What is a Business Process – Definition, Types, Characteristics, Importance, and Lifecycle

business processes

Business processes (BP) are an integral part of business organizations. Companies or businesses cannot operate properly or succeed without implementing structured processes. Structured processes are the way to keep business operations organized, transparent, and consistent among teams and assist businesses in meeting their goals and objectives.

So, in this article, let’s dig deeper into the subject of business processes and how they help companies and organizations stay in the business game.

What is a Business Process?

What is a Business Process – Definition, Types, Characteristics, Importance, and Lifecycle

A business process can be defined as an activity or a set of activities performed by people or systems in a structured manner to produce a specific outcome that contributes to an organizational goal. The structure of a business process can be complex or simple depending on the factors and elements involved in that process.

The continuous implementation of efficient and streamlined (BP) directly impacts business operations and the organization’s growth. It is why amending (BP) is strategically significant for every business organization.

Characteristics of Business Processes

Some of the key characteristics of an efficient business process are –

  • Business processes are repeatable. Teams can use them multiple times, expecting the same result or outcome.
  • Business processes are flexible. It means that they allow alterations wherever required without affecting operations.
  • Business processes are finite. They have well-established start and end points with exact steps.
  • Business processes are measurable.
  • Business processes add value meaning every task can be finished without wasting manpower, materials, or other resources.

Types of Business Processes

Business processes can be divided into three major groups.

• Operational Processes

Operational processes are the primary processes that directly impact the core business of an organization. These processes represent necessitous business activities that achieve one of the objectives of a company, such as manufacturing or delivery.

Operational processes are critical for an organization to generate revenue and survive in the market. Some examples of operational processes are –

    1. Manufacturing products
    2. Accepting customer orders
    3. Processing payments
    4. Managing bank accounts
    5. Product delivery
  • Supporting Processes
    Supporting processes are the secondary processes that support teams performing operational functions. These are back-office processes that enable employees to do their jobs well.

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Supporting processes do not add direct value to the customers. However, the employees working in the company find value in them.

Examples of supporting processes include –

  1. Accounting
  2. HR management
  • Management Processes
    Management processes consist of high-level managerial functions that measure, monitor, and control business procedures and systems, such as budgeting or governance.

    These processes involve leadership taking certain steps to boost overall business performance, the organization’s work culture, employee morale, etc. Like supporting processes, management processes do not add direct value to the customers but are essential for the organization to function.

    Some examples of management processes include –

    1. Strategic planning to use workforce
    2. Internal communications
    3. Infrastructure management
    4. Budgeting
    5. Governance

When all three types of processes work and complement each other, it massively supports business process management and contributes tremendously to the overall growth and productivity of the organization.

Why are Business Processes important?

Business processes are the lifeline of business organizations, especially large corporations. Here are the reasons why (BP) are important.

  • Business processes are essential for organizations to identify and understand the actual tasks required to meet organizational aims and objectives.
  • Business processes divide tasks into organized and repeatable jobs that employees and teams can easily follow to receive desired outcomes. They also help team members to focus on common objectives while fulfilling their regular duties.
  • Since (BP) involve performing repeatable steps to get consistent outcomes, it is easier for organizations to predict the required resources, thereby decreasing the risk of wastage.
  • Documentation of business processes can help in lowering risk factors and errors.
  • Documentation of business processes can also help in fostering accountability among various actors. Since team members know their jobs and expectations, they understand that they are answerable for their part of the job.
  • Business processes encourage innovation and creativity. It includes stages of reflection, brainstorming, and creative collaborations that assists teams in finding innovative and creative solutions to their shared problems.

Steps of a Business Process Lifecycle

Here are the steps of a business process lifecycle that can be used while defining a new process –

  • Step 1 – Establish goalsThe first step while defining a new business process is to define its purpose and goals. Establishing the reasons behind creating a new process and setting standards to measure its success is crucial. For example, data analytics and metrics can be integrated to measure the results of the process.
  • Plan & Map the process
    After defining the goals, this step consists of developing a broad roadmap for the process. It is crucial to consider different strategies for performing every task. Try to include details for every task, such as what should be done, who should perform it, and the order in which tasks should be performed. It is also beneficial to mention tools to be used and teams responsible for fulfilling each duty.
  • Test the process
    After planning, test the process on a small scale to check its feasibility. It aids in discovering gaps, loopholes, and inefficiencies and making adjustments accordingly. Run the process multiple times to fill gaps and make it the most effective.

Steps of a Business Process Lifecycle

  • Implement the process
    This step consists of implementing the process in a live environment. It involves proper communication and training of all stakeholders.
  • Monitor & Review the process
    Monitor the process and the resources involved to analyze its pattern. Documenting the process history can be helpful. Review the process multiple times to make necessary adjustments to ensure it consistently achieves its goals and objectives.

Conclusion

Every organization must devise its well—designed (BP) to enjoy several benefits that they offer. All actors and stakeholders must be clear about their roles and responsibilities and work with clarity and a vision to achieve their end goals.

Organizations with well-structured (BP) are surely on the path to growth and success.

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