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23 April 2015

Why should companies be process managed?

This post is also available in: Spanish

Traditionally company management systems were conceived and structured to work using functions.

Functional Management is a rigid hierarchical structure supported by areas, departments, sections, etc. as it is based on the control-analysis-optimization of the activities performed by each employee (or machine): billing, customer visits, the study and approval of proposals, etc., without taking into account the processes required for those performing these activities.

This focus is based on the idea that “if all functions are optimized, company management will in turn be optimized”.

This is not true. Coordination, an important variable, is missing.

Just imagine a football team full of top players but each doing their own thing. Failure!

The information generated can be dealt with in two ways:

  • The structured information (data) generated in the company is managed using tools (management hardware and software) that;
    • on the one hand, ease the optimization of peoples work
    • on the other hand, provide reports and analysis based on the contents of the databases.
  • Equally, the management of non-structured information (documents and / or contents) generated by the company are managed using other tools of the same type (Document Management, ECM, etc.) which are different and independent

Process Management

In reality all companies perform their activities through workflows which are coordinated and aligned with the company’s culture, vision and objectives. These workflows are what we call processes.

Process Management is based on the optimization and continuous improvement, not of the activities or functions, but of the processes.

In process management, when a daily event occurs a process is set in motion, which optimizes the functions and activities of the process and coordinates these activities from beginning to end, aligning them with the company’s objectives, vision and culture.

The processes have:

  1. A beginning. When an action is needed in the day-to-day running of the organization.
  2. A development. In which the activities (called tasks) necessary for its completion are performed. These can be Personal tasks, i.e. tasks executed by internal (employees) or external (customers, suppliers, etc.) people, or system tasks, i.e. tasks executed by a software application, a machine, etc. without any human intervention.
  3. An end. When the action is classed as completed whether it was a success or not.

As company actions are often transversal, each business process starts, develops and ends independent of the areas or departments involved.

Whether the entire process depends on a specific department or involves various departments or customers, suppliers, subcontractors, etc. is irrelevant to the business process management approach.

This approach to managing business processes is relatively new and is changing the way to manage operations in companies and organizations worldwide, allowing much greater effectiveness.

It allows complete control of the information generated in the company, facilitating the uniformity and cohesion of this information, including:

  • Structured information. All of the data that is created, modified or deleted, not only in the processes but also in the company’s applications: ERP, Legacy, etc. (which have been included in the Suite.)
  • Non-structured information. All types of documents that have been created, provided by external parties (customers, suppliers, etc.), archived, consulted, signed or deleted. As well as any digital content.
  • Related information. Management elements (employees, accounts, projects, etc.) connected to the other elements by 1:1, 1:N and N:N relation networks and also to the Processes and documents.
  • Information on Rules. Business Rules, strategies, procedures and guidelines, both internal and mandatory, either textual (interpretable) or mechanical (automatic).
  • Activity information. Information on people, groups and roles involved in the execution of processes and free workflow tasks (minor or unstructured activities) times, usage, current and future expenses and deviations, etc.
  • Control and Analysis information. Control of costs and profitability and direct access to times, views, Business Intelligence, etc., for each process and combination of processes to be analyzed throughout the company.