An internal process is an integral part of your company’s foundation. Continuous improvement of your internal process could be the difference between a company with employees that complete tasks promptly and one that fosters an unhealthy response from employees to responsibilities.
When you have a clear set of goals, making the necessary changes and keeping track of progress is easier. However, poorly designed internal processes could lead to chaos where it’s difficult to manage or understand tasks, ultimately wasting time and resources. So, how can you improve the internal processes in your organization?
Here’s a look at what you need to know about internal processes, including types, the importance of improving them, and practical steps to improve the internal operation of your organization.
What is an internal process?
Internal processes refer to those business processes performed within an organization without external influences from business partners. These processes serve as the foundation of a company but are unfortunately often overlooked by organizations as they don’t seem important at first glance. However, this is far from the truth.
This process is made up of a set of steps that will be followed to complete specific responsibilities within a company. This is the most crucial part of any internal process – achieving a specific task without external interference from stakeholders like vendors or customers.
Improving your internal processes can speed up the journey toward accomplishing your business goals. These can be designed by managers in line with the aims and objectives of the organization. In designing your internal processes, you should develop them with your broader strategic plans in mind and bring employees along to make the transition as smooth as possible.
Internal processes are great for measuring your company’s performance over a certain period and identifying potential issues with your current strategy. Consequently, you can correct these problems, increasing productivity and reducing resource waste.
Some examples of internal processes are processes that govern how decisions are made within the organization, how employees negotiate with each other and customers, the organizational culture that governs how employees work together, and training opportunities within the company.
Types of internal processes
Internal business processes are categorized into four major types. These are the operation management process, the customer management process, the regulatory process, and the innovation process. Here’s an overview of what they entail.
Internal company operation management
These are the daily actions or processes an organization takes internally to create quality products or services for customers. For example, the internal company operation management for an online store would be accepting, processing, and delivering orders, while that of a wholesale furniture company could be securing raw materials from a supplier, transforming them into furniture, and distributing them to retailers.
So, what is the purpose of internal company operation management?
- To limit exposure to market volatility
- To maximize business profit
- To reduce the time spent on processing materials for production
- To minimize the risks involved in the marketplace
- To increase the efficiency of resources
Customer management process
Any program that assists an organization in providing assistance and advice to customers who buy or use their products is referred to as a customer management process. To manage the queries, you will need a top-notch internal process on how to handle them.
The most fundamental function of the customer management process is to offer a centralized system, known as a ticketing system, via which service agents may track, prioritize, manage, respond to, and handle customer enquiries or internal employee requests on a mass scale.
In this case, the customer management processes are those steps that help smoothen the relationship between your organization and your target customers. Businesses succeed when they have satisfied customers, and to secure these purchases, you need to provide good customer service.
Customer management processes include:
- Generating leads and establishing a stable communication routine with potential customers to convert them into paying customers.
- Providing high-quality customer service with prompt responses to support issues, using a customer support knowledge base, to improve customer retention.
- Establish your company’s reputation as a reliable and trustworthy source to deepen customer relationships.
The name of this process should give you a good idea of what it entails. Regulatory processes are internal processes concerned with complying with important regulatory requirements. This is crucial, as it ensures that the company can operate legally. These regulatory procedures may involve social responsibility, health policies, compliance with environmental laws, and contract negotiation.
Paying attention to regulatory processes ensures that you put the welfare of employees first, participate actively in community activities, and place your organization on the right foot with regulatory bodies. Therefore, no stone must be left unturned in this process, as all compliance processes have to be accounted for.
How does a company know when and how to expand into new markets? Innovative processes can take care of this. They are concerned with assisting companies in developing innovative methods for possible expansion. For example, it can be done by developing complementary products or creating an entirely new product line. In addition, innovation processes can give employees autonomy while still formalizing workflows.
For companies to stay competitive and appeal to a diverse customer base, their innovation processes should be top-notch. So, you also have to consider the measures you put in place to monitor the effect of the use of resources in innovation processes. The goal is to:
- Introduce a new and improved product to the market.
