Companies seek operation excellence, but struggle to control their processes
In a business world ruled by new technologies, automation initiatives and other digital innovations, many companies are struggling to turn their business processes into an enabler for operational excellence. As business processes are often considered a ‘black box’, how can you effectively manage them?
Business processes are recognised as the backbone of every company
Awareness that business processes are key drivers of operational excellence was confirmed by the questionnaire: 85% of respondents review their as-is processes at least periodically and attempt to adapt their way of working accordingly. Almost half (47%) mentioned a process optimisation function within their organisation, which is a crucial element in a structured approach towards company-wide process improvements.
Indicative of the eagerness of companies to strive for process excellence is the low number of participants (two) not actively pursuing process optimisation.
Companies have no or little view on the business process flow
Whereas companies acknowledge the relevance of well-designed business processes, the actual performance of these processes is very often a black box for management and even for process owners. Process insight is, however, the very knowledge needed to steer the organisation in the right strategic direction.
We see multiple factors that contribute to a blindfolded view on processes, but essentially they all relate to a higher level of complexity originating from within the company:
Increasingly divided responsibilities and trends towards automation triggered by large-scale business transactions.
End-to-end processes being supported by different systems and teams.
Acquisitions and centralisation where legacy processes are retained (or abandoned at a slow pace) within local entities, causing discrepancies with the central entity.
Analysis shows processes often flow in many different ways
Often in ways other than were designed
Looking at how respondents assessed their process performance, 49% indicated their documentation wasn’t aligned with the actual process, which is driven by adaptations and alternative process variations over time. On the other hand, 51% of respondents claimed their process execution was fully in line with documentation and that deviations were impossible because of automated process flows.
Knowing that only 14% of the 51% were familiar with process mining techniques, and based on our own experience, we conclude that the majority of respondents were unaware of their process performance, so they tended to overestimate the level of standardisation.
Process mining can demystify your business process and help you see where and how you can (and should) steer to improve
One of the most advanced techniques available to gain an understanding of the performance of business process and to overcome the knowledge gap companies experience is process mining.
Where traditional techniques of process discovery are based on stand-alone analytics or subjective interviews, the technique of process mining offers management a single source of truth originating from objective data available within the information system. The power of process mining is the end-to-end view on the process, built up from the lowest level of detail - the transactions - and allowing for both high-level and drilled-down visualisations.
Process mining vendors in a nutshell
Riding the wave of enthusiasm and optimism about process mining, more commercial and open-source software solutions are responding to the opportunities arising with this technique. Being a driver of process mining and its applications within the business, PwC’s in contact with the various process mining software vendors.
Our report lists several solutions that are currently on the market and compares the features of each. While there’s significant overlap, there’s also a trend in differentiation, mainly in visualisation and functionalities.
How do we put process mining into action?
To define actionable optimisation steps, it’s important to focus on the process areas that truly matter and that are feasible for improvement. Although process mining analysis offers you the possibility to work on the end-to-end process, a smart initial approach would be to go after the low-hanging fruit and realise short-term achievements. That way, a positive perception is set to convince stakeholders and management about the process mining-driven optimisation approach. More than elsewhere, management buy-in is key and staff will follow if advantages for the company are clearly defined.
After having gained the first successes with process mining, the journey doesn’t end. Opportunities will occur almost automatically within other areas, bringing you closer to the ultimate goal of operational excellence.
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