BUSINESS OPERATIONS
INTRODUCTION
Every simple and complex activities that occurs within a company on a daily basis to
keep the business running and increase the value of the enterprise (earn a profit) is
referred to collectively as business operations. These operations evolve as the business
grows and it varies according to the business type, size and industry. For example,
Manufacturing industry have different business operations compared to retail industry
or service industry, Operations of online stores are different from brick and
mortar stores. It is important for an organization to understand and master business
operations of their specific industry to gain stability and achieve success.
Task 1
Examine the importance of business processes in delivering business goals and
objectives.
1.1 Identify and evaluate organizational functions, their main processes and the
relationships between the functions.
Ans: Organizational functions are the set of activities operated and carried out by
employees of the organization to achieve their goals. The management allocates
different departments to carry out the different functions of the organization. These
functions can be categorized into front-end functions and back-end functions. Front-end
functions are functions of an organization which include direct connections with the
customers which include Marketing, Sales and Customer Service. Back-end functions
are the activities carried out behind the scenes such as HR, finance, administration,
information technology and these functions also play an important role in making sure
the front-end functions are carried out properly. All these functions are very important
to the success of the organization and these functions should be closely affiliated with
each other to achieve higher business goals.
Front end organizational functions
Marketing and sales functions include activities like creating demand, and identifying
and attracting customers for the organization's product or services and they are
responsible for defining the brand of the organization. The marketing department goes
through research, promotions, and surveys to identify the needs of the customers and
satisfy them with excellent products and services. Monitoring and managing the social
media, and the website of the organization is also carried out by the marketing
department and these tools are used for various purposes such as advertising products,
introducing new products/services, interacting and updating the customers, etc.
The customer service function has the responsibility to provide excellent service to the
customers and communicate directly with the customers regarding queries, and
complaints about the specific product or service. Feedback about the product or service
(such as product quality and ratings) is also carried out by the customer service
department to find areas of improvement and help resolve the complaints.
Back-end organizational functions
Finance functions include overseeing activities related to making financial decisions,
preparing accounts, controlling and producing cash flow, accounting, financial reporting
and dealing with many other finances of the company. Administrating expenses of the
organization and budgeting all the processes of the organization are carried out by the
finance department on a daily basis and they are linked to all the other departments so
that their functions are dealt with effectively.
The production function is responsible for manufacturing quality products for the
organizations or for producing services. During the process of production, the
department works on many functions like improving product quality, collaborating with
other departments to manage labour, discussing demands, etc.
The human resource department deals with the organisational function of management
of human resources and has key responsibilities including recruitment, training, and
firing of employees. They ensure that the organization has all the workforce in different
departments to achieve their respective objectives. Other functions include maintaining
employee records, updating policies, conduct disciplinary actions against the employees
(if there is any conflict).
The IT department is responsible for establishing monitoring information technology
and data sharing within the entire organization. They oversee the maintenance of the
computer networks used for communication between the employees and stakeholders
and make sure all the information of the organization stays secure.
Organization process are the series of tasks assigned to the stakeholders in an
organization to achieve a collective goal or objective. The organization process can be
categorized into 3 different categories:
1. Management processes involve strategic planning, budgeting, and corporate
communication, monitoring and making organizational decisions. The purpose of
these processes is to ensure that there is a smooth and effective running of the
business procedures and systems in the organization. Management processes do
not provide direct value to the customers or necessarily generate income, these
processes exist to facilitate income opportunities and to ensure the continued
overall success of the business.
2. Operational (primary) processes are the cross-functional processes that deal with
the core business which adds direct value to the customers. These processes
represent the essential business activities of the organization mainly to serve the
need of customers and generate income. Operational processes include
evaluating inputs and outputs of the organization, ensuring feedback, customer
service, sales and marketing, communication and analyzing the results.
3. Supporting (secondary) processes involve processes that enable the operational
processes to be carried out. These processes also do not generate income directly
but bring value in other ways to the organization. Supporting processes include
managing employee lifecycle (HR management), accounting, control of data and
documents, etc.
All the organization functions and departments have a relationship between them to
ensure all the activities are carried out properly and every department benefits from
these relationships. It is important for functions/departments to work together and
maintain effective communication to achieve all the organization's goals and objectives.
