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What you need to know about business process transformation

Apr 21, 2023

8 minutes read

There is an increasing need for the business transformation process to comply irrespective of the different organizations. Government regulations are dynamic, which makes it difficult for businesses to update their policies accordingly.

It can seem overwhelming, but focusing on modern approaches and techniques to process management and transformation can help to do it properly. To modify the business processes accordingly to new regulations and to bridge the compliance gaps, you need to opt for a business transformation process as a service solution.

Most companies think about a business process transformation roadmap when they need to significantly update existing processes by incorporating new technology, modernizing the processes, saving costs, and better integrating the core systems.

What does business process transformation mean?

What is business process transformation? Business process transformation completely changes business workflows, functions, and technologies. It allows businesses to accelerate the time-to-market for products and services and bring operational efficiency. It is like comprehensive reengineering of the whole business process, restructuring, and redesigning to improve operational efficiency and agility significantly. Innovation is the primary goal of a business transformation process, but adopting new capabilities, technology, and concepts is also essential. 

A successful business transformation process model is usually in tune with evolving process regulation policies and emerging market demands. It means that the business will grow with the implementation of newer innovations. 

A digital business transformation is the most typical way of process optimization that can save costs, modernize processes, improve customer satisfaction, increase competitiveness, and streamline core business functions.

Businesses usually use process transformation methodology if they are looking to implement a significant upgrade of existing processes. 

Business transformation can progress at a very high level of integration, planning, and alignment.

Usually, digital business transformation has been a necessary disruption for many organizations that focuses on achieving important business goals, such as becoming digitally focused and driving up efficiency.

A ‘big picture, small steps’ approach is typical for many organizations in the business transformation. The focus is on achieving a big vision going through many stages, which makes it more manageable for team members.

Why do you need business process transformation?

The two primary goals of business process transformation are: optimizing business processes and using innovation for better differentiation and business outcomes.

Each organization has different needs for business transformation. For example:

  • Cut costs: expense centers for each business are antiquated or redundant business processes. Successful business transformation steps eliminate extraneous steps in process workflows, eventually reducing costs.
  • Aligning new strategic goals with the working processes: changing customer demands or market trends needs a business strategy change. Digital process transformation is required to align with the latest business strategy.
  • Innovations as drivers for organizational growth: innovation is the cornerstone of forward-thinking businesses. 

Business transformation is a strategy that has to be taken seriously at every stage of business growth. It becomes imperative to prioritize the efficiency and effectiveness of business processes regularly.

A successful business process transformation can bring significant, positive changes in culture, go-to-market strategy, and operations.

For instance, COVID-19 has caused many organizations to rethink their business and become more adaptable. To decide if your company needs a digital business transformation, answer the following questions:

  • Does an existing process meet the primary needs of the organization?
  • Do you have a significant number of errors in an operational business process?
  • Did you update the surrounding technology, and when was the last time?
  • Does your existing corporate organization still make sense?

How to create a suitable model for the transformation process of your business? 

To work through the transformation initiatives, you must define a robust approach. The best way is to focus on small steps that can be defined, delivered, and analyzed before starting the next phase. It can help ensure that your detailed plans get scrapped, stalled, or heavily adjusted due to planning perfection.

Transformation involves setting up the team members’ approach and initiative. The core team should engage the key stakeholders to ensure a successful change. The team has to stay focused and aligned. It would help if you created an organizational transformation plan to work across multiple business areas and processes and build well-functioning communication channels.

To start understanding the most critical drivers of the transformation process and the whole context, think about the following aspects:

  • What regulatory, macroeconomic, social, and external forces shape your business?
  • What do your customers expect from you? Do you meet those expectations?
  • Are the significant risks for your company defined, monitored, and mitigated?
  • Do you expand the knowledge of your employees?
  • What main strategies need help in gaining traction?

Using these insights, you can create a strategy for transformation and identify areas ripe for automation, simplification, oversight, etc. With a profound understanding of these drivers, you can better target outcomes and build a transformation map that synchronizes efforts across the organization, sets quantifiable goals, tracks progress, etc.

