Processes Drive Small Business Success
Best Run Companies Continually Review and Improve Their Processes
Oct 6, 2008
'Ready, fire, aim' might seem to be the wrong order, but it emphasizes that a process must be always open to change. Workable processes are devised and evolve through planning, execution, review of how it worked work during the execution, and modification of the process to strengthen what worked and eliminate what didn't.
This is just as important for a home business or small business as for a major corporation.
Process Planning
Business processes can be so highly structured that they can be built into a computer program. For example, the business software developer Sparx Systems proposes seven components of a process: The process has (1) a goal, (2) specific inputs and (3) specific outputs, it (4) uses resources, (5) has activities performed in some order, (6) may affect more than one organizational unit, and (7) creates value.
Some processes, such as creating invoices or organizing information and files, can be automated, but if the manual processes haven't been worked out well to begin with, the business manager can end up simply automating chaos.
Other activities seem more intuitive and based on individual style, but are nevertheless best performed according to a process.
Sales Process
A business-to-business sales process could have the goal of increasing sales in a particular target market segment. Its inputs would be names of likely companies, and the output a list of people in companies that have shown interest.
Its resources could be a team of people and telephones. The activities would be cold-calling, follow-up emails, visits, finalizing the order and delivering, and follow-up to service the customers.
It would be performed by a sales department, but would affect and be affected by every department involved in performing a service for customers and/or in designing, marketing, producing and delivering products. The created value could be profit or market share.
Process Improvement
The process provides an objective view of how and why a project or enterprise is succeeding or not.
Where sales are falling, for example, the reason can be as much in the process as in the sales person's own performance, or as in product design, market promotion or any other activity involved in the process.
"Only about 15 percent of [problems] can be traced to someone who didn't care or wasn't conscientious enough," writes Jim Clemmer in his book Firing On All Cylinders.
The process can be examined to see what has worked to attract customers and what has turned customers away. The process review helps to pinpoint weaknesses that can be addressed and identify strengths that can be built on and exploited.
An Integrated Process
In a manufacturing situation, where a small business might design a product but have it manufactured wholly or partly by outside firms, the process has to take input from the outside supplier from the start.
In past decades, a design team would figuratively "throw the drawings over the wall" to the manufacturing department with an instruction to "make this." An integrated approach was then developed where the manufacturing and repair teams would be involved in the initial design to make the product efficient for manufacture, assembly and maintenance.
Nowadays, products, particularly in electronics, are likely to be assembled by specialist firms able to offer the economics of scale and bulk purchasing of commodity components. This makes it vital to develop the process with the aid of the outside supplier.
The Value of Process
A main value of a process is that it helps business people to avoid what the Self-Management Group calls the "Talent Trap," which is when a person spends all his or her time doing what he or she is best at doing and enjoys most. There are always tasks people avoid like the plague. A process of who does what when can make sure that those hated tasks (like cold-call selling) get done.
A process is a plan that specifies a required outcome, the steps to achieve the outcome, the people or business units involved, the inputs required, such as information, the intermediate and end results, and the measurable value to be obtained. Although it is a plan, it must not be written in stone, but is more always a 'work in progress.' Without it, no-one will have a clear idea of what to do, when and why.
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