Management and improvement of business processes
Theoretical considerations about Process Management
The modern business world requires that organizations, regardless of their size, sphere of action and type of property, carry out their activities efficiently and effectively; as conditions, not sufficient, but necessary to manage to stay in the business in which they participate. However, to achieve this at present, it is required, as a new paradigm, that entities be managed following the process approach or more commonly known as process management.
But: What is Process Management? How does it affect the analysis and results of the organization? The present work answers these and other questions, which address the following aspects: process definition; identification of the key processes of the organization; techniques for the representation or visualization of the processes; methodology for the analysis and improvement of processes; and application to a case study of the methodology for the analysis and improvement of processes.
Vale emphasizes that Process Management is the philosophy on which modern approaches to Quality Management are based, that is, ISO 9000: 2000 and Total Quality. For this reason, it can be affirmed that Process Management, more than a cognitive curiosity, is an imperative need for organizations that seek success and competitiveness through quality.
A key idea that is worth highlighting, from the start, is the one that indicates that a process can start and end within the same functional area, but also, and it is very common, that a process starts in a functional area and ends in another, therefore, a process can use resources from different subsystems within the entity. This undoubtedly constitutes a very important element of Process Management.
Process definition.
Of the process definitions, collected in the specialized literature, one of the most logical, simple and current is what conceptualizes it as "a sequence of activities that aim to achieve some result, generally creating added value for the client" (Evans and Lindsay, 2000: 341).
Another interesting definition of process is the one that refers to “a process involves the use of an organization's resources to obtain something of value. Thus, no product can be manufactured and no service can be supplied without a process, and no process can exist without a product or service ”(Krajewski and Ritzman, 2000: 89).
In general, from the process definitions they can be extracted as basic ideas that constitute a set of interrelated activities, that pursue the creation of value and that their final output is the conformation of a good or service for a client that may be internal or external to the organization.
Other definitions that conceptualize a process are the following:
- Process: action or succession of regular continuous actions, that occur or are carried out in a defined way, and that lead to the fulfillment of some result; a continuous operation or a series of operations. (Dictionary of the Royal Spanish Academy). Process: A series of systematic actions aimed at achieving a previously defined objective (Juran page 151). Magáz (1999): Defines processes as a value chain, through their contribution to the creation of a product or the delivery of a service. Each step of a process adds value to the previous step and thus until the last step of the same, in which the external or internal client receives the requested product or service. Shaw (2000):It defines that a process is a series of activities related and executed with logic to achieve specific results. Galloway (1998): Defines processes as a sequence of steps, tasks or activities that convert inputs into outputs. Josy (2003): Processes are groups of activities and tasks that together deliver value to the customer, involve many people and departments and transform inputs into outputs. These are customer and results focused. The series of ISO 9000: 2000 Quality Standards in section 3.4.1 define a “Process” as: “A set of mutually related or interacting activities, which transform input elements into results”.
The value chain scheme devised by Professor Michael Porter of the Harvard Business School is one of the best-known administrative models, this refers to processes as chains.
CLASSIFICATION OF PROCESSES
The methodology presented here constitutes the result of the practical experience of applying it in a group of selected companies such as: National State Insurance Company (ESEN), SIGNO Furniture Company, Aguas de la Habana Company and Ingelmo Shoe Company. It is precisely this last entity that will be taken as a reference to show all the logic of the applied procedure, whose steps are as follows:
1. Identification of the key processes of the organization.
2. Preparation of the Process Map of the entity.
3. Preparation of process charts.
4. Analysis of the processes.
5. Proposals for improvement.
6. Preparation of control charts.
7. Proposal of indicators to measure the performance of the improved process.
Identification of the key processes of the organization.
The identification of the key processes of the organization has the purpose of defining or specifying which are the processes that determine the entity's reason for being, that is, to indicate those processes that support the mission of the organization. To comply with this first step, the participation of the board of directors, specialists of the entity and some employees who know the organization in depth is essential.
In the practical experience developed at ESEN, in Aguas de la Habana and at the footwear company Ingelmo, the stakeholders mentioned in the previous paragraph participated in the selection of the key processes. Thus, for ESEN, the processes of Concertation and Claim were defined as key; In Aguas de la Habana, the processes of Water and Sanitation Services and in the shoe company Ingelmo, the processes of Purchase of supplies, Manufacturing and Marketing were established as keys.
These key processes are those that must be reflected in the organization's Process Map.
Preparation of the Process Map of the entity.
The conformation of the process map is a complex activity that requires the involvement of the group of people who were involved in the previous step. One of the most practical ways to prepare the process map is to carry it out on a label or acrylic board and ask the participants to observe what is being done and to express their criteria of conformity or not in relation to what who is conforming. With this work philosophy, the following process maps of Aguas de la Habana and the footwear company Ingelmo were made.
