How do you measure and evaluate the impact of your Business Process Improvement efforts?

When embarking on improvement projects it is best practice to identify 3-5 metrics to include a process, outcome, and balancing measure. Since process measures are proximal they will help you to identify more quickly if the solution idea is working. If it is not, course correction may be needed. While the balancing measure will indicate whether other areas of the business are suffering as a result of time and resources being placed on the current project. Obviously, as a distal measure, the outcome measure will not be realized until towards the end of the project and will ultimately indicate the project's success/result.

Before useful metrics can be identified, the question, “What are we trying to accomplish?” must be answered. Answers to this first question should describe the desired end-state without any descriptions of how to get there or targets to achieve. Once that first question is clearly answered, the second question to address is “How will we know that a change is an improvement?” The answer to this second question provides the metrics that make it possible to evaluate progress along the way or arrival at the destination.

I agree with Tosha and Max. Usually, looking for a business metric that is being improved would be best. Before embarking on any project, it is essential to understand how the business is doing today and the impact of the proposed improvement on the KPIs and business metrics.

I find the Kirkpatrick model to adapt well to business process improvement. This model involves defining metrics at 4 levels of analysis: Attitudes, Knowledge, Behavior, Results. Together the metrics tell a comprehensive story about success and obstacles to achieving results.

Let's briefly consider a use case to understand what a balanced scorecard may include: Let's assume we're leading the digital marketing function of a SaaS business. First: include performance metrics in our scorecard. We're measured by revenue attributed to our efforts, but also by indicators of future revenue, like SQL's converted from MQL's produced in our various marketing efforts. So, our scorecard should include: $, MAL#'s by channel & campaign, MAL-MQL-SQL conversion rates. Second: we should line up our costs with those outcomes. For each campaign the scorecard should track: team time contributed, cost to build, cost to operate. Your balanced scorecard should be a snapshot of the efficacy of your BPI efforts.

Six sigma projects typically choose a single primary metric (“Big Y”) to improve so not sure a balanced scorecard makes sense in this context. You should also identify a secondary metric that you don’t want to harm. I would be skeptical of a project charter that said the project would be improving several metrics unless they are correlated somehow (e.g. booking rate and revenue).

A balanced scorecard provides a comprehensive framework to monitor a range of key performance indicators that reflect the outcomes of business process improvement initiatives targeting different strategic goals. Financial KPIs quantify metrics like reduced operating costs, transactional overheads and revenue gains indicating how a more efficient, higher-quality process impacts the bottom line over time. Customer KPIs measure the lift in experience through net promoter scores and retention rates. Process efficiency KPIs capture cycle time reductions, error rates and productivity enhancements.

To confirm that changes in performance indicators result from Business Process Improvement (BPI) efforts: Establish a Baseline: Document metrics before BPI to compare with post-BPI results, ensuring accurate measurement. Define Objectives and KPIs: Set clear BPI goals and relevant KPIs, such as cycle time or customer satisfaction, that directly measure intended improvements. Monitor and Compare: Track KPIs before and after BPI. Use control groups or benchmarks to isolate BPI effects from external factors. Analyze Changes: Compare pre- and post-BPI data, accounting for external influences. Regularly review data and feedback to ensure improvements are due to BPI efforts.

A balanced scorecard helps measure business process improvement by looking at different areas of the business. It checks financial results, customer satisfaction, internal processes, and learning and growth. By using this method, you can see the bigger picture of how your changes are working and how they affect the whole company.

Collect data before improvement efforts so that you understand baseline measures. Then measure immediately after improvement efforts and at regular intervals to note any gains. The key is to maintain consistency in the measures analyzed. If you look at different measurements before and after the effort, you can't be certain that your actions had any impact.

Collecting and analyzing data is the backbone of any successful Business Process Improvement (BPI) initiative. 📊 By leveraging diverse data sources—surveys, interviews, observations, and system logs—you gain a holistic view of your process performance. Use visual tools like charts and dashboards to uncover trends and correlations, and always benchmark against industry standards to measure your progress. Remember, data isn't just numbers; it's the story of your business's journey toward excellence. 🚀

I always create a data management plan with the objective of keeping everyone in the know about what metrics we are collecting, the source (e.g., survey) of the metrics, metrics' name, denominator and numerator, sample size info., and exclusion criteria to name a few elements. For those who are responsible for collecting the data we hold a meeting to define the metrics and to train on how the metrics should be collected. Doing so ensures a shared mental model and lends to the project's success. Using the order fulfillment example with an error rate measure, you want to ensure everyone involved is defining the measure the same, knows what the numerator and denominator are and understands how to collect the data.

In my experience, a key data element to include is the adoption rate. Late adopters due to change management issues may skew your early results and deflate the improvement metrics. Not all BPI's can shut down the old way of doing things completely. We need to account for delayed adoption and have an OCM plan to increase adoption and make it stick.

While not yet widely available in all variants of business processes, technological advances in this field have started surpassing the traditional method of defining and analysing metrics as a disparate function -- ergo, Enterprise Process Mining software. Imagine the ability to automatically capture processing throughout actual workflow paths that often cross multiple systems and dynamically visualize what is really happening in near real-time? This streamlines process analysis, eliminates the need for manual capture of metrics (high failure rate), and can discover unknown exception process paths. Now couple this with machine learning algorithms to synthesize process improvement recommendations? Welcome to the future of BPI.

