Business Process: Definition, Types, Tips, & Lifecycle

Last Updated – Nov 29, 2022 @ 9:14 am

The goal of every business owner is to achieve success, and the secret to getting this goal is to ace your business process.

Whether you’re thinking of starting a business or already have a small business that you run from your home kitchen or a multi-million corporation that provides B2B services, you need to know what business process is suited for it. 

What is a Business Process?

A business process refers to a collection of linked tasks that allow a product or service to be delivered efficiently to the customer. A business process is also defined as a set of activities that accomplish an organization’s goal.

Each step of the business process should be assigned to a single person or department who is most capable of it. The steps that are part of the business process can also be repeated over and over again in an optimized way. 

Importance of Business Processes

You won’t believe the number of hours wasted by employees per week because of the lack of business processes.

The time doing meaningless tasks can be eliminated by streamlining business processes and operations. This will also save your employees from wasting effort on things that don’t matter in the long run.

Here are some of the importance of business processes. 

It aligns operations with the business goal

Every move of your company must be driven by your company goal and strategy. Whenever you change these things, it should also reflect on your business process.

Therefore, managers, executives, and other workers can maintain consistency and align it with the overall strategy of the company.

When these business processes are performed by capable people, companies can avoid the risk of failure in execution. 

It improves communication

Companies that follow their own business processes have a clear idea of what they should do, and what the role of each member is.

When you have a business process, you can have a unified language and method for your entire communication processes.

This is not only ideal for old employees but also for the training of new team members. More than that, it minimizes the loss of staff. 

It saves money

One of the benefits of business processes is it allows companies to identify different areas where there is unnecessary spending, and find ways to make every activity better.

This enables companies to save money that otherwise can be used on more important things. 

It increases consistency

Successful companies that have business processes can execute processes more consistently. This way, guesswork will not be a problem, and even exceptions can be handled more efficiently. 

It helps operational efficiency

Every business owner wants to achieve the best results for their company using the resources available to them. 

When there are business processes in place, there will be no room for waste and inefficiency. It also drastically increases productivity and helps the staff to achieve more output even with less time. 

When business processes are followed, standard operating procedures will be cemented, and it will enable staff to work well even without the intervention of managers. 

It enables businesses to gain an advantage

Considering all the benefits mentioned above, companies can gain a significant edge over their competition.

As the business processes are refined, the staff, customers, managers, and all stakeholders can feel and see the difference in operations and sales.  

Types of Business Processes

We’ve rounded up the 3 major business process categories below. 

Operating process

This is the major function of any business. It is directly related to the mission, vision, and values you have set in the beginning.

Also known as primary processes, this business process category needs to be prioritized because it will set the tone for your revenue stream. 

For instance, the operating process of a fast-food chain would involve taking customer orders, efficiently making the food, and serving food to the customer in under 1 minute. It also involves the following:

• Sales & marketing
• Customer service
• Finance department
• Operations processes
• Production

Management process

This business process involves planning, organizing, and coordinating the functions of businesses that are covered by managing processes. These steps are goal-oriented and help different team members achieve their targets. It also helps the growth of your business. 

For example, a fast-food chain’s managing process will involve managers, CEOs, and other top-level employees, as well as leadership and other top executive decisions. It also includes the following:

• Closing and opening of departments
• Expansions
• Product launches

Supporting process

This category includes processes that are not related to the delivery of the service or product to the customer. However, it still helps businesses establish a better environment so the primary processes can become more efficient. 

Going back to the fast-food chain example, its supporting processes will involve the following:

• Accounting process
• Management process
• Human resource department

Related: Types of Business Models

Examples of a Business Process

This section will give you ideas on how you can implement business processes in your company.

Hiring process

Every business needs employees. To help you choose better professionals, you need to streamline your recruitment and selection processes.

If you want to make your hiring process better, you can use automated tools that assess applications more efficiently.

These tools can help you search unique keywords in every application so you can identify candidates that suit the available positions. 

Delivery management

If shipping is part of your business process, you must prioritize your delivery management process.

This includes receiving orders, naming employees that will put together the orders at certain times, and shipping these orders out. Someone should also be assigned to take care of the invoices.

Product development and creation

These include the steps that are involved in designing, creating, and manufacturing products to give the customers the best output.

Handoffs

Employee turnover is unavoidable for businesses. This type of business process involves the transfer of responsibilities, information, and staff.

It is essential to ensure the business continues to run smoothly when an employee resigns, or when it goes through team restructuring. 

Business process mapping

The goal of this visual guide is to properly document and communicate the processes of the company in all departments.

Therefore, people can understand how processes and tasks overlap. 

Elements of a Business Process

Here are the various attributes of business processes.

Finite

A business process must be well-defined from start to end. It should also have a set number of steps.

Repeatable

Business processes can be run multiple times and it should deliver great results consistently.

It adds value

The major goal of business processes is to add value to tasks. So when a business process does not make a task easier or faster to do, it should not be part of the process.

Flexible

Solid business processes must be flexible to change. When an area of improvement is found, the change needs to be adopted by the company without affecting stakeholders. 

Team members

Every step of the business process must detail the team members who are in charge of performing the step.  

Related: Business Development 101

Business Process Lifecycle: How to Create a Business Process

A lot of companies think that creating a solid business process is intimidating.

However, all you need to follow are the steps below to ensure you come up with a business process that will add value and efficiency to your company. 