Stages of transformation of business processes

The most crucial step of business process transformation is to identify the processes in your organization that need improvements or changes. Modeling existing workflow can help to see the redundancy, gaps, and repetitions.

Below you’ll find some steps for a successful business process transformation:

  • To establish clear goals for the transformation, you must analyze the processes to identify the areas to transform. It is essential to understand if you are moving in the right direction. Identify the goals of the transformation. Are you primarily trying to upgrade systems? Incorporate new technology? Adapt processes to a new organizational structure? What has caused the need?
  • Business transformations rely heavily on gathering metrics: time, cost, throughput, number of errors, and other metrics you can measure. Establish baseline metrics first, then capture details of the processes from existing documents, and collect all the data you need to be sure that your business process transformation will be successful. Charging your cycles will help you to detect flows in the working process. The gathering of metrics helps to identify issues that need to be improved. This step justifies the need to make specific changes in the workflow.
  • Ask all stakeholders involved in the process for their feedback. People play a significant role in bringing about a process transformation. Keep the stakeholders informed on what worked well in the past and what they expect from the new processes.
  • Using a diagramming tool, map out the best scenario and the ideal workflow path, including system and human tasks that need to take place. At this stage, you have to model alternative processes. For example, adjusted or new flows, activities, events, resources, etc. The outcomes from the analysis show if the modeling was successful. Sometimes the working processes turn out to be broken. In other instances, the needs appear to be new. So, this stage will help you cover new areas or ways of working and to design new processes instead of fixing issues in the old ones.
  • Before implementation, make a test: Simulate, verify, analyze, and implement the planned alternative processes in a testing environment to see how it affects the data, operations, and people. It helps to see how it runs between people and data, to define if they can perform in a live environment, helps to detect flaws, and to take corrective action. This critical simulation stage supports a stretched way of thinking, the ability to simulate and prove different alternatives to ensure that issues and risks can be identified earlier and fixed.
  • Phased implementation: only implement some of the changes at a time. It is better to apply changes in a phased manner. First, include small teams in the new process. Then, closely monitor the progress. Pay attention to any changes that need to happen for the process to succeed.
  • Generating instant feedback and measuring impact is very helpful for understanding the importance of changes that have been made. It can provide insights about the following needed decisions and the next area of focus. For example, you planned to implement three workflow changes to achieve a 10% improvement. If the first change achieved a 15% improvement, the others might not be required. Knowing this, you can look to bring forward changes in other areas.

Business process transformation and business process management follow similar steps, but process transformation attempts to make more significant and drastic changes. It would help if you had a technology partner for a successful business process transformation. Your partner can support you through all the stages: from planning to implementation.

In modern business practices, ‘big picture’ thinking, coupled with ‘small incremental steps,’ has significant value in offering transformation initiatives that reach that big end goal through taking lots of little steps that each deliver incremental value resulting in business growth.

Challenges in the process of business transformation

Like any other big paradigm shift, business process transformation provides significant challenges. To succeed, you have to resolve it. Let’s see some most critical challenges:

1. The engagement of the sponsorship needs to be stronger.

You’ll need strong sponsorship to go through the entire lifecycle, from creating an idea to development and implementation. 

2. Transformation of management methods.

Another challenge for business process transformation is constantly changing management practices. Even if the aging process might have been inefficient, people always prefer to continue working as previously. You must use sound change management principles to bring everyone along to implement a business process transformation.

3. Challenges of integration.

Integration can be one of the significant challenges in the process of business transformation. You may be limited in what you can integrate with other software if you don’t choose the right platform.

4. Missed key objectives.

If key objectives are missed, it is a significant challenge. Many efforts of business process transformation reach only digitizing a process. They don’t have a noticeable effect on the process efficiency. Make sure your successes are clearly defined and continue changes after achieving a dressed-up version of your old business process. 

Summing up

An essential thing in the business process transformation is not just changing business processes but changing people’s mindsets. At VITech, we have been changing people’s ideas of process transformation by delivering bespoke workflow automation solutions. Hassle-free implementations and seamless integrations define our automation solutions.

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