Following recent events like the pandemic, the shift to non-office work models, and supply chain pressures, the demand for business process transformation has accelerated. Many leaders today realize that a radical change is needed to keep up with changing business environments and requirements. This radical shift begins with reassessing existing business process management practices, strategies, and technologies.
Here we’ll break down what business process transformation means, what drives the need to transform business processes, and the framework to unlock the benefits of a long-term and sustainable business process transformation initiative.
Learn how no-code automation can transform your business processes with No-Code Automation: Good for Business, Great for IT
Business process transformation definition
Business process transformation (BPT) is a strategic and tactical approach to completely redesigning, restructuring, and reengineering existing business processes to better achieve business goals. In other words, short-term improvements and investments lead to long-term success.
BPT is also synonymous with digital transformation, which is the growing “appetite for investment and the pursuit of this shift to digital” at every level of a business and across all end-to-end processes.
A successful and sustainable business transformation plan requires and is driven by various key factors, including effective change management, proper employee training and process optimizations, and an alignment with a company’s long-term growth strategy.
Business process transformation and business process management: What’s the connection?
Business process management (BPM) is a business discipline that involves identifying, evaluating, and optimizing individual processes in order to achieve business goals. This includes initiatives aimed at improving product development, customer experiences, and operational efficiency.
In a 2020 article published by the European Journal of Information Systems, “digital transformation provides us with a unique opportunity to sharpen existing BPM logics and extend them beyond their theoretical limits.”
In that sense, business process transformation is an element of a company’s larger business process management. It’s through business process transformation that BPM becomes more efficient, effective, and easy.
Why business process transformation is important
For companies deciding to transform critical business processes, the reason is usually to adapt to changing business and/or market conditions and achieve operational efficiency and agility.
Other factors that drive business transformation also include:
- Reducing business or operating costs
- Improving customer satisfaction
- Improving employee productivity and satisfaction
- Dissolving business process silos
- Streamlining business process tools and systems
- Digitalizing and modernizing manual and inefficient processes
- Gaining a better understanding of business process analytics
- Maximizing cost-saving opportunities
- Increasing profitability
- Adopting new technologies, processes, roles, or procedures to increase competitive advantages
It’s because of these driving factors that business process transformation is essential and necessary for companies that want to thrive in the face of large-scale industry disruptions, build sustainable long-term business strategies, and exceed competitors.
Common business transformation challenges (and how to overcome them)
As with any big change that’s pushing both real and theoretical BPM limits, a learning curve, resistance to change, or a delay in adoption can always be expected — and it can be guaranteed without a proper implementation plan in place.
One study found that, on average, a full transformation effort takes around three years to complete. But despite this timeline, 70% of transformation efforts fail. The leading cause for this? A lack of support and investment in people, not technology.
However, these challenges can be prevented or alleviated so they do not become even bigger issues for the business and teams. Below are some common examples of challenges that can stand in the way of business process transformation initiatives or lead them to fail, and what companies can do to overcome them.
Challenge: Resistance to change
Resistance to change is by far the most common and also the most detrimental. Resistance to change is not only a natural thing during times of transformation, it’s also a sign that leaders should heed in a timely manner.
Solution: If resistance to change occurs, it’s important to not only address the manner quickly but also approach the resistance with a sympathetic mindset. The key to battling this resistance to change is getting to the root of it, understanding the nature of resistance, and approaching this resistance with a proactive attitude.
Consider how employees (or even other leaders) may be feeling during this time of technical, social, and professional change, and offer clear solutions to address these feelings. For example, if the problem is technical knowledge, then create a plan for training or developing employees. Or, if the concern is not having enough information regarding the transformation roadmap, reassess communication and address any gaps in the roadmap.
Challenge: Employee engagement
It’s not unusual for employees to feel overwhelmed when decisions and changes that will inevitably impact them and their work are being made and happening. In the age of quiet quitting and great resignations, improving employee engagement and supporting employees amid large changes is critical.
Solution: As companies work toward creating a more digitized operation, it’s important that they do not lose track of their greatest asset: people. Whether it’s at the start of BPT planning or during the process remodeling, engaging with employees, seeking their input, and including them throughout the process transformation is crucial for the business and for employee engagement.
After all, it’s the process owners and day-to-day business process managers that have the most insight into blind spots and optimization opportunities.
Challenge: Inadequate change management
Business process transformation doesn’t happen overnight or by just snapping your fingers. It takes time and requires a change management plan that prioritizes not only the technology but also the people involved. This is especially true because it’s the people that will ultimately be responsible for executing and maintaining the transformation.
Solution: In addition to creating a roadmap for your business process transformation, it’s essential to also create a change management plan. This includes defining roles to maintain accountability and creating a system to adequately track and communicate changes with teams and establishing procedures that can be followed consistently and reliably.
Learn more about change management.
Challenge: End-to-end integration of technology, systems, and processes
The greatest challenge to BPT may be connecting the dots between people, processes, and technology in a way to integrate all areas in an efficient and effective manner.
Solution: Investment in technology that simplifies business processes, not creating additional complications or expanding the tech stack. With the right technology, companies can empower teams to unlock additional ways to generate business value, work in a more agile and market-responsive manner, and support IT teams by reducing the backlog and allowing them to work on mission-critical tasks to speed up the organization’s BPT.
