Business Process Analysis: Definition, Techniques, and Examples - Tallyfy (2023)

Business process analysis is an analysis method that helps to increase the efficiency and effectiveness of a process. It assesses how well the process achieves its end goal. Business process analysis identifies and examines every part of the structure, including the process itself, the participating parties, the information exchange, and others. Accordingly, it can help identify potential improvements within the process, making it easier to carry out a re-engineering initiative sometime down the line.

In most cases, business process analysis can be helpful with:

  • Finding the reasons behind systematic delays
  • Clearing out the “right” way of doing the process
  • Determining whether or not the process is operating at maximum potential capacity
  • Finding out whether the process should be improved or re-engineered

Business Process Analysis: Definition, Techniques, and Examples - Tallyfy (1)

Why You Need Business Process Analysis

Every business has to constantly evaluate its processes and think of how to improve them. As the time goes, new technology becomes available, making the as-is process obsolete or easy to improve. Or, the as-is process may be using up too many resources, or simply be inefficient due to outdated technology. This is when business process analysis comes in handy. It allows you to have a very thorough and detailed look at the process and its components and see how it can be improved.

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By using this optimization method, a firm can:

  • Clear up the documentation for the process. At some point, every business amasses a lot more paperwork about the process than it needs. Doing a thorough business process analysis helps sort out which parts of the documentation are still relevant and which can be disregarded & thrown away.
  • See if the process is expensive or wasteful. Nobody wants to have a process that eats up more resources than it should.
  • Find causes for inefficiencies and delays within the process. Some businesses may not even realize that a process is not working as it potentially could. Business process analysis helps to dissect the process into smaller chunks, making it easier to understand & analyze. This, in turn, makes it easier to understand if a process is underperforming & if it’s possible to be improved.
  • Uncover unnecessary risks within the process.

Overall, business process analysis allows you to study the processes in detail and examine them from different angles to improve efficiency. The data you obtain is useful to both assess how well the current processes are working and develop new ones.

How to Do Business Process Analysis

Business Process Analysis: Definition, Techniques, and Examples - Tallyfy (2)

Before you begin business process analysis, you first need to determine what do you want to achieve in the end. Business process analysis is often a step in a bigger initiative – business process management (BPM) or business process improvement (BPI). After all, once you’re done with the analysis, you probably want to do something with the findings, and for that, you need the right methodology.

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BPM is a methodology of continuous re-examination and improvement of business processes. BPI, on the other hand, means improving one specific process.

Business process analysis is a very critical component of both – you can’t change anything about a process, after all, without throughout analysis. Business process analysis gives you the data needed to find process weaknesses, possible improvements, as well as determine whether the said improvements are worth carrying out.

Whatever you choose as the end goal of your business process analysis, here are the five steps you need to follow:

1. Determine the process to analyze

Regardless of what bigger objective you are after, the first thing to do is to identify which process you are going to analyze. Typically, you would analyze business-critical processes. These would include processes that have a direct influence on the end product, revenue, expenses, and other critical components. You might also want to fix processes that you’re certain are underperforming. This would be an especially good choice if you want to carry out BPI.

On the other hand, you could also analyze a new process you recently implemented, as a means of ensuring that it’s working as intended.

When selecting the process to analyze, be sure to note the exact start and end point. Since processes can be really intertwined, your analysis might get messy and last forever.

(Video) Examples of Business Process Reengineering (BPR)

2. Collect necessary information

Once you’ve settled on the process, you need to collect as much information as possible to analyze it. In this step, your main goal is to go through all the sources of information about the process, be it skimming the documentation or interviewing the people involved.

Do not worry if it feels like you spend too much time on it or have too much information. Being thorough at this point of business process analysis will save your precious time in future.

3. Map the process

To be able to move on to the analysis, you have to put your findings into some structured form.