As you can see, the Map begins with customers, those who have expectations regarding the organization and ends with customers, since they hope to satisfy their needs once they receive the product or service provided by the entity.
The symbology used in the preparation of the process map should only be that of rectangles and directional arrows, since this makes it easier to understand and understand, at a glance, the content of this valuable document.
The Process Map must be shared by all members of the organization. This commits all the members of the entity to the fulfillment of its reason for being.
It is very important that the entity establish the necessary channels or design the means to obtain the feedback information that allows it to know what the clients' expectations are regarding the quality with which the key processes are developed; To do this, you can design surveys, interviews or other means that allow you to monitor this purpose.
For all that has been pointed out so far, it must be understood that the elaboration of the Process Map, rather than the task of some, is the responsibility of all.
Applying the same philosophy discussed above, the process map of the footwear company Ingelmo was prepared. The result of all the work crystallized in the following Process Map:
The culminating step in relation to the elaboration of the Process Map consists of its presentation and approval by the entity's authorities.
Finally, it is important to highlight that the Process Map must be reviewed every certain period of time in order to keep it updated.
Preparation of process charts.
Once the process map has been drawn up, it is appropriate or recommended to draw up the process charts. Two basic techniques for representing and analyzing processes are flow charts and process charts.
Flowchart. "The flowchart describes or shows the flow of information, customers, employees, equipment or materials through a process" (Krajewski and Ritzman: 2000: 112). They have the advantage that they are simple to elaborate and show all the activities that make up a process sequentially, which makes it easier to detect those essential operations to achieve success and those in which the most frequent failures occur or in which time is consumed. needlessly.
Without a fixed rule on the matter, diagrams are usually made simply with boxes, lines and arrows. No more details about this technique are offered due to the fact that in practice the authors of this work have used process charts more, considering the latter more universal and easier to apply.
Process charts. A process chart is an organized way to record and represent all the activities a person performs at a station or work area, while developing a product or providing a service to a customer.
The activities in question are usually grouped into six categories, namely:
- Operation: Represents a task or activity that creates, modifies, or adds something. Transportation: Move, move or transfer the object or client from one place to another. Inspection: Review or verify something, but make no changes. Delay: Occurs when the object is stopped waiting for further action. Warehouse: Occurs when something is set aside for later use. Combination: When the union of two or more activities occurs.
The information that results from developing the process charts is usually summarized in a table whose typical format is as shown below:
|
Activity Number |
Time minutes |
Distance (Feet) |
Operation |
Transport |
Inspection |
Delay |
Warehouse |
Description of the step or activity |
| Totals |
Totals
As in the case of the elaboration of the Process Map, the graphs require the consensus and participation of the people who work directly in the process under study.
In the case of the company Ingelmo, the process graph of the Preparation of Cuts area was prepared, which is presented below:
Process analysis.
Once the process charts of each of the sub-processes that make up the key processes of the organization have been prepared, they are analyzed in order to identify possible areas for improvement.
For this purpose it is recommended to use the methodology proposed and applied by the world-class company Motorota.
Methodology for the analysis and improvement of organizational processes
The methodology designed by the company Motorota proposes: “to develop an analysis of any process following the value chain, that is, the addition of value to the product, as it passes through the different phases or activities that make up a process or a Sub-process is recommended to use the methodology, the essence of which is to answer the following list of questions ":
1. Are all the steps of the process organized in a logical sequence?
2. Do all the steps add value?
3. Can some of the steps be removed to improve quality?
4. Should some steps be added in order to improve quality?
5. Should some steps be reordered?
6. Is there proportionality between each of the steps that make up the process?
7. What skills, equipment and tools are required in each of the process steps?
8. Should some steps in the process be mechanized or automated?
9. At what point should quality be measured or controlled?
10. At what point in the process can the most frequent errors occur?
As you can see the questions are clear, simple and very logical. According to the experience of the authors, in order to apply the methodology and obtain effective results, it is required that, once the graph of the process to be analyzed has been prepared, all the workers who are involved in development are brought together of the same and that it proceed, together with these, to ask each of the questions that make up the methodology. From this it is inferred that this is and must be a team effort where the direct worker or the employee play a transcendental role. The answer to each question should be obtained, if not by consensus, by a large majority.
