November 9, 2021 By IBM Cloud Education 7 min read

Learn what business process analysis (BPA) is and the types, methods and steps for small-to-medium enterprises (SMEs) to consider.

Business process analysis (BPA) is an approach to analyzing business operation processes. It is a detailed, multi-step examination of each part of a process to identify what is working well in your current process, what needs to be improved and how any necessary improvements can best be made. There are different business process analysis methods, but all apply the underlying principle that optimized systems generate better overall business results. 

Common desired outcomes of BPA are greater cost savings, increased revenue and better business engagement. For instance, you might use BPA to analyze customer engagement and where there are downturns, blocks or unexpectedly low conversions. Business process analysis can also reveal what in your business operations or policies creates low employee engagement.

Business process analysis (BPA) vs. business analysis (BA): What’s the difference?

There might be a little confusion about the difference between business process analysis (BPA) and business analysis (BA). These are related areas of business process management but are not the same. BPA focuses on specific process analysis and business process modeling. BA, on the other hand, is applied to the greater business operation landscape. BA focuses on the analysis of other areas, such as financial forecasting, cost analysis, budgets, hiring and cuts. 

Benefits of business process analysis

The overarching benefit of business process analysis (BPA) is optimized, daily functionality across your business operations that strategically aligns with your business goals and decision making. 

For SME businesses, BPA can create the following improvements:

  • Increase efficiency in existing processes: BPA increases time-to-value for product applications. It also lowers time in operational cycles for workflows, such as employee onboarding and customer or patient in-take processes.
  • Reveal capacity issues: In any process, resources can be limited. BPA identifies where the capacity limit lies, how it affects the process and how to improve it. This is a strong consideration for scaling. For instance, digital tools and platforms you currently use may limit current organizational needs and workflows. BPA can help you identify changes you need to make that are specifically aligned to your organization’s growth.
  • Clarify policies and rules: As organizations move to more remote work and greater adoption of digital devices, a common misalignment exists in security and device usage. The analysis can identify a path for faster IT approval processes and uniformity in security policy enforcement.
  • Create better governance practices: Risk management is increasing as a priority for businesses. Compliance is a costly endeavor for organizations to maintain, and it is even more costly to address when issues arise. Business process analysis can reveal where compliance measures have faltered. For example, your organization may be out of compliance in the frequency you audit application security measures. BPA can set an improvement plan in place that considers resources and compliance needs to ensure a process can be executed — and sustained. 
  • Identify cost savings: BPA reveals redundancies in tasks and labor. Organizations that have moved to digital document workflows are a good example how reduced human error and time in searching for documents creates cost savings.
  • Solve for bottlenecks: Bottlenecks occur when channels for communication, development and execution are siloed. A business process analysis can expose communication gaps and resolve approval process obstructions.
  • Optimize deployment and release processes: Efficient processes create smoother releases and deployments.
  • Improve integration and adoption processes: Similarly, adopting new technology across an enterprise or department is a monumental process. BPA sets processes in place that can include useful training programs and workflow visuals that support higher adoption rates.
  • Strengthen company culture: A better process in any area is a housecleaning of sorts. The improvements breathe new life into employee experience on a daily basis. The result is better morale and better engagement for internal processes. For customers, optimized processes — such as a better website or customer service experience — increases engagement and positive perception of your business. 

Methods of business process analysis

There are two predominant philosophies that guide business process analysis (BPA) methodology: 

  • Six Sigma approach
  • Lean Six Sigma

Six Sigma is a five- to seven-step methodology that most businesses today use to analyze efficiencies and restraints. Lean Six Sigma differs slightly in that it is a combination of the Six Sigma approach and Lean philosophy. It’s a collaborative approach that focuses on eliminating tasks and resources that don’t provide defined value.

You’ll gain a sense of how a business process analysis is executed when you consider the detailed-nature intrinsic to every step.

In general, BPA follows this structure:

  1. Define: Start by identifying the processes you want to analyze. Typically, these are where you see problems first. Process analysis can start with (and also include) process diagrams for each step. Analysts begin with as-is processes and look at formal and informal processes, such as documented processes and processes specific to an organization’s culture.
  2. Measure: Next, review how the process functions against defined metrics. This step is also at the root of helping to create improved KPI metrics. If those are well-defined first, a business will measure processes against the KPIs. KPIs include efficiency versus effectiveness indicators, quality, productivity, profitability and value indicators. They also include competitive and capacity indicators. For instance, customer engagement workflows might be measured by quality and effectiveness versus efficiency metrics.
  3. Analyze: There are several types of analysis techniques, and each one serves a different purpose. Business process analysts might run a value analysis, a gap analysis or root cause analysis (RCA). These are extensive analytical methods that each include their own set of steps. A gap analysis reveals what’s missing in the process. A value analysis conveys what is of value within the process — and what is waste, as a result. A root cause analysis applies certain “why” questions and methods that help you to work backward to the root cause of the problem in a process. 
  4. Improve: Business process managers collaborate with analysts to create and execute plans that improve problem areas. Improvements may mean re-mapping a process, increasing resources or shifting communication approaches and channels. Again, this can be a detailed step that can apply a variety of improvement methods.
  5. Control: After such a significant analysis, controlling the new standards and processes is the final step. Decision-makers can use the analysis to then manage resources, responsibilities, hiring processes, IT, administrative and executive processes. Stakeholders also monitor these changes and set time markers for future analysis.

