What is process improvement?

Why is process improvement important?

Businesses are in constant motion. Each is made up of hundreds of unique processes – ways of working that support an organization’s operation at every level. From onboarding and offboarding in HR to billing in accounts receivable, every business process has a unique purpose but almost always shares the same goal: be as fast, error-free, and efficient as possible.

Becoming a best-in-class business doesn’t happen by standing still. Organizations that continuously evaluate their work processes are the ones that find better ways of working; their commitment to ongoing improvement is what helps them identify problems, uncover valuable insights, achieve process maturity, and gain the competitive advantage in their industry vertical. In short, embracing process improvement results in optimized processes, which benefits the entire organization.

Benefits of business process improvement

Better results

What everyone wants: better business results. Process improvement enables organizations to see how each workflow performs on a micro and macro level. Not only that, you’ll begin to see where they’re connected – how they interact, how they support each other, and how they support the business’s overall direction and performance. This kind of oversight yields a better understanding of quality, as well as how to replicate and enhance the workfThere’s no shortage of reasons to improve your business processes. After all, what organization wouldn’t like to save time, money, and resources while streamlining workflows, all while delivering better results to their partners and customers?

The “end result” of process improvement (which isn’t really an end at all, since improvement is continuous) is process optimization. After you collaborate to seek feedback to identify opportunities, implement solutions, and test your new workflows, you’ll come to a place where your processes are optimized: as good as they can get. Enjoy the view while you’re there – before long, you’ll be back to tinkering with your workflows to ensure they’re growing and performing well alongside your thriving business.

Let’s look at some of the tangible benefits of business process improvement.

Better results

What everyone wants: better business results. Process improvement enables organizations to see how each workflow performs on a micro and macro level. Not only that, you’ll begin to see where they’re connected – how they interact, how they support each other, and how they support the business’s overall direction and performance. This kind of oversight yields a better understanding of quality, as well as how to replicate and enhance the workflows that create that quality.

Time savings

We’ve talked about better results. What about faster results? As you take a closer look at your processes, places where workflows begin to slow down will become more apparent. You might discover a step that’s unnecessarily complex, or discover an outdated tool. Improving and expediting those processes could be as simple as consolidating a few redundant steps and replacing a piece of old technology.

Identify problem areas

As a methodology, process improvement involves pinpointing problem areas, then taking steps to resolve them. For example, process mapping enables organizations to find bottlenecks in workflows and adjust the factors contributing to the block. This is especially useful for implementing a systematic review of processes across an organization, ensuring no workflow is ever left to malfunction (or simply function less efficiently) for very long.

Customer satisfaction

Customer satisfaction is a natural by-product of process improvement. After all, who doesn’t want better, faster results with fewer problems? When workflows weave together smoothly and efficiently, workers spend less time patching up errors and doubling back to check instructions, and more time creating better experiences for the people and organizations you serve.

Team communication and alignment

A deeper understanding of your business’s processes is a benefit that can be shared with the entire organization. When each department, team, and worker has a clear understanding of their role and responsibilities (as well as how those things relate to the people around them), collaboration and synergy happen naturally. Not only that, if and when issues arise, each worker is equipped to assess and resolve the problem much more quickly and effectively.

Waste reduction

One serious side effect of inefficient processes is waste. Not just where time, money, and worker hours are involved, but products and materials, too. Process improvement is an effective approach to reducing waste in every form, reducing your organization’s environmental impact, improving audit results, and positively impacting your bottom line.

5 steps of process improvement

Now that you’re familiar with the benefits of process improvement, let’s explore the methodology itself. Opinions about which strategy is the most effective vary almost as much as the strategies themselves. However, if you’re approaching the subject of process optimization for the first time, you’ll discover that most strategies follow the same rough outline. We’ve simplified these five steps.

1. Identify and document current processes

To get to your destination, you have to know where you are, first. So, start by taking stock of your current position and audit your organization’s existing processes. Pay close attention to the ones that have the greatest impact on your teams and products – these will be the likeliest candidates for improvement. Be sure to talk not just with leadership, but with individual workers, too; as the people closest to the processes, they’ll likely have insight into what’s working and what could be better.

