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What are Metrics and Why are they Important?
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Payment Mechanisms in International Trade
Setting up International Trade Mechanisms involves inter disciplinary processes including Finance, Logistics, Taxation and Supply Chain disciplines. Every Business Manager would need to know the nuances of the trade even though he may or may not be involved in the micro management of the processes. Any Import or Export entails commercial transaction and payment. When […]
ERISA Act – The Government Mandated Stock Market Crash
America is sitting on a demographic time bomb. Their economy boomed thanks to the “baby boomers” that brought prosperity to the nation. However, they have got old and now is the time for them to retire and be replaced by a younger generation. The problem is that the number of people retiring is far more […]
Business Process Improvement exercise is undertaken by organizations to improve their operational efficiencies, to remove redundant processes, eliminate wastage as well as to adapt to customer expectations and thus augments its operations to meet with the expectations.
BPI programs aim to bring about permanent changes to the processes through a sustained and planned implementation program.
Business operations consist of a maze of processes that are intertwined, overlap ping, extensions and combinations of functions and departments. All departments and functions have got to work in tandem with seamless integration to ensure that the business objectives are met within the stipulated time frame and with utmost efficiency.
Business Process Improvement can be successful only when it is spearheaded by the management and the concerned business unit heads. The management forms an Executive Implementation Team which in turn chooses the important and business critical process which needs to be addressed in the BPI program besides of course drawing up, approving and enabling budgetary sanctions and resource allocations required for the program. Thus the management becomes the sponsor of the BPI program and owns the responsibility of communicating the same all through the organization.
In the second stage, the EIT appoints a BPI Champion or a Process Owner is selected for the chosen process. Along with the Process Owner, a Process Improvement Team is also formed. This team consists of the Departmental Managers and facilitators of the process. The PIT team headed by the Process Owner undergoes BPI training to equip themselves with the concept, the methodology and the tools to be used for the BPI program.
Once the initial training has been completed, the next step that follows is to build a initial PIT Plan. The PIT plan consists of:
As explained above, any business operations will consist of several business processes. It is important to identify and determine that particular business process that is to be taken up for improvement. Each process will need to be identified with the boundaries explaining at which point the process begins and the point at which the process ends. Besides the process will also involve inputs and outputs to several other processes, departments or functions too. These will need to be identified in detail and the clear boundaries of the process on hand will need to be identified.
Example Fig. 1: Parts Management Warehousing Process
Example Fig.2: Part Picking Process in the Warehouse
Take the case of the above example. The Fig. 1 represents an overview of the Warehousing Process. The second Fig. 2 shows a detailed process flow of one of the activities that forms a part of the Warehousing Process. (Highlighted in Fig.1). As such in a proposed BPI program, several such processes can be taken up for improvement if they are found to yield efficiencies and make business impact.
In each of the processes identified, the Process owner draws up the starting point and ending point of the process that is being taken up for improvement and walks through the process with the process leaders in detail.
The PIT plan drawn up will contain information on the selected process, the boundaries, the start time and end time of the project, the details of process owners, the resources required and the action plan for the process improvement.
The initial PIT plan serves as a guide post for the entire program. As the PIT team gets involved in review of the process in detail, the operating assumptions and the entire process itself can undergo changes in line with the customer expectations or the set goals.
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