How do Business Processes Generate Value?

1. How do Business Processes Generate Value?

2. Business Process • One of the first people to describe processes was Adam Smith in his famous (1776) example of a pin factory.

3. Business Process • A business process is a network of activities that generate value by transforming input resources into output resources • The cost of the business process is the cost of inputs plus the cost of activities. • The margin of the business process is the value of the outputs minus the cost.

4. Business Process • Business Processes are designed to add value for the customer and should not include unnecessary activities. The outcome of a well designed business process is increased effectiveness (value for the customer) and increased efficiency (less costs for the company).

5. Business Process • A Business Process can be broken down into several sub phases. , which have their own attributes, but also contribute to achieving the goal of the super-process. • A Business Process can be viewed as a flow chart.

6. Business Plan

7. 3 Types of Business Processes • Management processes, the processes that govern the operation of a system. Typical management processes include "Corporate Governance" and "Strategic Management". • Operational processes, processes that constitute the core business and create the primary value stream. Typical operational processes are Purchasing, Manufacturing, Marketing and Sales. • Supporting processes, which support the core processes. Examples include Accounting, Recruitment, Technical support.

8. Business Process in Conclusion • A business process begins with a customer’s need and ends with a customer’s need fulfillment. • The objective is to make the customer happy while cutting the company cost. In the end both sides are happy.