This sounds reasonable at first, but it fails to take into account any ripple effects that might spread from this individual decision. Let’s say, for instance, that one supplier relied on a legacy order processing system to interface with the company’s procurement system. Let’s also say that when the team reengineered the approval process they did so in a way that made it incompatible with this legacy application. And finally, let’s say that this particular supplier accounted for 40% of all purchases of non-production goods last year.
Clearly, this should compel the process analysts to revisit their decision. But without an impact analysis they wouldn’t find out about the ripple effects until too late.
The primary responsibility for process optimization falls upon process analysts and domain experts who possess detailed and accurate knowledge of how processes work. In some cases, companies will appoint process owners that have overall responsibility for improving particular processes. The discretion of these process owners spans multiple business functions, freeing them from the political and process restrictions generally imposed by organizational silos. Together, they model as-is and to-be states of the company’s process environment to discover the best way to make business goals reality.
The principal drivers of process optimization are the goals and objectives inherited from the business model. These keep teams focused on making changes that are in step with espoused management vision and concrete corporate needs. In turn, the results of process optimization drive the set of decisions made during technology automation.
By approaching process optimization in this way, companies avoid the costly disconnects that can occur when handoffs between business, process, and technology are not structured and managed effectively.
Faisal Hoque is the chairman and CEO of BTM Corporation. BTM innovates new business models and enhances financial performance by converging business and technology with its unique products and intellectual property (IP).