Business process mapping involves visualization of the business process. When mapping the process, your goal is to filter all the relevant information you collected and present it in a neat and structured way. Business process mapping allows you to clearly visualize the process you are dealing with and better understand the roles of various stakeholders. It makes it much easier to see what works and what doesn’t, what risks are associated with various components of the process, and generally see the big picture.

There are a number of ways to map a business process. You can go old-school and construct workflow diagrams and flowcharts. One benefit of this method is that it is available to anyone who can find a pen and a paper around or construct a diagram in MS Word. You can also use any of the common process mapping tools, be it a value stream map or SIPOC (Supplier Inputs Processes Outputs Customer) diagram, depending on your goal.

You can also up your game and use workflow software. Unlike the pen-and-paper option, the software allows you to keep track of processes in real time, seeing whether there are any holdups or delays. It also allows for some degree of automation, as the software itself is in charge of making sure that the process is completed in a timely manner.

(Video) What is business process

4. Analyze the process

Now that you have all the needed information, it’s time for analysis. With all the data you’ve gathered at this point, you should already have a clear idea of what you can improve. To find even more potential improvements, however, you can also ask yourself such questions as:

  • What are the most important components of the process? What is their impact? Would improving just these components alone be enough?
  • Are there any systematic delays or issues in the process? Can you see the reason why it happens? Is there a way to fix them? How big is their influence on the output?
  • Does a particular component of the process require too many resources? Is there a way to change it?

These are just a few of the questions to keep in mind. As you dig deeper, you will understand better what exactly needs to be taken care of.

5. Determine potential improvements

The point of everything you’ve done so far is to understand how you can make your business process better. Using your findings from the previous steps, you can sort out the flaws and come up with potential improvements.

The kind of improvements that would work for your business depends on your specific situation. There is no one size fits all solution, and you may need to go creative to come up with potential improvements. Make sure to keep in mind the long-term effects of any changes you’ll make – while something might seem amazing in the short-term, it might turn out to be disastrous down the line. For example, by improving process speed, you might have also doubled the defect risk rate, which puts you back on square one.

Depending on your findings, you might also decide whether you’re making small, modest changes to the process, or completely reengineering it. While the later might take more resources and time, the effects can be very consequential.

Conclusion

Business process analysis is essential in finding potential improvements within your processes, as well as for bigger initiatives such as BPM or BPI.

(Video) Building a Process Map

Now that you know how it works, it’s time to put it into practice – theory, after all, can only take you so far.

Give it a go, and tell us how it works out down in the comments section!

FAQs

What is business analysis process & Techniques? ›

Business process analysis (BPA) is a methodology that helps organizations deeply examine internal processes to find opportunities for improvement. BPA helps to identify processes that can be made more efficient or effective and to assess whether processes are set up to align with business goals.

What is a business process define with an example? ›

They are the processes that directly create revenue. Examples include: product manufacturing, order to cash process, and delivering products to customers.

What is process analysis and example? ›

Process analysis = sequence of related events to excplain how things work/ how things happen. Directive process analysis = how to do something step-by-step; directions for completing work (to make something). Examples: recipes, model kits, sewing patterns, etc.

What are the four techniques for data analysis? ›

Diagnostic Analysis, Predictive Analysis, Prescriptive Analysis, Text Analysis, and Statistical Analysis are the most commonly used data analytics types. Statistical analysis can be further broken down into Descriptive Analytics and Inferential Analysis.

What are the two types of analytical techniques? ›

Two sub-branches come under analytical chemistry namely quantitative analysis and qualitative analysis which can be explained as follows. These two methods form the backbone of many educational labs of analytical chemistry.

What are the 5 basic process types? ›

In manufacturing, process types can be considered under five categories of project, jobbing, batch, mass and continuous. A description of each process type is followed by some examples of where each process type might be used.

