Business Process Improvement 

From "Yes" to Cash

Business process improvement is ultimately about serving your customers better.  It’s less about incremental gains that no one will notice, but substantial, order-of-magnitude improvements. For example, in a single week a Business Process Kaizen team at a TBM banking client slashed the number of steps required to set up a certain type of account by 70 percent, reduced the number of paperwork hand-offs by 75 percent, and reduced the number of delays by 79 percent. As a result they cut the new account lead time from 90 to 49 calendar days. Reducing the customer setup time by almost half pulled in an additional $3.1 million per year in revenue. And that was only the beginning.

There are many areas beyond manufacturing where Lean and Six Sigma techniques can be applied to improve quality and responsiveness, increase efficiency, and reduce costs. They include order entry and order management, accounts receivable, sales support, engineering, warranty claims and customer service centers. Dramatic gains can be achieved anywhere in your organization that executes transactions or follows a routine process. Some of the typical issues that a Lean Sigma approach can solve include: 

  • Flat or declining productivity 
  • Runaway IT costs and work requirements 
  • Overflowing workloads
  • Cash flow and liquidity challenges
  • Escalating or highly variable error rates 
  • Huge backlogs of orders or uncollected invoices
  • Slow response times and customer service complaints.

Unlike a manufacturing process, business processes are often impossible to see. You cannot measure what you cannot see, and you cannot improve what you cannot measure. That’s why the first priority when applying Lean Sigma to business processes is to reveal the flow of information and work, whatever form that work happens to take. 

A Business Process Kaizen is a five-day, action-oriented improvement event conducted at your company, focused on a specific business process or office issue. Led by a TBM Lean Sigma Business Process consultant, Business Process Kaizen teams include representatives from different management levels and every department that touches a process. The first thing the team does is “walk” the process and create a “spaghetti” map, which helps them identify and quickly eliminate the most obvious waste. Participants are often surprised to discover that up to 90% or more of the time it takes to complete a business process consists of wasted time and unnecessary activity, such as defects, extra hand-offs, over-producing, unnecessary processing, excess movement, and waiting.

 

Operational Lead Time

 

The Business Process Kaizen team next creates a detailed process flow map, often filling the walls with notes outlining every activity involved in the process. Critical process data, such as quality and daily volume information, is also collected. At this point they can identify and remove more subtle forms of waste, such as loop backs, unnecessary steps and decision-delay points, and design a new process that will typically yield double-digit quality and efficiency improvements.

 

The Typical Payoff

 

Business process improvement should be a core competency of any lean office and a critical component of your lean transformation. Contact us to discuss how TBM consultants can help you transform your business processes to generate new bottom line efficiencies, increase customer satisfaction and realize a constantly advancing competitive edge.

"We've been amazed at the benefits. We're taking unbelievable amounts of time and effort out of payroll, order entry, and inventory tracking." -Paul Mechler, President, Marvair Company

"On a plant-floor, the process is often right in front of you. But most business processes are a mass of details hidden from view-across multiple locations, offices, and computers-even walking around in the heads of various team members." -Scott Mitchell, Senior Vice President, Business Process Improvement, First Data Corporation

To learn more about Business Process Improvement, check out the following article and videos: