Organizations are as efficient as their processes. Most companies have become aware of this and are considering how to improve them and avoid some common problems such as: low performance, poor customer focus, departmental barriers, useless threads due to the lack of global vision of the process, etc.
To continue, one of the protagonists of this article must be defined: a process can be defined as a set of interrelated activities that, from one or more inputs of materials or information, lead to one or more outputs as well of materials or information with added value.
In other words, processes is the way things are done in the company. Examples of processes are the production and delivery of goods and / or services, commercial management, strategy vision development, product development,… These processes must be properly managed using different process management tools.
The incorporation of the New Information Technologies allows to redefine the processes reaching unimaginable degrees of effectiveness and efficiency a few years ago. Organizations that are able to discover these possibilities and implement them correctly, will achieve competitive advantages due to the reduction of costs and the increase in flexibility in relation to customer requirements.
Business processes must be properly managed using management information systems (ERP Enterprise Resource Planning in English). An information system for ERP management can be defined as a business management application that integrates the information flow, thus managing to improve processes in different areas (financial, production, logistics, commercial and human resources).
The main objectives of ERP systems are:
- Optimization of business processes. Access to reliable, accurate and timely information. The possibility of sharing information among all the components of the organization. Deletion of data and unnecessary operations. Reduction of time and process costs.
Regarding the processes that have opportunities for improvement, in any process in which there are exchanges of information, the impact of New Technologies will be very important, so much so that it will completely redefine the process. It is because all the information can be "digitized" and therefore managed automatically using the Information systems and can be communicated at zero cost using the networks (Intranet, Extranet and Internet).
Clearly, all processes that are fundamentally based on exchanges of physical goods will have far fewer opportunities.
Let's look at two areas in which important exchanges of information are generated: customer relationship management and supplier relationship management.
Customer relationship management:
In the area of customer relations, there are many opportunities for process improvement: consultation and presentation of information to customers, automation of the sales force, monitoring of communication actions, personalization of messages, preparation of personalized offers and many others.
For example, it is usual to prepare offers based on certain parameters defined by the client.
With an application through the Internet in which there is a form that asks for the basic data for the preparation of the budget and which is accessible from the website of the company, the client, by entering his identification, can prepare his own budgets.
In addition, by entering the identification, the system knows the rates and discounts that apply to that customer, offering them their final price.
Let us think as a practical case in the elaboration of a budget of a graphic industry.
To prepare the budget, you need data on the number of pages, number of colors, paper quality, etc. Traditionally, there is one or more people who are in charge of collecting this information from the client and entering these data into the company's information system, which generates a budget.
Obviously, the information system takes into account the customer's profile to apply one or the other discounts.
In this sense, this application can be made directly accessible through the Internet so that it is the same client who develops the budget and thus the people who develop this function can focus on more important areas developing this sub-process of a automatically.
With this, two important objectives are achieved:
- The reduction of costs since this process is carried out at zero cost compared to the costs that it would have in the event that it had to be developed by someone from the company. The possibility that the client has more information about the budget and is more transparent for him being able to make a sensitivity analysis of the different parameters.
Supplier relationship management:
Another important possibility in improving your processes using New Information Technologies is the possibility of sending information quickly through the value chain. With these technologies, it is possible to know in real time the production planning of suppliers by directly consulting their information system, managing stocks jointly with production and supplier stocks, knowing the status of an order, improving joint logistics management, etc.
As a practical example, the typical administrative process of payment management and the opportunities for improvement in each of the phases can be analyzed:
- 1. Control of entry and registration of receptions: incorporation of technologies to facilitate the collection of information and introduction to the ERP so that it can validate that a purchase order actually exists and that it meets the defined specifications. Invoice registration: introduction of invoices automatically from the provider's ERP via the Internet.
In this sense, it is where security and digital signature have to play an important role in order to allow the possibility that, directly through the issuer's ERP, the latter may send invoices over the Internet. Thus, the customer's ERP receives the invoices directly, avoiding a large number of processes that do not add value such as the printing of the invoices by the issuing party, sending them to the client, receiving the invoices at the client and introducing them in the customer ERP.
- 3. Payment authorization: using a workflow management system. A workflow system supports and controls the execution of a process or subprocess based on previously defined rules. In this case, it enables automation of the internal payment authorization process.
Rules are defined in the workflow system that help to manage information internally in the event that authorization by a person is required (which would also have been defined in the workflow system).
In this way, it can be defined that depending on the purchase amount and the type of purchase, one or the other person authorizes it automatically.
Thus, the ERP would simply know what type of material it is and the amount, and an email would automatically be sent to the person or people who had to authorize the process, greatly simplifying the thread.
The workflow system has many possibilities in processes like this in which different departments intervene and it is more important if these people are physically distant.
Payment: possibilities in the automated exchange of information between supplier, client and financial entity.
As discussed in the invoice registration process, communication between ERPs through the Internet offers many possibilities in the automation of this area.
The improvements that can be obtained in this process / thread are:
- Improve the performance of the process minimizing the use of paper and therefore facilitate the management of internal information using the ERP. Improve the communication between supplier, customer and financial entity in the process.
As it can be seen, the possibilities of the New Information Technologies are very important. The problem that exists in the implementation of such a system is that it is necessary to consider the four basic elements: strategy, processes, technology and people. If the four elements are not considered, the project will be a failure.
In a project of this type, the culture of the organization must be taken into account, a study of processes (and possibly process reengineering to be able to exploit all the possibilities), analyze the different technological solutions and that all these concepts are aligned with corporate strategy.