Learn how low-code automation helps accelerate digital transformation.
Challenge: Process ownership or accountability
Communication is essential for any BPT initiative. But one challenge that can get in the way of even the most detailed roadmap is a lack of accountability or process ownership. By not defining the people or teams who are responsible for certain steps, phases, or approvals and communicating these roles effectively, improvements may not “stick,” goals may be misaligned, and processes may be doomed to fail before they even have a chance to perform.
Solution: Defining process owners and establishing expectations shouldn’t be an afterthought. Visibility, transparency, and effective communication with all stakeholders should be at the forefront of BPT initiatives and should guide how teams approach business process transformation.
10-step business process transformation framework
The operative words for a successful business process transformation initiative are reexamine and define, and both are applied in the following ways:
- Reexamine existing ways of operation
- Define the strategy and goals
- Reexamine the way teams are executing processes
- Define how to better support them
- Reexamine current business performance, bottlenecks, and pain points
- Define which metrics need to be monitored
- Define the approach to change management
While the steps a business takes to achieve business process transformation will vary depending on process maturity and the level of inefficiency, below is a universal and customizable framework to get you started on transforming, optimizing, and controlling your business process improvements.
1. Complete a business process analysis
Without a full understanding of your business processes, it can be difficult to understand what needs to be done. By conducting a full business process analysis and audit, you can determine what isn’t working, what’s holding your teams back, and better understand the structure of processes in order to optimize them for efficiency, productivity, and security. You can also learn how your existing processes are impacting your business.
Learn more about business process analysis.
2. Define the short-term and long-term goals
Before any improvements are made, it’s important to understand why they need to be made in the first place. By defining what you want to achieve with your business process transformation initiative and why, it will be easier to create a roadmap, improve employee engagement, and align business goals with business process transformation strategies.
3. Identify gaps or opportunities for improvement and automation
With the process analysis complete and goals defined, you now have a clearer picture of the as-is state of your business processes and the impact on teams, customers, and the overall business. Now’s the time to identify what can be improved.
Get started by learning more about business process design.
4. Establish KPIs
In addition to highlighting what can be improved, it’s just as important to highlight how these improvements will be measured to determine whether the improvements are making a difference for the overall business efficiency. These will vary depending on your short- and long-term goals.
5. Design a transformation roadmap and timeline
Communication is the key to successful business process transformation. To keep everyone aligned, design and share the complete transformation roadmap and timeline so leaders, process owners, and stakeholders are all on the same page. With a roadmap and timeline defined and documented, it will be easier to manage changes and updates to the plan as they arise.
6. Define and assign process owners and stakeholders
Ensure accountability, and get ahead of any confusion or disagreements by involving approvers, process owners, and any stakeholders that will offer feedback prior to getting started to set expectations early on.
7. Communicate plans, changes, procedures, and new policies
As with any big change, those impacted will need to be alerted of changes, how it will affect them, what these changes will look like, what they mean for them and for the business, and the timeline for these changes.
8. Design and automate new processes and workflows
This is where the areas for improvements that were highlighted during the business process analysis step come into play. During this time, you’ll also want to integrate new and existing tools and systems to improve end-to-end operational efficiency.
Here’s how low-code automation can help improve digital experiences for both employees and customers.
9. Test, test, test
And test again until processes are functioning as planned and creating value for customers and stakeholders.
10. Push live, monitor, and evaluate process performance
Once your fully transformed business processes are live, it’s time to sit back and watch the operational efficiency grow — and it’s also time to begin the next chapter: continuous process improvement.
Continuous process improvement is key to maintaining your newly transformed processes and evaluating whether they are achieving the results and goals defined at the start of this process.
Business process transformation success stories
Business process transformation can be applied across many business areas — like HR, Finance, Procurement, Customer Support, and more — to improve the overall efficiency of the business, as well as customer and employee satisfaction. Here are two examples of how companies transformed and modernized manual processes to achieve better results.
Capgemini: Efficient HR processes, better SLAs, and real benefits for employees
- Solution: HR
- Challenges before: Employee dissatisfaction, legacy process with pre-existing bottlenecks, high volume of frustrating and inefficient manual work
- Results after: Faster delivery, SLA moved from 38% achievement to a monthly average of 98% achievement, reduced the costs of managing HR requests by 42%
Learn more about Capgemini’s improved HR processes.
Ocean Network Express: Clear skies and open seas for the AP department
- Solution: Accounts Payable
- Challenges before: Lack of communication between departments and systems, manual and decentralized accounts payable processes, and delayed payments
- Results after: Streamlined communication and collaboration with external stakeholders, automation triggers for invoice approvals, standardized and automated end-to-end AP flow, 100% integration with SAP
Learn more about how ONE set sail on its digital transformation journey with accounts payable automation.
Get started on your business process transformation
According to one report, spending on digital transformation is expected to hit $3.4 trillion by 2026 — a tremendous increase from the projected $1.6 trillion in 2022. This projection highlights a growing interest that’s backed by large investments in process modernization and digital innovation.
At its core, business process transformation isn’t just about updating business processes; it’s about taking a holistic and honest look at the workflows, tools, functions, procedures, systems, and technologies that run critical business processes. And with the right technology to support both processes and people, jumpstarting your business process transformation is within reach.
