Efficiency is crucial in manufacturing. But as time rolls forward, it can be easy to lose sight of the original strategies and goals your team set at the beginning of the year. That’s where business process reviews (BPR) step in.
If workflows at your company are starting to feel disorganized, employees and customers seem to complain a little more often, or you’re losing time and money and you don’t know why, it’s time to conduct a business process review. A BPR will help you identify your problems and find the right solutions.
In this article, we’ll explain what a business process review is, how to conduct one, and how to know when it’s time for an enterprise resource planning (ERP) solution.
What Is a Business Process Review (BPR)?
A business process review (BPR) is a structured evaluation of your business’s processes, workflows, and procedures. The goal of a BPR is to identify areas for improvement, efficiency gains, and cost savings.
Manufacturers use business process reviews to analyze how tasks are currently performed, identify bottlenecks and inefficiencies, and recommend changes or optimizations to streamline operations, from design and engineering to production to delivery.
Key Features of a Business Process Review
While every company tailors its BPR to its own unique needs, there are some all-encompassing aspects that you should start with:
- Map your processes. Start by creating a flowchart or other visual diagram that shows how tasks and activities are performed within your business. Where does your business begin (perhaps design or client acquisition), what departments handle the middle (engineering, procurement, and production), and where does it end (distribution and feedback collection)?
- Collect crucial data. Gather data into a centralized repository to get a bird’s-eye-view on process performance, like cycle times, error rates, resource utilization, and client feedback.
- Analyze the data. Keep an eye out for patterns, trends, and areas in which workflows can be improved. Consult with leadership from all departments to gain insights from those who work in each department every day.
- Create benchmarks and key performance indicators (KPIs). If possible, gather industry data and compare where your company is against industry best practices and benchmarks. From there, you can set new KPIs to hit monthly, quarterly, and annually.
- Keep stakeholders in the loop. Insights from stakeholders will color the data. It also gives them a chance to provide feedback and suggestions. You’ll increase buy-in from employees by giving them a platform to help improve business processes, which will go a long way in change management when the time comes.
- Make recommendations. Use the compiled data to recommend new KPIs, processes, technologies, and other improvements.
- Implementation. Work with stakeholders to implement the new plan, monitor its effectiveness, and continue making adjustments as needed.
This business process review roadmap will work for any company. But what about manufacturers looking to upgrade their enterprise resource planning (ERP) system or implement their first ERP system? For you, we need to evaluate that it’s the right time and place.
How to Know It’s Time for a Business Process Review
If you’re a manufacturer, there are a few indicators you can look for to know it’s time to reevaluate your business’s processes. Here are some common signs that suggest it’s time to optimize your workflows and streamline development.
Your KPIs Were Up, But Now They’re Down
Successful businesses keep an eye on performance metrics, so let’s back up. If you’re not already collecting and monitoring data from every department, you need to start.
If you have been, then you might have noticed your KPIs stagnating or even declining. We’re talking about:
- Cost per unit
- Quality levels
- Returns or poor feedback from customers
- Production output
- On-time (or not-so-on-time) delivery
If these KPIs are declining or not meeting targets, it’s a strong indicator that your current processes need review and improvement.
Human Errors and Quality Issues
Does your business struggle with defects, errors, rework, or customer complaints? Poor product quality can indicate inefficiencies, gaps in the manufacturing process, or even employee discontent. Human error happens, but it shouldn’t happen often. Many businesses in Industry 4.0 are addressing this by automating workflows using smart technology.
Your Workflows Cause Bottlenecks
Imagine a plumbing system that uses the same size pipe for different water pressures. It’s going to cause backups, bursts, and bottlenecks.
If your business is struggling with delays and unpredictable outcomes, causing some departments to sit on their hands while others need to rush to make ends meet, it’s time to evaluate your business process.
Your Costs Seem Too High
Sure, your business may be affected by rising production costs, but there are steps you can take to lower costs elsewhere. For example, your business may be producing excessive waste, inventory inefficiencies, high maintenance costs, or high costs for a workforce that isn’t working.
Advancements in Technology Are Preventing You From Remaining Competitive
Is your competition running circles around you? Has your factory made any meaningful technological updates in the past 2 to 5 years? These two questions are correlated.
We’re currently in a stage of rapid technological development, lovingly referred to as Industry 4.0. That means manufacturing businesses like yours need to stay on the cutting edge of smart factory tech.
Fortunately, investing in your smart factory means that all of the above problems can be quickly and easily streamlined.
For example, the implementation of an enterprise resource planning (ERP) system means that data collection is automated, reporting is a breeze, and all users are working off the same data. It also reduces the risk of human error, increases safety, and improves employee morale by automating menial tasks, implementing approval processes, and streamlining workflows.
Using a Business Process Review to Evaluate ERP Needs
If you think it might be time to upgrade your software in one department, or rehaul your entire system, a business process review will give you the guidance you need to start taking steps in the right direction.
First, map your current processes. Conduct a detailed analysis of existing manufacturing processes, including production planning, inventory reduction strategies, procurement, supply chain management, quality control, human resources management, and financial management.
Use this map to identify pain points, bottlenecks, data silos, inefficiencies, manual tasks, and any other area which process integration is lacking.
Next, identify your business goals. What are your current growth objectives and how well are you scaling to meet them? Compare your existing processes to your goals and look for gaps. Look for:
- Agile decision-making
- Real-time visibility
- Data-driven insights
- Efficient resource use
Are you currently accomplishing these strategies on a day-to-day basis?
It’s more important than ever to adapt to the constantly changing business landscape to grow and scale. This can’t be done without the necessary technology. What constraints in your current processes are preventing you from increasing production volumes, expanding markets, or mitigating supply chain complexities?
You can’t grow your business if you aren’t making data-driven decisions. Especially if you’re intending to migrate your current data to a holistic ERP system, you need to work with your IT department to ensure your data is clean, accurate, visible, and integrated with reporting software. ERP systems are able to work with your smart factory IoT devices to collect and analyze data in real time.
Perform a cost-benefit analysis.Compare the benefits of ERP against the investment and ERP implementation costs. Look at total cost of ownership, ROI, payback period, and long-term value creation. An ERP consultant can help you conduct this assessment.
Find the Best ERP System to Launch Your Company Forward
At Godlan Consulting, we have 35+ years of experience helping manufacturers like you streamline their business processes and boost profits. We can help you conduct a business process review, select the right ERP system, and implement it quickly. Contact us today to learn more.
