Measuring a Business Process How to Create Customer-Focused Metrics

There is a familiar quote that says, "If you can't measure it, you can't manage it." So, how do you know what to measure for a business process? It is different than what you would do in a manufacturing environment where you have specific defect metrics. For a business process, the metrics should relate to customer needs.

In step 2 (creating the foundation) of the 10 steps to business process improvement, you develop basic information about the business process. One key area included in the foundation is the measurements of success. After you identify your customer (or client) and what they need from the process, you should also describe how you will know if you deliver against what they need. At this point, simply write a sentence that outlines what you want to measure. Do not worry in this step how you will measure something - just identify what you want to measure. For example, a sales manager may describe a measurement of success as an "increased number of new customers."

Since you, or the project team, are simply describing general information about the process in step 2, you will find it fairly easy to define the what. If you have trouble writing the statements, ask questions like, "What does success look like?" "How will you know when you achieve success?" As you create the measurements, think about effectiveness, efficiency, and adaptability and attempt to write measurements that fall into each of these three areas.

Step 7 is where you spend some time thinking about how to turn your general measurements of success into specific metrics. By the time you get to this step, you have drawn the process map (step 3), identified how long the process takes from beginning to end (step 4), validated your information (step 5), and applied a series of techniques to improve the process (step 6), so you are well positioned to tackle the metrics challenge.

The sales manager's measurement of success may initially seem like an efficiency metric, because it seems to focus on volume, but if the sales manager also cares about the quality of new customers it might actually fall under effectiveness and read something like, "30 percent increase in the number of qualified new customers over the next six months." Notice how much more specific the metric is, from what appeared in step 2. However, if you had spent the time in step 2 to get at this level of detail, you would have found yourself buried in too much unnecessary information too early in the process.

In step 7 you also have to determine how you will deliver the metric. You may have to create a new tracking method, establish baseline information, or develop a new report. In step 8 (testing), make certain that any new reports meet the needs of the interested parties by showcasing a boilerplate version.

In step 10 (continuous improvement) decide how often you plan to review the measurement data. Will you do this weekly, monthly, quarterly, or annually?

Finally, remember that you cannot measure everything! Albert Einstein says, "Everything that can be counted does not necessarily count; everything that counts cannot necessarily be counted." So, use your customer needs as the source for what you measure. Include the most important effectiveness, efficiency, and adaptability metrics to start.

Business Process Outsourcing Makes a Company More Flexible

Outsourcing enables companies to bring efficiency in all departments. Increased efficiency will translate into increased customer satisfaction. When carrying out all tasks in-house, employees may be required to carry out tasks that are outside their expertise and the results are not always impressive.

Many companies are looking into hiring other companies to handle some of their activities. Often, these hired companies are outside the region, and sometimes even continent that the original business is in.

There are several industries that are opting for business process outsourcing due to the various advantages that it brings. The most attractive feature is the fact that this process helps a company to cut their costs drastically. There are several complications involved when a company is required to deal with each employee, and meet his/her needs. By opting to outsource business, time and money is saved by eliminating the need to factor in each employee. Business process outsourcing organizations are skilled in dealing with people.

Particular emphasis is placed on training employees to be able to carry out their daily tasks effectively. This is done by providing training before employees embark on a particular project. It is vital for the employees to understand the mission of his/her client, as well as the way they are required to carry it out.

Many times, those who do not pass this training level cannot carry on with the projects at hand. This training often requires the assistance of experts in the field. Companies take a load of their managers by having this organized for them. Organizations that are successful include a high level of specialization in the way that they are run. When each employee focuses on the tasks they are assigned, the flow of business goes a lot faster. However, some organizations opt to handle all business matters themselves. This can result in employees who are experts in a particular field, being required to carry out tasks that are outside their experience, expertise or interest.

By outsourcing, companies become better at ensuring of a high level of effectiveness in each department. This, in effect, will create higher levels of responsibility and hence accountability in the company. It is in the interest of a company that specializes in outsourcing to make improvements to their client companies. This is done by searching for methods to deal with the various factors that hinder the progress of a company. By doing this, one can improve the relationship that their company has with their clients. Increased efficiency will translate into increased customer satisfaction. This could simply mean that a company can be more time-effective and available for clients that need them. An example can be seen in the telecommunications industry; where a person seeking help over the phone may receive it from an outsourced company.

Business process outsourcing providers are often very flexible and therefore adapt well to change. Conditions in the market and customer requests are bound to fluctuate, usually in accordance with economic trends. A company may not have the capacity or resources to become dynamic. For example, outsourcing providers can help a company run a campaign for a new product, which the company itself does not have the time to do. By diversifying their options, as well as their products, companies can be assured to attract an even larger clientele base. The organizations involved in outsourcing are often insistent that each employee has an excellent work ethic.