Application of the methodology in the cutting process of the footwear company Ingelmo
Following the aforementioned guidelines, we proceeded, together with the workers of the cutting area of the footwear company Ingelmo, to apply and answer the questions of the methodology. Such results are shown below:
| Questions of the methodology | Answers |
| 1. Are all the steps of the process organized in a logical sequence? | YES |
| 2. Do all the steps add value? | NO |
| 3. Can some of the steps be removed to improve quality? | YES |
| 4. Should some steps be added in order to improve quality? | NO |
| 5. Should some steps be reordered? | NO |
| 6. Is there proportionality between each of the steps that make up the process? | YES |
| 7. What skills, equipment and tools are required in each of the process steps? | Acquaintances |
| 8. Should some steps in the process be mechanized or automated? | YES |
| 9. At what point should quality be measured or controlled? | Die Cutting and Breakdown |
| 10. At what point in the process can the most frequent errors occur? | Die Cutting and Breakdown |
Process improvement proposal
The application of the methodology led to the introduction of important changes and improvements in the Court process; changes and improvements that are explained below:
1st. Eliminate the operation Mark the leather pieces by hand (operation No. 4).
To eliminate the operation Marking leather pieces by hand, it is necessary to place marks on the dies themselves, that is, each die will have the mark corresponding to the number or size of the shoe. In order to better understand what is being explained, it is worth noting that the marks or notches are spikes or shells whose quantities and shapes vary depending on the size and type of footwear.
For example, for men's footwear, these could be:
The advantages of the identification marks or notches being placed on the die itself lie in the fact that it reduces the possibility of errors, since when checking the dies once there is no more coverage to carry out incorrect markings; In addition, footwear does not suffer because it is no longer necessary to write its size number on the cut pieces. As a consequence of all this, it will not be necessary to use the special pencils required up to now in this process. In addition, the use of manual labor force that has been used to carry out this activity is avoided. The economic evaluation of this proposal, in which only the direct effect is taken into account, generated by replacing the operations of marking the leather and lining pieces, leads to savings, for batches of 20,000 pairs of footwear, of 25 UmTaking into account that 1.5 million pairs of footwear are produced annually in this organization, the savings are much more attractive.
2nd. Delete operation Mark lining parts by hand (operation No. 2).
Following the same logic and using the arguments that support the removal of the Marking leather pieces by hand operation, we proceed to propose the elimination of the Marking pieces of lining by hand operation. As in the previous case, the economic valuation of this proposal produces savings, for batches of 20,000 pairs of footwear of 28 Um. It is evident that for volumes of 20,000 pairs, this figure increases significantly.
3rd. Introduce the operation Folear lining.
To carry out this operation, it is required that the daily production of the cutting area be organized according to plans; plans that are identified by a four-digit number plus two final digits. These digits mean the following:
First digit: Last number of the current year.
Second digit: Number of the quarter of the year.
Third digit: Ten of the month.
Fourth digit: Day of the corresponding ten.
Final two digits: Shoe size.
For example: What will be the meaning of a foliated shoe number equal to 4324 - 25?
Well, it would read like this:
4: Year 2004.
3: Third quarter of the year. (July August September).
2: Second ten of the quarter. (July 11 to 20).
4: Done on the fourth day of the decade of July. (July 14).
25: Shoe size.
In practice, these numbers are engraved on the shoe lining, generally on the inner heel, which allows, together with the production control, to identify at any stage of the process: Cutting, Preparation, Assembly, Packaging and Warehouse that the worker carried out the operation, which makes it easier to detect the person responsible for the poor quality that has been generated in the cut.
Made all the suggested modifications, the production flow would be as shown below:
Productive flow proposed for the Cut.
Elaborated and designed with the participation of the author.
Preparation of control charts.
Once the process has been improved, it is essential to observe or monitor its behavior, for which the use or use of control charts or control charts is recommended.
Control charts
Control charts are graphs that allow observing and analyzing the behavior over time of a product, or of a process, in order to know whether or not said product or process is under control.
The typical shape of a control chart is given by three parallel lines at equidistant intervals. The central line (LC) shows the average of the variable that is being analyzed; while the other two lines, upper and lower, to the center line, are called the upper control limit (LCS) and the lower control limit (LCI).
If in a process all the observed values of the analyzed variable are within the limits, statistically determined, then it is accepted that the process is under statistical control. If, on the other hand, at least one point is outside the limits, this constitutes a sign that the process is out of statistical control, so it is necessary to investigate what is the cause of this special change in the process.
A central aspect when preparing a control chart is the location of the control limits; because if these are too narrow (one standard deviation from the mean) you run the risk of saying that the process is out of control when it really is not. You react to a special cause that doesn't really exist.
If, on the contrary, the limits are located too far from the central line (three standard deviations from the mean), you run the risk of saying that the process is under control when it really does not happen. In this case, one would stop acting before a special cause that actually exists.
A simple and usual way to establish control limits is from the relationship between the mean and standard deviation of a variable. In case the variable x follows a normal distribution, with mean mx and standard deviation sx, the center line (LC) and the upper control limits (LCS) and lower (LCI) will be given by:
LCS = u x + ko x LC = u x LCI = u x - ko x
In this case, k represents the number of standard deviations from the mean; value that may be 1, 2 or 3; and that it will be selected depending on the characteristics of the product that is being analyzed.