- Enter a new market with a high-quality range of products.
- Meet sales goals after a successful product launch.
Also, Read: Process Improvement Tools
Importance of Internal Processes
An internal process could make or break your business. Get it right, and you’ll build a business that maximizes resources and productivity. Here are some amazing ways internal processes can help your organization.
Enhances employee efficiency
Your employees are as efficient as the processes instituted in your company. Therefore, no matter how skilled they may be, improper internal processes may hamper their performance.
Therefore, improving your internal processes will assist in harnessing the expertise of your employees so that they are more efficient and deliver outstanding results. Of course, this is supported by research showing that properly empowered employees experience higher job satisfaction, which translates to more loyalty to your company. Therefore, improving internal processes increases employee happiness and efficiency.
Helps in process optimization
Enhancing your company’s internal processes helps optimize processes, so it takes less time to get tasks done efficiently. When there are cumbersome procedures, your employees wouldn’t be able to function as quickly as you would like, preventing them from using the company’s resources effectively. Therefore, one of the most crucial steps toward optimizing your processes is ensuring that your internal processes are carefully outlined through internal documentation. At the same time, the environment allows new ideas to thrive.
Identifies gaps and challenges
Without processes that are as effective as they should be, it can be difficult to identify the gaps and challenges that need to be addressed to improve your company’s operation. This will reflect how team members and employees approach issues, which may lead to complacency in addressing challenges. However, improving your internal processes makes it easier to identify areas that need improvement while minimizing the chances of encountering problems in your operations.
Makes job responsibilities clear and reduces errors
Maintaining an error-free workplace is crucial to making your business stand out, as this reduces the chance of damaging the company’s reputation or creating customer issues. Therefore, your business processes are important in your drive toward mitigating losses and proactively decreasing errors. Standardize your company’s fundamental internal processes, as this clarifies job responsibilities and reduces the chances of errors to the barest minimum. This way, every employee understands their tasks, and you can eliminate risks that may derail your employees’ progress.
Maximizes employee and customer satisfaction
Employee and customer satisfaction translate into profits, as customers are more likely to be loyal to a brand that keeps them happy and satisfied. You can improve employee and customer satisfaction by maintaining standardized internal process documentation. When you consciously try to improve your company’s internal operations, the positive impact will reflect how customers respond to your brand’s products and services.
For example, creating a well-defined internal process can help the support team improve efficiency and reduce response time. Customers who receive timely responses from the support team are likely to have a more positive experience, which leads to higher customer satisfaction.
You can also include improvements in product features, customer support, user onboarding, and sales that will be visible to your customers over time.
Ensures quality products and services
No matter what, maintaining a positive brand reputation is crucial to your company’s longevity in your chosen industry. This starts with delivering quality products and services that make you stand out from competitors in the marketplace. Therefore, you can reduce the chances of churning out low-quality products and services with standardized internal processes that ensure every employee understands their responsibilities without overlaps and no steps are left out.
Increased profits are the ultimate sign that your business is doing something right. When there are positive changes to your internal process, it’s easier to increase your company’s profit. But there’s little motivation to enhance your internal processes if it doesn’t reflect positively on your company’s profits, right? So, with more focus on your internal processes, you can reduce expenditures without adversely affecting employee efficiency and increase profits.
Also Read: Guide to Improve Healthcare Process
Steps to Improve Internal Process
Improving your internal process consists of eight critical steps. These will ensure that your internal process changes achieve their objectives of streamlining your business processes and improving productivity.
1. Conduct an internal audit
Conducting an internal audit is a fantastic way to improve your internal processes. This process involves evaluating several key parts of your business operations, including your product delivery system and how long it takes to carry out customer service roles. An internal audit can also include a precise mapping of each employee’s roles and responsibilities and how this affects making products and services ready for the market. This is also the perfect time to examine your risk management and ability to solve problems when unexpected issues arise.