2. Analyze current processes

Once you’ve gathered a comprehensive list of your processes, it’s time to think about process analytics. Look for steps where your workflows begin to break down: bottlenecks, miscommunication, winding paper trails, and other resource-wasting culprits. After you’ve narrowed down the causes of your processes’ inefficiencies, you can begin analyzing and improving them systematically (and with the methodology of your choosing).

3. Draft and implement improvements

It’s time for the “improvement” part of process improvement. Will you create new processes, or will you adjust the processes you already have? Either way, be sure to implement your changes one at a time and make sure you update the processes you capture in step 1 to reflect the ‘current state’ some process management tools will have a ‘process variation’ function to help make light work of these. These variations will help you understand exactly how one adjustment affects all interrelated workflows. Then, the more your teams collaborate, the more your processes will mature – and you can introduce more adjustments and react accordingly. Be sure to communicate with the teams and personnel these new processes will affect. Process integration works best when everyone involved understands their responsibilities within a workflow.

4. Measure and evaluate results

Once your new or improved processes are up and running, keep a close eye on the results. What you learn now will help you not just improve, but optimize your workflows. Gather data and impressions from each stage of the process, compare it with your goals, and store it somewhere easily accessible so you can measure your growth later on. Remember, process improvement never stops; later, after you’ve worked hard to increase your efficiency, you’ll be pleased to see how far you’ve come, and quantify the return on investment it has yielded.

5. Identify new improvement opportunities

Even if you’re happy with your new and improved processes, it’s best not to get too attached. Chances are, as your organization grows, you’ll need to revisit and repeat this process to keep generating excellent results. This is where the data you gathered in Step 4 will shine: use it to benchmark your processes’ performance over time, determine whether you’re on track to meet your goals, use the value achieved in dollars or time saved to spur on the appetite to identify even more improvement opportunities.

Process improvement methodologies

Process improvement isn’t a one-size-fits-all approach. Earlier, we mentioned that many thought leaders and organizations have their own opinions about which methodology is the most effective. They come from all over the globe, and from different periods in time – Japan in the 80s, America in the 60s, the Netherlands in the 90s. In short, business process improvement methodologies are as vast and varied as the world itself. Let’s take a look at a few of the most well-known.

Kaizen

Kaizen is a Japanese business term that describes activities performed in the pursuit of continuous improvement. Literally interpreted as improvement, the word has a much broader meaning in Japan; in English, we use it to describe process improvement strategies with Japanese influences.

Kaizen is performed daily in workplaces with the goal of empowering workers to detect and eliminate problem points while reducing waste. There are five main types:

• Point kaizen, in which a broken component is spotted and fixed/replaced.
• System kaizen, a strategic approach to resolving system-level errors.
• Line kaizen, which emphasizes free-flowing communication in all directions.
• Plane kaizen, a method of structuring an organization into intuitive value streams.
• Cube kaizen, a state of organizational being often compared to lean methodology.

Because kaizen is a ritual that extends to every area in an organization, it makes continuous improvement an inherent part of daily routines. It involves each worker, on every level, in efforts to improve efficiency and reduce waste, making it a humanizing process improvement methodology.

Total quality management (TQM)

While kaizen emphasizes an organization’s workers, total quality management (TQM) emphasizes customers. In the 80s and 90s, TQM rapidly gained popularity due to its customer-centric approach to process improvement. Though opinions on definitions, methodologies, and best practices vary, TQM proceeds on the idea that quality is defined by customers. It also suggests that improving quality requires buy-in from everyone in the business, especially top management.

PDCA cycle

Plan – do – check – act. The PDCA cycle is a four-step process improvement methodology that builds itself around the concept of iterative design and management. “Iterative” here means the most recent version of a product, service, or workflow – the version that’s tested and studied before creating the next iteration.

