Process Improvement and Its Role in Organizations | Free Essay Example

Process Improvement and Its Role in Organizations

Words: 2014
Topic: Business & Economics
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Introduction

Process improvement (PI) is most popular among researchers and practitioners nowadays (Veldman et al. 2014), and in this paper, an attempt at explaining this phenomenon is made. In particular, process management and its types, including PI, are defined, and PI is described in detail. The paper includes a discussion of the aims and outcomes of PI, the means of ensuring its success, and the attitude of various types of businesses to PI. The paper allows demonstrating and illustrating the factors that cause the popularity of PI, and it also indicates that PI is capable of improving the performance and sustainability of any type of organization, including public, private, and non-profit ones, when it is implemented appropriately.

Process Management

Process management is an important area of research and practice in business (Brocke et al. 2014; Veldman et al. 2014). A key goal of process management is the enhancement of processes, which is carried out through assessment, control, and organization. A process can be defined as a series or a chain of activities that comprise a business (Islam & Ahmed 2012). As a result, an organization is defined by processes, and one might even suggest that an organization is a process, which embraces multiple subprocesses. Thus, the improvement of these subprocesses is bound to improve the organization at large.

The processes that tend to add value are typically united into value chains (Librelato et al. 2014); those that are simply necessary for the functioning of the company but hardly add value are support processes (Nicholds & Mo 2016). As the term of process management, PI refers to small-scale changes in stable processes. A large-scale problem solution presupposes process redesign (Haddad et al., 2016), and process re-engineering occurs on the largest scale and is aimed at modifying significant issues (Rinaldi, Montanari & Bottani, 2015). PI, as a result, is the least impactful form of change processes, but due to this feature, it is more likely to be often implemented. The reasons for the implementation of PI are described in the following section.

Process Improvement and Its Value for Organizations

Aims and Outcomes of Process Improvement

The major goals of PI include efficiency (managing to restrict the use of resources to the level expected) and effectiveness (the achievement of the planned output) along with the robustness of resulting processes (Rinaldi, Montanari & Bottani, 2015; Sanders-Jones & Linderman 2014). Moreover, PI is known to be able to achieve these outcomes. There exists sufficient evidence to the fact that PI can result in greater efficiency and reduce the number of resources that are used by a particular process (Andritsos & Tang 2014; Rinaldi, Montanari & Bottani, 2015).

Also, the evidence to PI resulting in effectiveness can be illustrated by the studies of Haddad et al. (2016) and Islam and Ahmed (2012). The outcomes of these major PI results include risk control improvement, quality and agility enhancement, cost reduction, and the ability continuously evolve, which eventually leads to better performance and sustainability (Haddad et al., 2016; Islam & Ahmed 2012; Nicholds & Mo 2016; Pádua & Jabbour 2015). Torres and Sidorova (2015) also demonstrate that an improved process can positively affect employee motivation, especially if the improvement is aimed at simplifying an unnecessarily complex process.

The key outcomes of PI are likely to attract businesses to it. Apart from that, some external factors can be noted. Competition is a key driving force for many business projects, and it can also be used as a justification of PI (Islam & Ahmed 2012; Sanders-Jones & Linderman 2014). The threat of competition is present in most markets, even those controlled by oligopolies, and PI has been proven to gain and secure competitive advantages and achieve strategic goals of companies. Islam and Ahmed (2012), as well as Nicholds and Mo (2016), point out that staying competitive is a survival matter for modern companies.

Tanrısever, Erzurumlu, and Joglekar (2012) also highlight the fact that it is especially true for debt-financed startups, which is why PI is likely to appeal to them. Apart from that, the authors mention that PI can be used to avoid going bankrupt, and the authors state that the PI has also been shown to succeed in reducing the likelihood of such an outcome. However, the authors acknowledge the fact that PI requires an initial investment, which can be difficult to allocate for a startup and which may reduce PI appeal. Another difficulty in PI implementation is the fact that a successful PI depends on multiple factors that are going to be considered in the following section.

Process Improvement Success

Not every PI project is successful (Nicholds & Mo 2016), which is why not every organization can enjoy the positive outcomes of PI. Nowadays, a bulk of literature makes attempts to discover the features that can guarantee positive PI results (Brocke et al. 2014; Nicholds & Mo 2016). In this part of the paper, several of these suggestions will be mentioned.

One of the modern trends in process management is system thinking, which requires considering processes in their interactions, hierarchies, and interdependencies (Brocke et al. 2014). It is a popular approach to process change nowadays, and Brocke et al. (2014) use the word “holism” for it. This term is different from the word “systemic” because it regards a company as a whole, which appears to promote the understanding of the interrelation of its elements. At the same time, it shifts the attention from the elements to the system in its entirety, which, given the fact that a common mistake consists of concentrating on elements and having a narrow focus, also seems to be beneficial. Brocke et al. (2014) highlight the fact that sound process management is a holistic activity, which makes it one of the recommendations in PI implementation.

Brocke et al. (2014) also point out that every PI and business management is organization-specific and needs to take into account the features and context of a particular organization. For example, as shown by Boyer, Gardner, and Schweikhart (2012), hospitals have been assimilating PI tools and strategies from other industries, including manufacturing and service. However, the authors highlight the fact that the success of these assimilations remains varied. In other words, paying sufficient attention to the specifics of an organization appears to be required for PI success, and it is the second recommendation for PI projects.

Rinaldi, Montanari, and Bottani (2015) also mention those modern technologies are a strong facilitator for PI and process management in general. Brocke et al. (2014) point out that using every opportunity to employ technology for PI is a key principle of sound process management and defines it as the principle of “technology appropriation” (p. 533), which makes it the third PI recommendation.

Employee participation and engagement are of supreme importance to the success of a PI project (Lam, O’Donnell & Robertson 2015), and it is the fourth recommendation. Brocke et al. (2014) also expand it to stakeholder engagement, which corresponds to the holistic attitude to PI that the authors promote. Apart from that, other features of successful business management and PI include being continuous and ongoing, being incorporated into the structure of the organization as well as its strategy, and staying simple, economical, and resource-preserving (Brocke et al. 2014; Pádua & Jabbour 2015).

To sum up, the aspects that should be considered for a properly conducted PI are numerous and complex. They affect the ability of the company to enjoy the beneficial outcomes of a PI, but the complexity of these considerations does not deter different types of organizations from striving to carry out PI. More than that, the attention that PI attracts to these aspects seems to be able to have an indirect positive impact on a company’s performance, for example, through the implementation of modern technologies, strategy improvement, the introduction of systemic thinking, and employee engagement. As a result, the positive direct effects of PI appear to have some side-effects that are related to the specifics of its implementation.

Process Improvement in Various Organizations

Nowadays, PI is studied in the context of different types of organizations. For example, it is paid increasingly close attention by healthcare organizations (Andritsos & Tang 2014; Boyer, Gardner & Schweikhart 2012). As explained by Boyer, Gardner, and Schweikhart (2012), healthcare professionals value PI for the enhancement of quality and safety, which often results in a better quality of life for patients and can save lives. Apart from that, Andritsos and Tang (2014) provide evidence which indicates that PI helps to reduce resource usage in healthcare, which is of particular importance to public hospitals that always struggle with underfunding. The articles devoted to healthcare PI indicate that both private and public hospitals can benefit from PI, and this tendency is not limited to the healthcare sector.

Indeed, Rinaldi, Montanari, and Bottani (2015) highlight the fact that even though the topics of efficiency and effectiveness were not traditionally considered in the context of public organizations, nowadays, it appears reasonable to change the tendency. Firstly, competition is present for public and private organizations, even though it is typically less intense for the former. Sanders-Jones and Linderman (2014) point out that not every aspect of process management is affected (moderated) by the intensity of competition in the field. Secondly, Rinaldi, Montanari, and Bottani (2015) point out that the pressure to ensure financial sustainability in public organizations is very high, especially given the economic instability of the past years. Thirdly, the customers of modern public companies have been exhibiting increasing demands for quality of service, and modern governments tend to search for the means of responding to these demands and improving public services.

Such governmental responses typically involve a form of process management, and in this case, PI or other process management types may be legislatively required. For example, there is an ongoing search for PI strategies in the healthcare industry, which, among other things, is carried out through the determination of best practices and their standardization at governmental levels (Andritsos & Tang 2014). Finally, Rinaldi, Montanari, and Bottani (2015) highlight the fact that the public sector accounts for a notable part of the economy of certain countries, especially in Europe, which raises the importance of PI in public institutions for these countries. As a result, modern public companies are likely to be as interested in PI as private ones. Here, governmental organizations and their quest for PI can also be mentioned as a specific type of organization that search for PI despite being non-private (Mishra, Das & Murray 2015).

Moreover, Haddad et al. (2016) develop this discussion by introducing non-profit organizations as the users of PI. In particular, they highlight the pressure or financial sustainability, the requirement of public support, and the wish to fulfill a socially significant mission as important drivers for PI in non-profit organizations. Also, they suggest that PI and process management can help to professionalize non-profit organizations, which is a common challenge in the sector. Thus, it can be suggested that organizations tend to be interested in PI regardless of their type because all of them can benefit from it.

Conclusion

The present paper investigates PI, which is a very popular topic for modern researchers and practitioners. The interest proves to be justified: while it is the least impactful of business management variants, PI tends to positively affect processes’ efficiency, effectiveness, and robustness, resulting in improved performance and sustainability as well as various specific outcomes like improved employee motivation. The effects can be enjoyed by private, public, and not-for-profit companies, all of which have sufficient incentives to engage in PI. It should be pointed out, however, that PI requires proper management, and modern best practices suggest making it holistic and systematic, paying attention to stakeholder engagement, and ensuring the use of technologies among other things. To sum up, PI is not an easy activity, but modern businesses of different kinds get involved in it because of the multiple benefits that are promised. As a result, it appears most important to proceed to research recommendations for PI to improve the chances of successful PI in companies of various types and sectors.

Reference List

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