Business Process Management (BPM) is a structured approach to providing the products and services that your customers value the most.
In times of uncertainty about future revenues, companies are renewing their focus on reducing costs. Businesses are examining ways to improve operational efficiency by paying more attention to process management and improvement.
When properly implemented BPM defines, improves and manages business processes in order to achieve three outcomes crucial to a performance-based, customer-focussed organisation: > Clarity on strategic direction > Alignment of resources > Increased discipline in routine operations.
The principle is that you must take an analytical view of your company in order to understand what products and services your customer values most. By understanding the key business processes your company uses to meet these client needs, the gap between customer expectations and your ability to perform begins to emerge.
It is about improving the way that organisations create and deliver value to their clients. Ensuring that business processes only incur cost that customers are prepared to pay for.
BPM utilises a number of business methodologies designed to model the current state, instigate change and optimise procedures within an organisation. It enables efficiency and effectiveness as well as a more agile approach, allowing business processes to be defined and tested prior to implementation.
Processes that are inefficient or ineffective in delivering value are clearly identified and targeted for improvement. As an organisation begins to measure its performance and outputs in this context, the activities that require focus reveal themselves.
Purchasing and procurement are as susceptible to inefficiencies as any other function, and equally can reap enormous benefit from process improvements. Whilst direct costs are invariably driven by discernible and quantifiable inputs, indirect overheads are often incurred from less evident foundations.
At ERA we believe that there is a real opportunity to add value to our client’s operations, beyond lowering the unit costs of their indirect goods and services. By paying more attention to process management and improvement, businesses can examine ways to increase operational efficiency and reduce spend.
If we can analyse, model and re-engineer the business processes that drive the procurement activity, we can help create more judicious, timely and efficient buying decisions. Better understanding and control of the demand creation mechanisms within an organisation can have dramatic effects on the efficacy of the supply chain and produce significant cost savings.