• In the plan phase, goals are set, processes are specified, and ways of work are established.
• In the do phase, the objectives created during the plan phase are executed.
• In the check phase, data from the do phase is gathered and analyzed.
• In the act phase, adjustments are made based on findings from the data in the check phase.

PDCA is based on the scientific method and inherently guarantees steady, continuous improvement. Its methods provide for both large-scale and small-scale efficiencies, making it a flexible strategy.

Theory of constraints

They say a chain is no stronger than its weakest link. The theory of constraints, a process improvement and management paradigm, builds its approach on this saying. Here, the weakest link is a constraint: anything that prevents achievement of a goal. (This could be inadequate tools, confused workers, or nonsensical policies.) Theory of constraints posits that increasing flow – that is, working as efficiently as possible around the constraint – increases productivity. The steps are as follows:

• Identify the constraint(s).
• Identify potential exploitations for working around the constraint(s).
• Ensure all processes and efforts support that exploitation.
• Put additional resources into navigating and exploiting the constraint(s).
• If the constraint is broken during the course of the above steps, go back to the first step and start over.

5S

Another Japanese process improvement methodology, 5S is an approach to organization based on five words/concepts/phases. It embraces the concept of visual control, a business practice built on visual communication in the workplace. The five phases of 5S are as follows:

• Seiri (sort), which involves inspecting and sorting all items present in an area, as well as removing those items that do not belong there.
• Seiton (set in order), which aims to expedite workflows by ensuring all necessary items are where they’re needed and expected.
• Seisō (shine), an extensive approach to cleaning with the goal of recognizing issues in an area within 5 seconds of entering it.
• Seiketsu (standardize), or the act of creating a widely agreed- and acted-upon set of practices that emphasize the first three steps.
• Shitsuke (sustain), the ongoing practice, improvement, and maintenance of all the steps listed above.

SIPOC analysis and process mapping

SIPOC (suppliers, inputs, process, outputs and customers) is a process improvement tool that visually maps a process in graph or diagram form. The goal is to visually depict a workflow from beginning to end while highlighting the main components, people, and resources in play, in the correct order. SIPOC originated as a standalone strategy, but over time it has been embraced by other, newer process improvement techniques.

Kanban

Our final example is another Japanese process improvement methodology: kanban, born in the late 1940s in a Toyota factory. (In fact, it’s often called “the Toyota nameplate system.”) Kanban focuses on using materials as efficiently as possible by limiting excess inventory throughout the production process. It does this by placing limits on goods at various production points, identifying and removing inefficiencies, then lowering those limits accordingly.

Examples of business process improvement

Even if they’re not actively using one of the methodologies we’ve discussed above, almost all organizations are engaged in process improvement. They may not even recognize it as such. Any time you streamline a workflow, replace an outdated tool, or automate a manual process, you’re performing process improvement. Examples might include…

• Switching to a paperless document generation and signing software.
• Investing in a contract automation tool to expedite request, signing, and approval.
• Adding an AI-powered customer service chat bot to ease the burden on your support staff.
• Standardizing the new employee onboarding process with centralized documents and presentations.

And much more. There are endless ways to improve your processes because process improvement is neverending.

How Nintex can help with process improvement

In today’s technology-driven world, one of the most popular ways to approach process improvement – any methodology, strategy, or philosophy – is with an end to end process platform. One that includes tools to streamline process mapping (and ongoing management) and tools to automate the workflows is ideal. Why? Because manual, repetitive processes are error-prone, and error-prone processes aren’t efficient. Once you understand your processes, you can unearth automation opportunities, to leverage the automation tools to empower you to streamline your workflows and eliminate room for mistakes, all while taking back time, money, and resources.

Nintex supports businesses like yours with both process management and intelligent automation solutions that make process improvement – well, automatic. We do it with low-code tools, AI-powered insights, and standby support that’s ready to assist when and where you need us. We never stop improving our products because we’re just as committed to continuous improvement.

Discover how we can help drive your digital transformation with our process platform. Schedule a free demo today.