1. The marketing function require the help of a production function to ensure
quality products and communicate customer demands for any certain product. The
marketing function communicates with the finance function to enquire about
promotion or advertisement budgets.
2. The IT functions have a relationship with all the other functions to share and
communicate different information required in order to achieve their objective.
3. The HR function seeks help from all the other departments to know the vacant
positions and hire the required candidate with the correct skills for other
departments including sales, marketing and customer service department.
1.2 Review methods and approaches for mapping organizational processes.
Ans: Business process mapping is a powerful planning and management tool which
visually depicts the flow of work and how the processes should function from start to
finish. A business has many processes which differ from one another, from paperwork to
manufacturing products. The mapping of the business process is usually used in an
organization to draw out the exact sequence of the process including who is responsible
for a particular task, and when it happens?. Different chart methods, flowcharts, and
symbols are usually used when mapping organizational processes. The main purpose of
mapping is to improve efficiency in business processes, increase communication,
analyze how a process can be improved and make sure the stakeholders understand the
smooth running of a process.
There are different steps to creating an effective business process map. The first step is
to identify the process which needs to be mapped. This step helps in better
understanding of the process and gives the answers to different questions like when
does it start, why, when does it finish, etc. The second step is gathering all the
information for the process. The information can be of budgets, supplies, key
responsibilities, inputs and outputs, stakeholders involved, etc. The third step is to
analyse the situation including the steps of the process and evaluate it thoroughly. This
includes listing the process in proper sequence and connecting the steps, determining
who is responsible for different tasks and identifying redundancies. The final step is the
implementation of the plan in the flowchart which includes executing the plan or the
idea. The map should be checked regularly to see if the process is going in the correct
sequence or not.
Different methods and approaches for mapping organizational process
Basic Flow Diagram
It is the most common and simplest mapping methods
used by an organization which depicts the major process
and tasks in a top down fashion. The major task are divided into sub tasks if needed and
similar tasks and activities are grouped together in the flowchart. This mapping method
is mostly used for simple processes of the organization including planning projects and
managing workflows. It helps organization identify tasks and activities more clearly and
helps in eliminating steps which is not needed during a process.
Swim lane maps
This mapping method is used for analyzing complex business processes which are cross-
functional in nature, hence also called cross-functional flowcharts. This mapping
method uses lanes to
show the relationship
between the process
steps and the
teams/departments
responsible for
working on the
process. It separates
the sub-process
responsibilities of the
process depicting who
does what, which
department does what, Swim Lane Maps
when the department
start the process, etc.
SIPOC diagrams
Many organizations tend to use this method of mapping for high-level representation of
a process because it categorizes the critical elements of a process which are the
interaction between Suppliers, Inputs, Processes, Outputs and Customers (SIPOC) and
these form the columns of the map. This method help organisation define the total scope
of the complex processes. Stakeholders list out all the relevant information to the
process, including identifying the inputs and outputs of the process, customer
requirements, and suppliers of the inputs required for the process.
SIPOC Diagrams
BPMN process maps
This approach is a more formal way of mapping organizational processes, where specific
diagrams, language and Business Process Modeling Notation symbols are used to break
down organizational processes.
BPMN process maps
Value Stream mapping
Value stream maps help visualize, analyze and improve the steps required to bring the
product or service to the
customer. This method
depicts the flow of
process and the
information from the
beginning to delivering
the service/product to the
customer and this can
help identify delays and
inefficiencies. This map is useful to find and eliminate areas of waste within and
between processes.
Data Flow diagram
A data Flow diagram is a technique which follows the flow of data and information for
any process from the beginning to the end. Data inputs and outputs, and storage points
are included in the map and it is represented with defined symbols. This diagram is used
to map out and visualize various complex processes that can't be described in the block
of texts. Data flow diagrams are of two types, physical and logical. Logical diagrams are
used to depict the theoretical flow of information through a system, like the incoming
and outgoing of data, where it is being transmitted and where does it end. Physical data
flow diagrams focus on the practical process of information flow which specify software,
hardware, files, and customer's influence during an information flow.