Identify your goals

When creating a business process, never miss this step. Keep in mind that your short and long-term goals will serve as the foundation of what you want to do and achieve for your business. 

Create a plan

After identifying your goals, outline the procedures you need to do to achieve these. You can create a plan per department. This is the macro part of your plan.

Do the extra mile by looking at more in-depth tasks within each process involved. This is the micro part of your business process.

Assign tasks

Depending on your company structure, you can assign tasks to certain departments and people.

Make sure that they understand what you need from them, as well as the instructions needed for them to achieve their duties.

Test the business process

Before you finalize your business process, make sure to test it first. This will help you see whether or not departments and employees are receptive to the process, and if they understand their duty.

This is also the time to ask for suggestions.

Measure its success

Monitoring the success of your business process is critical if you want to find out whether or not it helps the company achieve its goals.

You can do the review every month and compare data from the previous month.

Some of the areas of success you can assess include delays, delivery time, and customer service efforts. 

Change as needed

If you still see gaps in your business process such as a decrease in productivity and confusion among staff, find out the root cause of this problem and examine how you can change processes to make every step more efficient. 

Business Process Modeling: How to Make a Business Process Flow Chart, Map, or Diagram

Business process mapping is a visual approach that shows the “who,” “when,” “what,” “where,” and “how” of every step, to find out its “why.”

This is an effective way to document existing processes or make a new one. Here’s how to do it. 

Identify processes

When making a visual business process map, you first need to identify the processes you need to include it in, as well as its purpose. It is also recommended to specify the scope. 

Gather information

Before writing the steps down in the map, you first need to gather information. Keep in mind who is in charge, what their duties are, when it should be accomplished, and how it should be done. The more detailed it is, the better.

Ask your staff and stakeholders

If you want to come up with an inclusive business process, you need to talk to different stakeholders. Talk to your staff and managers to understand what they are doing.

This will help you solve minor and major gaps and systematize the processes more. 

Draw it

Using the shape of your choice for this visual business process, use your information as the basis for your business process flow chart.

Make sure to use the right symbols for each process since this will make it easier for people to understand the intended workflow better.

You can use line arrows or dotted arrows. Also, keep in mind that the start and the end of the process should be clearly defined. 

Review it

Whether your business process is visual or not, it needs to be reviewed and adjusted based on your observations. 

Tips for Creating & Developing Business Processes

Here are some tips you need to keep in mind when making your business processes. 

Keep it simple

You may think business process plans should be packed with information. However, the modern style of the business process says otherwise. If you over complicate your map, chances are, most people will ignore some processes. 

As much as you can, do not overwhelm your stakeholders. Instead, do your best to capture your business workflow in just a few steps.

This way, it will be easier to follow. Your goal should be for employees to understand the entire business process in a single glance.

Talk to your department heads

Even if you think you already know your business, you still need to talk to all department heads.

These people will give you more information on their tasks so you can streamline your business process even further.

Remember that technology is your friend

If you don’t think you can create a business process workflow on your own, invest in reliable software. This way, it will be easier to assign tasks and keep track of all the steps involved in the process. 

Don’t forget exceptions

Just because you need to simplify your business process does not mean you should forget about exceptions or minor tasks. You can list these as notes.

For instance, if one of your activities includes “making a burger,” it can include “examining if the burger bun is already expired” as a note.

This task may not be needed to do all the time but it should still be included. 

Start each activity with a verb

Every step should begin with a verb to enable users to immediately understand what they should do.

For example, instead of writing “sales orders,” you need to specify the task and write “enter sales orders” instead. Always be clear and do not use vague words. 

Add sub-processes and media

Every activity and process must be understood in just one glance. However, do not list more than 10 steps. If it exceeds this number, separate it into various sub-processes. 

To make your business process more visual, do not be afraid to add images, videos, and graphs. This will make it easier for your staff to follow and remember each step. 

Related: 50+ Business Tips

Important Terms related to Business Processes

We’ve gathered common phrases and terms that entrepreneurs encounter when creating or changing their business processes. 

Activity

This refers to the steps involved in the business process. 

As-in process

This is the visual representation of business processes in their current state before changes are made.

Bottlenecks

This involves a chain of processes that when limited, will impact the chain by limiting subsequent processes. This can be either short or long-term.

For instance, a short-term bottleneck can happen when an employee takes a week off for vacation. Meanwhile, a long-term bottleneck would be if a production machine gets broken. 

BPMN

This stands for Business Process Modeling Notation. This standard for business process modeling is a graphical representation for specifying the processes included in the model. 

BPA

This Business Process Automation is a concept that refers to taking advantage of technology to automate manual business processes.

BPI

Business Process Integration happens when various organizations in multiple verticals improve operations to reach their goals by automating their processes.

BPM

Business Process Management is a discipline that uses methods to research, analyze, model, design, and automate business processes.

Business Process Monitoring

This involves actively monitoring the processes and activities to help the management understand how each step is functioning, and assess if the activities are in line with the company’s goals. 

Business Process Transformation

This term involves changing a series of actions to meet your company’s goal. This ensures that the goals, employees, technologies, and processes are in line with each other.

Business Process Simulation

This analysis tool involves measuring the performance, identifying bottlenecks, testing changes, and finding out how processes operate in different conditions. 

Deliverables

This refers to something you produce, or the output of the process. 

Document Management System

This is a software system that is used to manage, track, and store electronic documents.