2. Define an objective
Why do you need to evaluate your company’s internal processes? The answer to this question will determine your key objectives and goals to ensure you’re moving in the right direction. For every internal process, you should highlight what you want to achieve. At this point, you may already have a good idea of your goals. However, it’s still worth reflecting on what you want to gain from this process and how the results will impact your business operations.
So, lay out a picture of what you want to improve, whether it’s consistency, efficiency, or a more streamlined process. Pay attention to tasks that are more difficult to carry out during the production process, as this will help you pinpoint problematic areas. With this, you can save valuable time and resources.
3. Describe the purpose
Why are you doing this? What’s the end goal? This defines the purpose of improving your internal processes. However, you’re not just describing this to yourself but to your employees to ensure that they are on board with why you want to change up a few things about how the company’s internal processes work. This includes letting them know how this could help them be more productive while saving a lot of money and resources within the company. Your team can adjust to this better when you dish out valuable advice on navigating the changes and what to do when they encounter difficulties.
4. Review the current process
Before making changes to your internal processes, you need to review your current strategy to get a good idea of what you already have in place. This is great for identifying weak spots in your current process, which will assist your business in adjusting internal processes to correct these errors. Then, conduct a detailed audit of your current process to analyze its positives and negatives.
5. Set areas of improvement
There will always be room for improvement. A key aspect of improving internal processes involves identifying the important areas that will benefit from improvement. A review of your current process will reveal both positives and negatives, and these can serve as the foundation for pinpointing areas for improvement in your internal process. Identify what each process does and how to improve it.
6. Plan, document, and implement change.
When you finally make changes to any aspect of your internal process, it’s important to document these new changes. This will ensure that everyone can easily access the necessary resources to understand these changes. This is where internal knowledge base software comes in. A knowledge base is a company-made resource center that contains documents and tools for internal processes. Employees within the organization can use these to carry out their tasks effectively. This is one of the best ways to reduce learning and technical difficulties, as only topic experts can add or edit content in the knowledge base.
7. Automate processes with the right tools.
Next up is to pay attention to specific areas that can be automated to make the process more seamless. Look out for existing manual processes and implement the right tools to automate them. This can include automating the hiring process, onboarding procedures, or even using timekeeping software to monitor employee vacation and leave requests. Project management software will ensure that employees understand their responsibilities better and adhere to the timeframe for accomplishing tasks. There’s little chance of errors with automation. You should also incorporate an internal knowledge base that bridges the knowledge gap between several departments within the organization.
8. Evaluate and improve
As you transition your internal processes, it’s still important to review them regularly to point out areas for improvement. Therefore, you can set up a yearly review session to evaluate the impact of your internal processes and where you can improve to make your business operations smoother. With this, your organization can stay updated based on current data. In addition, the yearly audit is excellent for reassessing your internal processes.
Internal processes are vital in the corporate world and shouldn’t be disregarded. However, improving your business processes is not as simple as it sounds. You can make this process as seamless as possible by implementing automated software that will make it easier to increase business profits, boost employee motivation, reduce expenses, and increase customer satisfaction.
Alongside improving your internal processes, it’s essential to implement proper process documentation, as this will eliminate the chances of wasting resources during onboarding new employees. Want to get started building your internal process? Request a demo with Document360 to begin using our extensive knowledge base software to document important information for internal and external teams.
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Frequently Asked Questions
Internal process understanding is critical for operations efficiency, cost savings, quality control, adaptability, employee engagement, &continuous improvement. In a dynamic &competitive market, it enables firms to streamline processes, optimize resources, & drive success.
Here are some examples of internal processes: employee onboarding, inventory management, financial management, customer relationship management, supply chain management, Internal communication and knowledge management.
Common challenges faced by businesses in internal processes include inefficient workflows, lack of standardization, poor communication, siloed information, manual and error-prone tasks and resistance to change.
Improving internal processes offers numerous benefits to businesses, including enhanced efficiency, streamlined workflows, cost reduction, improved quality and consistency.
Internal process improvement methodologies include Lean Six Sigma, Business Process Reengineering (BPR), Total Quality Management (TQM), Agile methodology, Kaizen, and Continuous Improvement.