Optimize your processes based on ROI

27/04/2018 - Teun Arts

In a competitive market there is only one way to survive as a company: you need to continuously improve. This means looking critically at how you work in your organization and which business processes can be optimized. When it comes to measures to improve your processes, Return On Investment should always be the objective. What costs are associated with the change (for example in time of your employees, extra facilities, help from external parties or new software) and what benefits does it bring (for example in profit, turnover, time savings, efficiency, convenience or a higher service level)?

Wrong motives to change processes

Organizational changes are too often driven by the wrong motives. Not ROI, but for example:

-   Cost savings: although lower costs are a good thing, the consequences must also be considered; if you lose a lot of customers because of the cost-saving measure, it may not be a wise action.
-   Limited by IT: the impossibilities and limitations of your software should not be the reason to change processes, negatively impacting your business.
-   Influence of one or a few employees: the people with the loudest voice or who are too stubborn to obey the rules might succeed in getting their way in terms of work procedures, while it is not for the benefit of the organization.
-   Short-term benefit: company policy is too often based on quick profits and short-term benefit, while the long-term success of your company is much more important.

Optimize processes; how do you do that?

Make sure you have concisely documented your business processes. Then critically look at where you can improve. How can the process go faster? Are there steps in the process that I can skip? Can I automate manual actions? For example, think about making quotations. Ideally, you directly present a beautiful quote to your customer tailored to his needs with the push of a button. That might be a bridge too far, but for many companies the process of creating and presenting a quote can be done quicker and better. Changing the process rarely costs you anything, while you will save time and thus money and your customers will be more satisfied.

Learn from 'best practices'

Optimizing processes is not easy. Sometimes it is simply too difficult to determine where and how improvement is possible. But your organization is not unique. Your competitors are struggling with the same challenges and you can learn a lot from them. How do they set up their processes? Quicker or better than at your organization? Look at the best practices in your industry and take advantage of it. That does not mean you should just copy what your competitor does. You should translate the best practices into processes that suit your company well.

Focus on what is most important

You do not have the time to optimize everything in the organization. You will have to carefully focus on what is most important. There is no use in spending time on a process that occurs only twice a year. Focus on the daily processes, the processes that really make a difference for your customers. And do not just discuss the processes and put them on paper. You need to implement the processes. You need to instruct people, adjust facilities, take charge and monitor the proper implementation of the changes.

ROI can be difficult to calculate

It can be difficult to calculate the ROI of a process change. The total costs are not always clear and it is even more difficult to express the (expected) return in figures. Nonetheless, you should try. Because decision-making based on ROI is much better for your company than decision-making based on how you feel, on good luck, or to keep doing what you are used to.

Teun Arts is Service Manager at Dysel and it is his job to ensure that customers make optimal use of the software, now and in the future.

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