Assessing the impact of business process improvements requires tracking key performance indicators (KPIs) like efficiency gains, cost reduction, and customer satisfaction. Analyzing before-and-after metrics, conducting surveys, and monitoring employee feedback offer valuable insights into the effectiveness of implemented changes. Regular assessments and feedback loops are vital for ensuring continuous improvement.

When launching a new business process, it is crucial to tailor your communication to each audience. Focus on how the change will affect their day-to-day experience, being transparent about any potential drawbacks. Building trust starts with showing you understand their perspective. Explain how the change will benefit them specifically. Use numbers or early adopter testimonials where possible to build credibility. Convey why this change is happening while also reassuring those affected that their needs are being considered. A win for one audience may be a drawback for another. Audience-centered communication makes organizational change far smoother.

Could you communicate and report results to gain further collaboration and trust that the BPI projects are working? The results should be shared with the right parties to create trust. Communicate and publish the results often, even if seems small. Those small wins add up to bigger wins. It will get other people excited and want to do so the same improvements within their business areas.

Beyond traditional channels, it’s important to consider embracing emerging technologies and interactive platforms to engage stakeholders dynamically. Some ways of data analytics and visualization tools can offer deeper insights into performance metrics and trends, empowering stakeholders to make informed decisions.

This is one area where most BPI programs fail. They only report on the initial outcomes. The most successful programs continue to measure to ensure the gains are held and that continuous improvement is continually applied. That is the key to maintaining a continuous improvement mindset.

If you are not the process owner, then it’s critical that you hand off the improvement to the right person so they sustain the gain. This is definitely where projects fail! Develop a control plan that pre-plans in the event of performance changes who will take what action. Be sure to provide enough time for these handoff activities to occur. There’s nothing sadder than seeing your hard work get abandoned by those who didn’t take ownership.

After finishing a project, gathering the team and users to reflect on what went well and what needs work is invaluable. This is often skipped or put off too long because the team sees the launch as the finish line. Voicing frustrations and critiques is key. The more forthcoming people are, the more the team can learn. Discuss not just the end product but also the process. Improvement necessitates honesty. It is worth the temporary discomfort to build a culture of trust. The first change is the hardest for those closest to the process but with the habit of retrospectives, you can make incremental improvements part of the culture.

Refining business process improvement requires establishing governance to systematically review initiative impacts and Enhance approaches. Each BPI project must measure agreed-upon metrics before and throughout implementation, with control limits to identify deviations. Continuous feedback loops with engaged stakeholders help collect qualitative data on what’s working versus needs improvement. Issues logs track enhancement opportunities and changes for future iterations within PDSA (Plan-Do-Study-Act) cycles. Controlled pilot testing on smaller groups contain risks.

To effectively communicate and report BPI results, tailor reports for different audiences—executives need summaries, while teams require detailed insights. Use visuals like charts and graphs to clarify data and trends. Highlight key findings by comparing pre- and post-improvement metrics. Provide context by explaining data collection methods and their business impact, addressing anomalies, and suggesting next steps. Regularly update stakeholders on progress, adjusting frequency as needed. Encourage feedback to refine processes and align with business goals.

Um dos principais erros sobre melhoria de processos é tratar o tema como um "evento único", como responsabilidade de uma só pessoa ou área, ou ainda ver isso de forma não integrada às demais iniciativas da organização. Para a real melhoria de processos, é necessário trabalhar cultura e fazer com que cada integrante do time entenda as pequenas mudanças que podem ser feitas e trarão melhores resultados. Ter em mente a pergunta "como podemos melhorar isso?" a cada momento é fundamental, e cabe a cada um de nós lembrarmos isso a nossos colegas e parceiros de trabalho.

What was not specified is that there must be specific KPIs required at each critical stage. These KPIs are defined before the project, during its course and most importantly at completion. As a consultant, these deliverables with specific measurements of pre-and post-change most likely drive the pay schedule. Speaking to clients, is also imperative that your changes be identified and measured on a regular basis and link this work to performance payment. Third, the business process improvement must include both the identified processes as well as those new processes that occur on a fast-track basis during the work. There must be a clear and workable plan to take this into consideration. These changes impact the primary process improvement.

Measurement of performance improvement is absolutely essential. Do not undertake a process improvement initiative without being able to point to a “before” and “after” picture! Forcing the metrics conversation helps suss out early on if you have support, and it also forces the discussion around the focus of the project. Gaining this alignment early on will set conditions for project success.

Benchmarks are crucial for measuring and improving processes. They help establish performance standards based on industry best practices, enabling you to set realistic goals. By comparing your performance with peers, benchmarks identify areas for improvement and reveal effective practices used by others. They also assess your competitive position in the market, ensuring your strategies are aligned with industry standards. Additionally, benchmarks evaluate the impact of implemented improvements, guiding necessary adjustments. Using benchmarks provides a clear, objective view of performance, aiding in continuous improvement and effective communication of results.

A comprehensive approach is required to measure and assess the impact of business process improvement efforts. It starts with defining key performance indicators (KPIs) tied to process objectives and the organization's strategic goals. Process data must be systematically captured before and after improvements are implemented, evaluated versus the KPI targets. This before-and-after analysis quantified through metrics like reduced cycle times, higher quality, lower costs, and improved customer satisfaction shows the efficiencies gained.