What are the four examples of processes? ›

A few examples of processes might include:
  • Preparing breakfast.
  • Placing an order.
  • Developing a budget.
  • Writing a work order.
  • Triaging a patient.
  • Cleaning a room.
  • Changing oil in a car.
  • Strapping down a truck.

What is a process give three 3 examples? ›

EX: Manufacturing – an product assembly process, a quality assurance process, a corrective/preventive maintenance process. Finance – an invoicing process, a billing process, a risk management process. Health – a medical assessment, a drug approval.

What are examples of processes? ›

First, a few examples of processes:
  • Cleaning the store.
  • Finding an email address.
  • Deploying software.
  • Customer profiling.
  • Onboarding a new employee.
  • Planning a wedding.
2 Aug 2016

What are the three types of BPM? ›

There are three main types of business process management, including:
  • Integration-centric BPM. This type of BPM is used between existing software systems, such as CRM, ERP and HRMS. ...
  • Document-centric BPM. This type of BPM is used when a document, such as a contract, is the basis of the process. ...
  • Human-centric BPM.

What are the 4 stages of the BPM? ›

Business Process Management is a systematic approach to understanding, improving, and managing an organization. It is generally accepted to have four phases: document, assess, improve, and manage.

How many types of BPM are there? ›

Learning the Different Types of BPMS

Traditionally, BPM Solutions are either human-centric, document-centric or integration centric. While the lines between the three different types are blurring more as the market consolidates, most of these tools continue to have a primary focus.

What are the two types of process analysis and give example for each? ›

There are two types of process analysis: informative and directive. In a directive how-to, you are instructing your readers to follow certain steps. This often involves addressing the reader directly with the imperative verb tense.

What are the examples of process analysis paragraph? ›

Informational process analysis essays tell about how something is done without giving directions to actually do it. Some examples of this type of essay might include how a hot dog is made or how a phase transition from a gas to a solid occurs.

What is an example of process management? ›

Examples of management processes would include, but are not limited to: Aligning the company strategically, defining the corporate mission statement or formulating corporate goals.

What are the 4 types of business analytics? ›

From here, we are ready to begin the first steps of data analytics.
  • Step One: Descriptive Analytics. Descriptive analytics is the step where we start to glean information from what we've gathered. ...
  • Step Two: Diagnostic Analytics. ...
  • Step Three: Predictive Analytics. ...
  • Step Four: Prescriptive Analytics.
22 Jul 2022

What are 5 methods of analysis? ›

Here are five methods of qualitative data analysis to help you make sense of the data you've collected through customer interviews, surveys, and feedback:
  • Content analysis.
  • Thematic analysis.
  • Narrative analysis.
  • Grounded theory analysis.
  • Discourse analysis.
9 Aug 2022

What are the three techniques in data processing? ›

There are three main data processing methods - manual, mechanical and electronic.

What are analytical techniques examples? ›

Basic and most widely used analytical methods / techniques include:
  • BCG matrix.
  • Brainstorming.
  • Benchmarking.
  • Gap Analysis.
  • Mind Maps.
  • Pareto principle, Pareto principle 80-20 rule.
  • Six Questions.
  • SWOT Analysis.
14 Feb 2017

What are the 7 analytical methods? ›

The 7 Most Useful Data Analysis Methods and Techniques
  • Regression analysis.
  • Monte Carlo simulation.
  • Factor analysis.
  • Cohort analysis.
  • Cluster analysis.
  • Time series analysis.
  • Sentiment analysis.
13 Oct 2022

What are Level 4 processes? ›

Level four: is the documentation of systems, instructions and procedures required to complete steps in the level three processes and shows inputs, outputs, associated steps and decision points. For example, specific steps necessary to cut a PO in the enterprise application would require a level four process map.

What are the 2 types of processes? ›

Basically there are two types of process: Independent process. Cooperating process.

