You can think about your business in many different ways. For example, you can examine it with a SWOT analysis – looking at its strengths, weaknesses, opportunities and threats.
Another approach you can take is to use a financial perspective, and go through your books and look at your income and expenditure to work out where the money is coming from (and going).
Business process improvement – the approach I use – looks at your business as a collection of processes.
But what is a process?
A business process is defined as follows. It:
- Has a number of activities that are performed in some order
- Creates something which has value – such as a product for your customer or the invoice you send them
Some business processes are carried out frequently – such as creating and sending out invoices. Others – such as filling out your tax return – less so.
Some business processes are always carried out in exactly the same way each time they occur to create exactly the same outcome. For example, the process a screen printer uses to screen print one of a number of identical T-shirts.
Others processes are less rigid. For example, designing a website, writing a piece of copy or creating a graphic design have a lot more flexibility in the ways they are carried out.
The two common processes
Two common processes that you tend to find in all business are:
- The production process
- The financial process
The production process is the series of tasks through which clients are found and products or services are produced for them. It includes such tasks as:
- Generating leads
- Converting leads into sales
- Obtaining a brief
- Creating the product
- Delivering it to the client
The financial process deals with the flow of money through your business. It has tasks such as:
- Creating a quote
- Keeping track of expenditure
- Sending an invoice
- Receiving payment
- Sending off tax returns and BAS statements
Of course, these process descriptions are very generalised. But they are a good start to understanding how work and money flows through your business.
And as I was saying, business process improvement looks at your business as a collection of processes. And once processes have been identified, it then works out ways to improve them – and in doing so improves your business.
What about you? What processes does your business contain?