Creating a Goal-Oriented Plan for Business Process Automation

Creating a Goal-Oriented Plan for Business Process Automation

“What’s measured gets managed” Peter Drucker’s business management adage seems more relevant today than ever before

“What’s measured gets managed” Peter Drucker’s business management adage seems more relevant today than ever before. In a world drowning in data and key performance indicators, where technology and automation solutions have become more cost effective and easier to implement, the decision of WHAT to measure and how to best manage it is critical.

When it comes to business process improvement, the first two hurdles faced by most companies are 1) achieving a clear definition of existing processes and 2) defining clear goals that should be achieved as a result of process refinement or automation.

It’s easy enough to agree that a process should be faster, easier and cheaper. But how do you measure “faster?” And how cheap enough is “cheaper”? And who decides what is easier?

Start with What You Know

Often trying to envision and map out a process from scratch can be intimidating for process owners. At the same time, one of the biggest hurdles to initiating ANY business process automation project is understanding the existing process in clear enough detail that anyone outside of the process can grasp it.

  • Get input from ALL stakeholder: When mapping out existing processes, make sure to get input from ALL stakeholders in the process. Don’t assume that one person knows all of the nuances, even if it’s a minor step.
  • Identify any and all exceptions: When it comes to process automation, the devil is in the details and all those things that fall outside the lines.
  • Picture it: Whether you rely on sophisticated process mapping tools, basic flowchart tools like Visio or Post-it notes, document your process in a way that are easy to visualize and easy to modify.

With a fundamental understanding of the process as it works today, the next step should be quantifying that process in a way that allows you to establish goals for improvement that can be measured and optimized.

Let’s take accounts payable as an example. When looking at your existing AP process and benchmark automation improvements, here are some metrics to consider:

  • Amount of time taken to receive and approve invoices
  • Amount of time required from AP and IT to manage the system and processes
  • Percentage of invoices ready to be paid on time
  • Number of suppliers on-boarded
  • Number of invoices received electronically
  • Amount of time required to resolve invoice disputes
  • Amount of time required for exception handling

Establish goals that are SMART

While Business Process Automation projects have become more cost effective and easy to implement, they still require an investment and a commitment of time, money and attention to execute successfully. Measuring return on investment and demonstrating measurable success can not only ensure an ongoing commitment to the initiative, but it can impact how ready the company might be to continue to optimize other processes through automation.

With that in mind, establish clear, measurable, agreed upon goals is key. Ideally you want goals that are SMART:

S - specific, significant, stretching

M - measurable, meaningful, motivational

A - agreed upon, attainable, achievable, acceptable, action-oriented

R - realistic, relevant, reasonable, rewarding, results-oriented

T - time-based, time-bound, timely, tangible, trackable

Make Sure That BPA Goals Align with Company Objectives

Sometimes, when focusing on a departmental process and looking for meaningful metrics, teams lose sight of the greater goals of the company and how the BPA project aligns to it.

Again, let’s use accounts payable as an example. According to recent Ardent Partners cross-industry survey, the top 3 metrics AP & Procurement departments say are important include:

  • Invoices paid on time
  • AP processing time and backlog
  • Days payable outstanding

On the other hand, CFOs surveyed by Ardent, when looking at AP performance consider:

  • Volume-based metrics (number of invoices processed)
  • Payment metrics (number of payments made)
  • Financial metrics (rebates earned, early pay discounts taken, etc.)

There is some overlap here in terms of metrics, though the perspective is clearly different. At the same time, CFOs look at other quantitative and qualitative data that does not align, including:

  • Internal stakeholder feedback and surveys
  • Department budget performance
  • Process, regulatory or financial compliance metrics

So, when looking for metrics, you may want to go BEYOND the process itself and make sure to examine its impact on the organization….including impacts to customers, partners and other stakeholders.

Goal Forth and Conquer

With clear goals in mind, your team can begin the process of mapping out the journey from the way things used to be to the way they should be, with confidence. Later in Q1, we’ll discuss how to analyze your business processes in detail, so you can go beyond simply automating a process as it exists to radically streamlining and improving the steps along the way.


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