What are types of process? ›

  • 1 Structured Process (Production Process) Structured processes can be production processes producing products and services. ...
  • 2 Case-type Process (Semi-structured, loosely structured) ...
  • 3 Research Process. ...
  • 4 Engineering Process. ...
  • 5 Artistic Process.
17 Jun 2021

What are the 3 types of business processes? ›

Business Process Design - Three Types of Business Processes
  • Operational process.
  • Supporting process.
  • Management process.

What is the 5 step business process? ›

DMAIC is an acronym for the five-step cycle used for process improvements. These five steps are: Define, Measure, Analyze, Improve and Control.

What is business process definition? ›

A business process is a collection of linked tasks that find their end in the delivery of a service or product to a client. A business process has also been defined as a set of activities and tasks that, once completed, will accomplish an organizational goal.

What are the main business processes? ›

Typically, key processes are operational processes that fall within the following buckets:
  • Developing vision and strategy.
  • Developing and managing products and services.
  • Marketing and selling products and services.
  • Delivering services.
  • Managing customer service.
30 Oct 2020

What is the best definition of process? ›

A process is a series of actions which are carried out in order to achieve a particular result.

Why is business process important? ›

The Importance of Business Processes

Business processes help keep your company on task, prevent errors, and increase the speed with which your staff can accomplish their work. Without defined processes, there's no way to guarantee that anyone does a task the same way twice.

What is BPM and its tools? ›

Business process management software (BPMS) is an enterprise-level software solution to automate repetitive tasks, manage fundamental processing, and handle process logics. BPM systems optimize and accelerate processes, increasing efficiency.

What is the purpose of BPM? ›

Business process management (BPM) is the practice of modeling, analyzing, and optimizing end-to-end business processes to help meet your strategic business goals, such as the improvement of your customer experience framework.

What are BPM tools used for? ›

BPM tools are used to design a systematic approach to optimize business processes. They are used to model, implement, and automate business workflows with the goal of improving corporate performance by minimizing errors, inefficiencies, and miscommunication.

What are the 5 stages in BPM life cycle? ›

The BPM lifecycle is considered to have five stages: design, model, execute, monitor, and optimise.

What are the 4 types of processes? ›

The main manufacturing process types are project, jobbing, batch, line and continuous. Project processes produce products of high variety and low volume. A feature of a project process is that the location of the product is stationary.

What are the 5 components of a business process? ›

If you can clearly define each of these five processes for any business, you'll have a complete understanding of how it works.
...
At the core, every business is fundamentally a collection of five Interdependent processes, each of which flows into the next:
  • Value-Creation. ...
  • Marketing. ...
  • Sales. ...
  • Value-Delivery. ...
  • Finance.

What are the 3 main business processes? ›

Business Process Design - Three Types of Business Processes
  • Operational process.
  • Supporting process.
  • Management process.

What are the 5 types of analysis? ›

5 Types of analytics: Prescriptive, Predictive, Diagnostic, Descriptive and Cognitive Analytics - WeirdGeek | Data analytics, Data analysis tools, Data science.

What are the 3 methods of analysis? ›

Diagnostic Analysis, Predictive Analysis, Prescriptive Analysis, Text Analysis, and Statistical Analysis are the most commonly used data analytics types. Statistical analysis can be further broken down into Descriptive Analytics and Inferential Analysis.

What are examples of business analytics? ›

Real-World Business Analytics Examples
  • Growing sales. ...
  • Developing marketing strategies. ...
  • Using predictive analytics. ...
  • Improving financial efficiency. ...
  • Increasing productivity through streamlined processes.

What is step 4 in the business analytics process? ›

Step 4: Prediction and Optimization

In today's era, Business Analytics is all about being proactive. In this step, you will use prediction techniques, such as neural networks or decision trees, to model the data.

What are Level 5 processes? ›

Definiton. - A level 5 procedure represents task level information, detailing how tasks are carried out manually by a process worker or automatically by the system. The level is a decomposition of a level 4 process/step. - A level 5 procedure map should contain 5 - 30 process steps.

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