As mentioned in a previous post in this blog, Business Process and Performance Management (BPPM) support the business value drivers that determine the valuation of a business in the long term. I listed 6 drivers from Jack Alexander’s book and 3 of them are crucial in an economic downturn as we see it now. We can’t do too much now around sales growth, but we can actively manage those processes that impact on the operational effectiveness, capital management and those intangibles that have an impact on the value of a business.
Operational effectiveness is crucial to the survival of businesses even though growth is slowing down, access to operating capital is restricted and many of the larger organisations cut jobs to balance the books. The challenge remains that the business continues, customers have the same expectations and processes need to deliver the at even higher services levels to capture those customers from competitors. Operational effectiveness does not only address faster, better and without the quality requirements, but it also impacts operational risk where organizations are exposed to higher levels of risk due to increased workload on those that remain, new skills that need to be acquired to do the jobs of those that left and the new compliance requirements, specifically in the financial sector. Focusing on improving business process performance through business process management will highlight those areas of increased exposure that can be supported through a BPMS. Defining Process Performance Indicators for customer facing and business critical processes will allow organisations to track lead process indicators that will provide guidance on how to effectively manage these changing circumstances.
Effective Capital Management and managing those intangibles in a business that drive the business value in the long term can be supported by improved business process and performance management systems. It will provide consistency, transparency, business rules that can be adapted to the requirements of the changing environment and a governance framework that give management teams some level of comfort during the current economic challenges.
Filed under: BPM, Performance Management