Types of Control cards
Two basic types of control charts are recognized: for variables and for attributes. Variable charts are used when the quality characteristic to be controlled is continuous; for example: weight, length, resistance, temperature, etc. The charts for the most common variables are: Xx (of averages); R (for ranges); S (standard deviation) and X (of individual means).
These types of charts are applicable to manufacturing processes or discrete services; where the principle of independence in the value of the analyzed variable is fulfilled.
In relation to charts by attributes, it is worth saying that these are applied when the product being analyzed is judged as compliant or non-compliant, depending on whether or not it meets certain requirements. The control charts for discrete variables most used in practice are: p (proportion or fraction of defective items), np (number of defective units), c (number of defects for samples of constant size) and u (number of defects for each unit that integrates the analyzed sample).
Although the types of graphs, for variables and for attributes, are widely discussed in the specialized literature, here we will refer in more detail to graphs by attributes; precisely because these graphs can be applied to control processes in footwear companies. This is because footwear, at any stage of its operations process, is classified based on attributes as conforming or non-conforming.
The logical idea for the selection of a control chart by attributes is summarized in figure 1, on the next page.
Although it is not much commented in the specialized literature, in the letters for attributes, a very important distinction is the one that corresponds to the terms defective and defective. A defect is a quality characteristic that does not comply with what is established. A defective item is one that does not comply with the established parameters. It may contain one or more defects.
Interpretation of Control charts
If the correct selection and elaboration of the control chart is important, its correct reading, analysis and interpretation are also important. In this sense, the following recommendations are valid:
1. When analyzing a graph, the points should not be considered as isolated observations, but as a distribution of the process of which they are part (Ishikawa, 1994).
2. If the points fall within the limits, in principle the process is considered to be in a controlled state (Ishikawa, 1994).
3. If some points fall outside the limits, the process is considered to be out of control (Ishikawa, 1994).
Figure 1. Logic for the selection of a graph by attributes.
Source: Adapted from Evans and Lindsay, 2000: 693.
4. A significant change in the behavior of the process is considered to have occurred when any of the following seven tests is met (Gutiérrez, 1997: 163–172).
Test 1. A point outside the control limits.
Test 2. Two of three consecutive points very close to the LCS.
Test 3. Quarter of five consecutive points very close to the LCI.
Test 4. Eight consecutive points on one side of the Central Line.
This fourth test is very important when applied to an attribute card. Here, if the eight consecutive points are below the Central Line, then there has been a definitive reduction in the average level of defective parts generated by the process; the opposite will be true if the eight observations are recorded above the Central Line. Test 5. Six consecutive ascending or descending points.
If this occurs, there is no doubt that we are in the presence of non-random behavior, and therefore before a process that may be affected by some special cause of variation.
Test 6. Fourteen consecutive points alternating between highs and lows.
Test 7. Fifteen consecutive points concentrated around the center line.
When any of the seven previous tests is positive, we can affirm that the process is out of statistical control; This means that a special cause of variability has been detected that has affected the performance and stability of the process.
For the specific case of the area or cutting process, the letters that are recommended to be used are the letters p, np and u.
Proposal of indicators to measure the performance of the improved process
The indicators to measure the performance of the improved process will be defined depending on the type of process and the characteristics of the good or service obtained as a result of said process; thus, for example, indicators can be defined according to the saving of time or the decrease in the units or the defective production volume. In the specific case of the cutting process, the improvement introduced in it was evaluated based on the decrease in non-conforming production levels that were obtained before introducing improvements to the process in relation to the results of this indicator once the improvement proposals.
Before introducing the improvements, the production levels as generated by the cutting area was 93%; after the improvements were introduced, production levels rose to 97%.
Final thoughts.
The implementation of process management in organizations has become a necessity for entities seeking constant customer satisfaction, while pursuing continuous process improvement. However, despite the abundant literature on management by process that can be consulted, it does not appear, with the same frequency, how it should be implemented in an organization or how to proceed to improve processes.
The authors' practical experience, validated in companies in different spheres of action, shows that following the steps explained in this work undoubtedly helps in the analysis and improvement of processes, as well as the implementation of process management.
The steps of the methodology designed and applied by the authors are summarized in the following seven steps:
- Identification of the key processes of the organization. Elaboration of the Entity Process Map. Preparation of the process graphs. Analysis of the processes. Improvement proposals. Preparation of the control graphs. Proposal of indicators to measure the performance of the process. improved.
The analysis and improvement of the processes requires the involvement and active participation of those who work or participate in its development, since it is precisely they who know where the process improvement reserves may be.
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