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Guest AuthorKarthik Subburaman

Guide to Business Process Management Metrics

By Karthik Subburaman

Business process management (BPM) metrics serve as goalposts to facilitate operational improvement and enable business success. It is composed of key performance indicators (KPIs) which are measured and analyzed to help decision makers come up with strategies that contribute to a positive impact on the bottom line.

The right metrics can help you understand where your business is right now and what needs to be done to achieve your goals. When your KPIs are aligned with your company objectives, it can be a key factor in long-term, sustainable business success. BPMs benefit organizations by promoting accountability, clarifying goals, and prioritizing the allocation of scarce resources.

How to Develop BPM Metrics

1. Focus on a Critical Few

Start by focusing on what exactly needs to be measured. You need to zero in on critical metrics that will deliver the most impact on what you want to achieve.

It is best to identify a few key metrics instead of trying to come up with several because too many KPIs can overstretch your limited resources. Having too many metrics, no matter how useful they are, can distract you from the few that truly matter.

2. Be Honest About Your Current Status

Ask yourself how your business is doing right now and answer it as honestly as possible. Be specific and narrow down your answers until you get to the root of your current issues, if any.

For example, if your company is getting complaints, drill down further by asking where they are coming from. Are those coming from a client just as important as those coming from a CEO? Prioritize based on your questions until you find out where you stand at this specific juncture.

3. Examine How Metrics Are Being Tracked Today and Improve on It

The best way to find out what your current measurement methods are is by asking those who use it. These are typically your front line workers, although more often than not, they fear being reprimanded when they speak their minds about it.

Seek to reassure them by responding in a supportive manner, not in a punitive way.

4. Every KPI Should Follow the FACE Component

FACE is a Yale-patented acronym that stands for Fast, Accurate, Cost-effective, and Easy. It’s a useful indicator to show whether or not the performance indicators you are trying to measure complement the existing, more established KPIs you are currently using.

Metrics to Measure for BPM

1. Baseline Metrics

This is an important first step because baseline metrics serve as a starting point and point of reference to measure how well a BPM project is doing.

2. Goal Metrics

These are the expected metrics to follow after the process has been redesigned and implemented by the process owner and executive sponsor.

3. Improvement Target-directed Metrics

These are based on what the process owner identifies as metrics that require improvement. It can be composed of many categories for measurement, and must be given top priority because these help your team filter out the less critical metrics from the important ones you need to focus on.

4. Customer Metrics

This metric focuses on what customers need, want, and require from the business process. It also gives an insight based on a customer’s vantage point.

5. Waste Directed Metrics

These are metrics identified by the team as wasteful processes that frustrate them the most, cause delays, or use up too many valuable resources.

Best Practices in Measuring Business Process Management Metrics

1. Measure a Few Things Well

Set clear, specific goals from the outset and focus on a few. Start by selecting metrics that are of high value to your business, especially in the beginning.

Senior management and shareholders usually prioritize finance-related measurements first before looking at other business aspects such as operations and customer service.

2. BPMs Should Be Easily Accessible

Metrics should be highly visible in the workplace where employees and members of the organization can see it in plain view. Frame it, hang it as a poster, and put it on a wall with high foot traffic.

Don’t bury it in a computer file that will just gather dust. People need to be frequently reminded, so make it easy for them to view it and access it regularly.

3. Prioritize Outcomes, Not Just the Process

Focus on the result by tracking it from a customer’s point of view or product standpoint. These are the ones that provide that most value.

4. Utilize Standard Measurement Tools

There’s no need to waste time reinventing the wheel. There are numerous established methods that have tested their mettle in various situations through the years, so take advantage of the best practices culled by large companies to track their progress and improve their processes.

5. Talk to Customers

Don’t make assumptions on behalf of your customers. Reach out and talk to them. Ask them about their concerns, pain points, and feedback. You’ll be surprised by the insights you’ll get just by listening carefully.

6. Align Metrics to Your Overall Business Objectives

When you come up with a strategy, remember to link it with your metrics for optimum results.

7. Take a Closer Look at Your Current Performance

Measure where you are right now by gathering baseline data for each metric. This will be your basis for analyzing future progress and will be used for correcting mistakes or introducing process improvements.

 

Takeaway

Using the right business process management metrics gives you valuable insight into what’s working and what’s not based on the objectives you’ve established.

Business owners know that what gets measured are the ones that can be managed properly. Metrics serve as headlights that illuminate the way for you to see the guide posts on your way to business success. They help you formulate informed decisions instead of driving blindly, potentially costing you valuable time and resources.

Use BPM metrics to help you focus on KPIs that are aligned with your overall goals and strategies, and use it to correct mistakes and introduce process improvements on a regular basis.

Originally Published @ http://apexgloballearning.com/blog/business-process-excellence/guide-business-process-management-metrics/

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