When to implement business process analysis

If you’ve recently adopted new technology that’s being underutilized, or if you have recurring turnover in one area of your business, business process analysis (BPA) is a useful tool to uncover the reasons for these outcomes and then to set process improvements in place. 

Your business goals determine where and how you implement business process analysis. Organizations that value employee and company-wide problem-solving and process improvement as a core part of their culture set a foundation for better morale, lower turnover and better customer experience. So, whether you apply business process analysis tools informally, or you formally audit processes quarterly or annually, it should be a fundamental part of your business function.

Business process analysis begins with analyzing as-is processes. Business process mapping is a common tool used in BPA. It is an important visual resource and document to draw upon for your analysis. Using the documentation and insights gained from the analysis, your organization can then create a business process improvement plan. Business improvement plans will typically generate new business process models, using flowcharts, with improved process flows.

Keep in mind, business process analysis relates solely to your business operation processes. It is not the method of analyzing areas of business that aren’t specifically process-related. Process analysis in business is its own defined discipline. It is a guide for optimizing every operational area of your business.

Examples of BPA include the following:

  • Reviewing employee on-boarding to align with business culture and better engagement.
  • Analyzing marketing processes to reconcile whether metrics and paths align with key performance indicators (KPI), such as how well customers are converting or how many qualified leads are engaging with your business.
  • Uncovering where inefficiencies exist in technology adoption processes.

Tools of business process analysis  

In process analysis, analysts use diagrams to define input and output points, tasks sequences and what processes are sub-processes nested under main processes.

Analysts also use software to map and create workflows. This includes software that automates business process analysis (BPA) and enables organizations to apply end-to-end process modeling to map when a process starts and determine when it ends.

Process modeling and process mapping tools are integral to BPA. Organizations use business process model notation (BPMN) diagramming and supplier, input, process, output, customer (SIPOC) model diagramming as two workflow solutions for better operations. These visual tools are an excellent way to show changes in a process. They can be used as a “before and after” visual guide to train employees, for instance, or to map every process improvement back to your key business goals. 

Who oversees business process analysis?  

You might be wondering at this point, who in an organization is responsible for BPA, given roles, resources and skill sets?

Certainly, resources can be limited for SMEs. Working with an outside business analyst consultant might be the most viable route.

At the enterprise level, businesses employ business process analysts and process architects to perform business process analysis. These are different terms for similar roles. Both of these roles might work with business architects or work with executives and division leads. 

In addition, business process analysis relies on the expertise of subject matter experts. These might include a number of employees, stakeholders and consultants, such as analysts, data scientists, quants, IT, administrators and employees who are closely aligned to a process. 

Automation and BPA 

Currently, hyperautomation is considered one of the highest priorities across enterprise businesses. Gartner has forecasted that the industry will reach $600 billion by 2022. Hyperautomation steadily decreases the amount of human intervention for a fully automated, responsive process — or a smart process.

Your organization may want to consider specific questions to move toward automated processes: 

  • What key areas do you seek to automate and why?
  • Are there more common manual errors or misapplied policies? 
  • Where are there costly and high-volume processes? 
  • Has the organization determined obvious process problems? 
  • What creates customer dissatisfaction?

Business process analysis (BPA) can help your organization create a documented, mapped path to integrating automated processes and moving toward a goal of hyperautomation. As an example, moving from a hybrid to fully automated customer chatbot support is one way service centers lower costs and optimize customer support with hyperautomation.

How small-to-medium enterprises (SMEs) can apply BPA

How do SMEs best apply business process analysis (BPA) to start?

First, target mission-critical processes with the highest business impact. Then, consider mapping a process for automation. 

Next, standardize automation documentation — as well as process documentation — across departments and your organization.

For instance, IT can use BPA to map the process for software security protocols for various roles, which enables your organization to better manage onboarding and scaling as a result.

Business process analysis and IBM 

IBM provides process templates for project-based process analysis that are based on BPMN diagramming. Process mapping is integral to an optimal automation strategy.

Learn how IBM Business Automation workflows enable your business to mine process data to gain critical insights and automate digital workflows on-premises or in the cloud.

Download IBM Process Management for Dummies as a resource to learn the basics of process management to drive competitive practices and processes.

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