An Ultimate Guide to Business Process Transformation

Business process transformation can seem like an overwhelming task. With a focus on modern techniques and approaches to process management and transformation, this blog delves into how to be successful in your journey.

What is Business Process Transformation?

Business process transformation is “a significant change or leap in the design, flow, activities or implementation of a process.” Usually, business process transformation focuses on achieving important business goals such as driving up efficiency by becoming digitally focused. Therefore, it is not surprising ‘Digital Transformation’ has been a necessary disruption for many organizations.

Although transformation can be labeled as a ‘big shift’ activity, more and more organizations are taking a ‘big picture, small steps’ approach for their business transformation projects. This focus on setting a big vision and delivering it through incremental steps makes the journey more manageable by team members and allows for learning to be captured and used in successive stages.

You may be wondering, “What is the business transformation process, and why is it important?” Read on for some insight into business process transformation methodology and why it is vital to your business.

Why Should Organizations Care About Business Process Transformation?

Processes are at the heart of every organization’s operations and company culture. Due to changes in the internal or external environment, or a lack of coordinated improvements, a transformation program can focus the organization’s energy on making tangible leaps forward, effectively supporting the organization’s mission and substantial cost reduction.

For example, COVID has caused many organizations to become more adaptable and rethink the way they do business. This dynamic requires companies to think holistically about their business model vs. just doing departmental process improvement projects.

When an organization makes this realization, it is time to embrace a transformation mindset. But how?

How to Develop a Business Transformation Process Model

Start by understanding the context and drivers of the transformation process. Answer questions such as:

• How are external forces – social, regulatory, macroeconomic, etc. – shaping my business?
• What experience do my customers expect? How well am I meeting that expectation?
• Where are the major sources of risk in my business? How are they monitored and mitigated?
• How am I harnessing and expanding the knowledge of our staff?
• What major strategies are having trouble gaining traction?

With an understanding of these drivers, you can begin mapping strategy to execution and identifying areas ripe for automation, simplification, oversight, etc. Using this insight, you can set quantifiable goals and target outcomes and build a transformation map that synchronizes efforts across the organization, track benefits and progress, and identifies additional opportunities for a successful business process transformation.

Transformation involves setting up the team members initiative and approach. To ensure a successful transformation, the core team should engage the key SMEs and stakeholders – people with a real vested interest in getting it right.

Keep the team tight and focused. Create an organizational transformation plan – this is especially important if working across multiple processes or business areas to ensure strong communication channels.

Define the approach for working through the transformation initiatives. Ideally, work in a test-and-learn mode that allows you to focus on small increments of work that can be set-up, delivered and reviewed before the next phase starts. This will help ensure that you do not get bogged down in creating detailed plans that get scrapped, heavily adjusted or stalled due to analysis paralysis or planning perfection.

What is the transformation process in business?

• Capture details of the processes to change – these could be stored in existing documents and systems, or you may need to capture them in a process mapping exercise (read our process mapping blog)
• Analyze the processes to identify the areas to transform – capturing your processes will have provided detailed flows and metrics. This step is all about digging into the details to identify issues and root causes to be addressed. If each initiative requires a business case, this (or the next step) will be the place to create a business case that justifies the need to make specific changes
• Model alternative processes, including adjusted or new flows, events, activities, resources, etc. How far this exercise needs to go will be defined by the outcomes from the analysis. In some instances, the processes will be so broken, or the need will be so new that this exercise will be about designing new processes that feed off the issues in the old processes or cover new areas or ways of working that never existed before
• Simulate, test, and analyze the alternative processes to gauge how they are likely to perform in a live environment. Although live will always trump a simulation, these are very useful testbeds that support Imagineering and stretched thinking, through the ability to model and test any number of different alternatives knowing that risks and issues can be identified earlier and addressed
• Select and implement the best processes, including creating new documentation and work instructions for front line teams through to executable XML for your iBPMS engine.
• Measure impact. Generating instant feedback will help to understand if the change has made a difference and by how much, while also providing insights to support decisions about the next area of focus. For example, if the plan were to incrementally implement 3 changes to the process to achieve a 10% improvement, but the first change achieved a 15% improvement, maybe the others are not required, and the team can look to bring forward changes in other areas.

Then repeat.

It is really true that in modern business practices, ‘big picture’ thinking, coupled with ‘small incremental steps’ has significant value to offer transformation initiatives that reach that big end goal through taking lots of little steps that each deliver incremental value resulting in business growth.