PROCESS IMPROVEMENT has always been the mainstay of organizations' attempts to enhance their overall performance, in part because it's much easier to reduce expenses and streamline processes than to increase revenue. Management approaches that focus on improving processes — Six Sigma, for example — significantly outnumber those that focus on driving revenue.

When businesses feel the effects of economic contraction, they tend to focus even more tightly on process improvement in the hope of “cutting their way to the top.” Yet embedding process improvements into an organization is notoriously difficult. Such efforts must show a positive ROI to carry conviction that they're worthwhile. The expenses they generate — employee time, training, consultants — are easily identified, but the dollar value of the improvements is not. How does an organization evaluate less tangible, but clearly significant, benefits such as improved decision-making?

The traditional answer has been to measure the outcome and value the improvement based on that. For most organizations, though, that's easier said than done. The connection between improvement and outcome is often muddied by multiple influencers, lack of clarity in process definitions, and cumbersome manual reporting. Yet measurement is crucial; if it's skipped, over time the organization will lose enthusiasm and move on to the next silver bullet.

To be effective, an initiative must address the two primary reasons why process improvements so often fail: First, prioritizing the processes often requires considerable effort. By the time the organization begins to make changes, so much time and money has already been spent that a positive ROI seems unlikely.

Second, once the changes are in place, it's hard to make them stick. Over time, people revert to what they've always done, and the improvement is lost.

Fortunately, both problems have a common solution. For organizations that have implemented business performance management (BPM), significantly improving the effectiveness of process initiatives and boosting ROI can be surprisingly easy. That's because the key to preventing failure — and the primary focus of BPM — is good information.

Identifying Opportunities

If BPM is in place, the work that's involved in prioritizing processes should already be done. The goal of process improvement shouldn't be simply to grab the lowest-hanging fruit (as is often the case); it should be to grab the lowest-hanging fruit that's most valuable to the organization. To extend the analogy a little, it does a restaurant no good to choose fruit that isn't needed for the dishes on its menu simply because it's readily available and cheap. It still has to pay for the fruit. It costs the organization resources to make any improvement. A BPM-enabled approach is in sharp contrast to most initiatives, which typically involve a long series of process definitions to uncover opportunities for improvement. BPM limits the scope to those processes most critical to overall success, streamlining the selection task.

It's easy to see how BPM can help with mainstream processes such as manufacturing or service delivery (applying “bottleneck” analysis), but it can be equally helpful with support roles. For example, if the HR department's hiring and on-boarding processes are crucial to the organization's success, then the BPM hierarchy of measurements should already include them.

Under the traditional approach, once you've defined your processes you have to benchmark them so that you can measure performance and, therefore, improvement. But the data-gathering and measuring processes in most organizations are cumbersome and manual. This is another problem that BPM capabilities can solve. The hierarchy of measures and metrics that appear on dashboards and scorecards can provide a baseline for performance prior to the improvement initiative, saving time and effort. If the specific metrics needed are not yet in the model, the process initiative provides an opportunity to add them.

Making Change Stick

Once the process improvement team moves on, process owners are left with the same resources they had prior to the initiative, but now they must also monitor the changes. Too often, they lack a mechanism that quickly reveals employee or process performance and provides a way to correct bad behavior.

Again, this is where BPM shines. By providing indicators that are attached to key metrics and updated weekly or even daily, BPM can help managers assess compliance and determine whether the changes are working as expected. Modifications can be made quickly so that the revamped process becomes the new norm.

BPM and process improvement initiatives are complementary in another way, too: BPM often struggles to show a positive ROI on “soft” returns such as better decision-making. By integrating process improvement and BPM efforts, companies can directly tie the BPM project's returns to those of the improvement drive.

BPM is synergistic with process improvement, just as it is with most organizational efforts, because it changes the very nature of how an organization manages itself. It places timely, fact-based information at the center of all decision-making, focusing effort on tangible results, driving tactical performance toward strategic goals, and creating competitive advantage. There can be no greater organizational improvement than that.

David F. Giannetto is co-author of The Performance Power Grid, CEO of The Telos Group and a professor in Rutgers University's executive MBA Program. You can reach him at dgiannetto@telosconsulting.com.