
The right business processes are described and digitized. According to one methodology, then everything could be automated later. After all, the ultimate goal is to make the business work like a clock.
Rid people of routine tasks and give them more time for creativity.
Business processes are divided into three types:
Managers: strategy, corporate policy, values, mission.
Operating: sales, marketing, manufacturing, logistics.
Supporting: accounting, IT support, HR.
But in different companies this picture may change. For example, in accounting consulting, the main processes are connected with the work of accountants and the servicing of companies that have concluded agreements with them.
That is, the main processes are those that create value and bring money. If the auxiliary can be transferred to outsourcing, then the main ones always remain inside the company.
How to highlight the main business processes
I approach this from the point of view of P&L – profit and loss statement. You need to understand what processes affect it most – they will be the main ones.
If you go from top to bottom, I’m primarily interested in sales. Indeed, the profitability of the company depends on them.
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People often try to describe all the processes of the company – down to the point and how they deliver it to the office. But you need to start with what affects business results the most. There isn’t enough life to describe everything.
True, in some companies, for example, related to security, there are no compromises. Every detail is important there.
Does everyone need classic business processes
It depends on the industry and the company. Flexible approaches work in many areas, but most companies still need classic business processes.
Creative holacracy at a nuclear power plant is likely to be inappropriate. But the marketing agency is quite suitable.
Description and visualization of business processes works in both approaches. In many companies, only some departments “fly to Mars”, the rest – in the “Stone Age”. Therefore, it is too early for them to start with something active and creative. For starters, it’s important to take basic steps.
When is it better to prescribe business processes
I do not recommend startups immediately deal with the description of processes. It is more important for a business to generate cash flow, make a profit, expand, capture the market. And the routine work of describing business processes can interfere with all this.
At the growth stage, it is better to act reactively:
– there was a problem
– understood how not to do
– prescribed for understanding the procedures
It is worthwhile to proactively engage in business processes when a company reaches a more mature level. Then it is necessary to more seriously analyze the expenditure part and improve the processes until they become better than those of the competitor.
There is an indestructible rule: after improvement, the process should work better. Help save money, earn money or do better work.
How to understand that there are problems in business processes
The number of complaints is growing, or they are not resolved. You can look at the NPS indicator – how much customers can recommend you. This is an indicator – there are more or less problems.
Constant conflicts within departments. When everything is done in tension and it is not clear how each month will end.
Profit and turnover are falling. This is the most important indicator. If you see that financial and operational indicators began to fall, then there are problems with the processes or with the market.
Two common mistakes in modeling business processes.
Do not prioritize. They describe everything in a row, not understanding why it is needed and what benefits it will give. Identify the main processes and start with them.
Do not consider. First you need to look at the numbers, and then draw conclusions. Not all hypotheses are supported by specific data.
The main plus of established business processes
In post-Soviet countries, the “agent problem” is relevant – when the interests of management differ from the interests of the owner. In business, this means that managers can engage in corporate fraud.
Consequently, they can sabotage the implementation of processes in order to maintain manual control. When the processes are automated, transparent and digitalized, the business owner can at any time look at the indicators and ask questions.
And then the management will not be so comfortable deviating from the tasks that are assigned to it.
How often to review business processes
To prevent people from building “Potemkin villages” inside the company, it is necessary to conduct an audit of the most important processes every six months to a year. Less important – less often if a need arises.