Improving Business Processes Starts with Pinpointing Problems

The first step in improving business processes is identifying problems within your organization. This analysis piece discusses how you can recognize these issues, understand their relative significance, and uncover their cause.

How to recognize problems within your organization

Some companies are well aware of the issues they face. Their customers may be complaining, work morale may be low, and/or tasks are taking too long to perform. Nevertheless, sometimes these issues aren’t immediately obvious. Workers may be so deep into their day-to-day tasks that they lose sight of the bigger picture, including poorly designed business processes.

Employees need to take a step back and consider how the overall business (or their department) is operating. Are clients happy with their service? Are employees satisfied yet challenged? Is new technology making work easier? If these questions are difficult to answer, it may be time to speak with clients and employees about these topics. Ask them to provide their honest opinions.

Understand the relative significance of problems

Taking into account your experiences, making observations, and speaking with others will likely uncover problems within the organization. So might learning more about the company’s finances, regulatory performance, or environmental compliance.

But identifying problems alone isn’t enough. It’s important to determine which issues are most significant in order to focus on resolving them through better workflows. One way to understand the relative significance of a problem is to consider it in the context of your organization’s top business priorities.

Keypoint Intelligence-InfoTrends research shows that many small businesses, for example, are most concerned with staying in business and being profitable. With this in mind, many of these organizations may want to focus on improving business processes that directly impact profits. This could include processes for closing sales, delivering projects on time, and/or holding team conference calls.

Figure 1: Which of the following are business priorities for your organizations in the next three years?

Source: Keypoint Intelligence-InfoTrends primary researchSource: Keypoint Intelligence-InfoTrends primary research

Source: Keypoint Intelligence-InfoTrends primary research

Uncover the cause of problems

Once organizations decide which problems and workflows to address first, they should carefully consider the cause (or causes) of these problems. Some of these causes may be obvious, while others can be better understood through approaches like “root cause” and “cause and effect” analysis.

Root cause analysis is intended to identify the original source of an undesired outcome or problem. Workers can start by stating the problem, and then work backwards with a series of “Why” questions. For example, if a client has decided not to renew a service, you can ask “Why are they not renewing?”

If you determine they are unhappy, you can then ask “Why are they unhappy?” If it’s because they are regularly dissatisfied with the quality of the service, you can ask “Why are they dissatisfied with the quality?” Is it that their expectations are unreasonable, or is the quality truly lacking? If the quality is lacking, further “Why” questioning could reveal that employees are stretched too thin due to poor management. This is the root cause of the issue.

Cause and effect analysis can supplement root cause analysis, especially when it’s presumed there are multiple reasons for a problem. Rather than attempt to identify a root cause of the problem or bottleneck, you detail various causes of a problem—and the effect of each—in a type of diagram called an Ishikawa diagram (also known as a Fishbone diagram).

By illustrating a problem this way, it’s often easier to identify why it is happening. Once causes and effects are diagrammed, causes can be traced back to root causes using the “Whys” technique.

Figure 2: Example of Ishikawa diagram

 Source: https://upload.wikimedia.org/wikipedia/commons/5/52/Fishbone_BadCoffeeExample.jpg

Source: https://upload.wikimedia.org/wikipedia/commons/5/52/Fishbone_BadCoffeeExample.jpg

Conclusion

Companies can’t fix processes if they don’t know which ones are broken; they can’t know which to fix first it they don’t understand the relative significance of the associated problems. They also can’t resolve issues to the best of their ability if they don’t identify their causes. But if they make an effort to gain insight into these topics, they are much better positioned to make positive change in their organization.