How Business Process Management Saves Money

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Business process managementBusiness process management (BSM) is the discipline by which individuals utilize a variety of techniques to identify, plan, analyze, control, and optimize business processes. In business process management, there is a flow of activity: there are triggers, variables, standards; organizational rules and objectives etc. When these activities come together, it is referred to as a business process. Therefore, the entire business process is optimized by BPM.

There are many benefits to be derived from efficient BPM. Some of the benefits of good BPM are: better organization and better performance, less mistakes, improved employee experience, improved profitability, lower cost of ownership, ability to predict and prevent problems and failure, ability to reach goals and meet commitments. Furthermore, because of the variety of business processes that need to be performed and monitored, management often has difficulty keeping track of the activities of each department. In addition, if departments are not closely integrated, then the entire organization suffers. An effective BPM system will provide a framework for all departmental activities within an organization and a way by which these departments and activities can communicate with each other.

Many companies are looking towards automated systems and BPM to automate business processes such as accounting, customer service and HR administration. The key to making an automated system work is to put all the pieces of the puzzle together and have a common planning and controlling framework. When the parts work together, the result is usually more accurate, faster and more efficient than human intervention.

Automation of business process management reduces the time needed for thorough explanations of processes, controls, penalties or benefits, and documentation needed for regulatory compliance. When using an automated solution, there is no more need for in-depth documentation such as human-to-human descriptions and detailed business rules and regulations. For example, there is no longer any need to write business rules regarding the classification and processing of data or the creation and modification of payment slips or the scheduling of vendor payments.

There are two main benefits of business process management (BPM): speeding up operations and reducing costs. Although it is impossible to eliminate all bottlenecks, using a BPM solution can greatly reduce them, particularly in areas such as training, quality control, financial operations and human resource management. These are the core areas in which BPM saves money. It also helps to avoid paper-based documentation, which is extremely time-consuming, especially in large organizations.

Although it is difficult to eliminate all human resource processes – especially in an era of increasing worker productivity – business process management solutions can help human resource departments to improve their efficiency through processes such as recruitment, orientation and selection, induction and training, and selection and advancement of employees. Likewise, payroll can be automated through programs such as pay slip and automated deposit management. Another area where BPM can save money is the collection of payroll and taxes. Because human resource tasks have now been computerized, these processes have been automated as well, making it possible to complete these tasks without actually spending an employee’s time to perform them.