Business owners are very smart. They will never invest in an entity which does not have a good ROI in long term. However, as many people believe, ROI is not just something that can be only related to hard costs and revenue, it is also about the intangibles! What if your public reputation is that secret key which is helping you win customers? The same goes with while measuring the success rate of a BPM tool.
The tranquility with which processes are monitored, re-modeled and analyzed for optimization makes BPM tool a principal element for organizations strategy.
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More people are investing in this BPM tool and they have their own purposes, some people look for increased business agility while others look for increased productivity, auditing capabilities, faster time to market, Increased compliance etc. Yes, you read it right the Global BPM market is growing, and it growing tremendously and is expected to worth between $13- $14 billion by 2021.
How is the ROI for BPM tool calculated?
There are basically two approaches:
1. Direct ROI
Direct ROI is a measure of finite and quantifiable values such as material costs. It means increased efficiency, reduced risks and a better way for the distribution of roles and responsibilities. An organization adopting BPM tool are looking for potential benefits that can help them save money in a number of ways.
Savings from Automation
Business Process Management software automatically maps and manages the processes from start to end. This means less human intervention and free staff who can be engaged in more productive and value enhancing tasks.
Duplication can be avoided
Roles and responsibilities are made quite clear along with automated workflows. Employees are no longer indulged in the task that has already been done by someone else. Breakdown and failures can be eliminated. Risk Management and customer dissatisfaction can be reduced by focusing process automation on the potential pain points.
Increased revenue plus better customer acquisitions
Revenue processes can be streamlined which will ultimately reduce the process lifecycle. The final result is savings.
Bpm tool will also help the business to understand the areas where they are lacking and what course of action should be taken to improve them.
Direct Benefits means potential enhancements, empowered employees, which gives the company an ability to focus on more critical customer-centric initiatives.
2. Indirect ROI
Indirect ROI contemplates process and entities that require subjective examination of value, say for example time spent searching a document.
Although difficult to calculate they are as important as the direct benefits. Some of the benefits that can be reaped from Indirect ROI includes.
Customers can easily benefit from these optimized processes as they are looking for simplified and seamless workflows which will provide them easy ways to deal with complex functionalities.
Error reduces to a great extent
As many of the processes are automated and controlled, an intervention of human errors can be reduced to a great extent.
Having a standardized and automated information gathering in place means reports can be generated easily which creates an opportunity to benefit from real-time business intelligence and data analytics.
Reduction in compliance risks
When a business process fails it can create an entry point for reputational damage or financial penalty. Process automation narrows down such problems while improvements in reporting can deliver data which will be helpful to meet regulatory compliance standards.
Easier Change Management
If you have an automated process structure for your organization, a number of variables that participates in change management process can be reduced to a great extent, making future changes easier to accommodate.
Welcoming your customers and clients on-board is easier
If you have standardized procedures for your organizations welcoming to new customers and clients becomes less complex
Standardized Process and Procedures Across the Organization
If processes are standardized it gives the associated tools and resources needed to adhere to the scheduling and budget issues.
The ultimate goal of BPM software is continuous improvements.
It is rightly said you cannot manage or improve-if you don’t measure. BPM success depends on the company’s ability to accurately examine and measure its progress. Your business strategy should not limit to the department you are working but it should strive to benefit the organization as a whole.
Establish a baseline
Understand the current processes before you plan to change them. A common mistake most people do is that they do not create a baseline for the current processes.
Establishing a baseline helps you determine the process improvements an organization needs which involves defining goals for improvements such as shorter cycle time, increased productivity and higher throughput.
BPM software will not only make operational improvements it can help you build the business as well. Don’t misunderstand BPM as a tool that can be used only for cost cutting because it is also about growth and focusing on the customer needs.
Don’t measure too many things at a time
When it comes to determining what to examine be selective because of the temptation to measure everything you will end up focusing only on those aspects you can hit hard!
“It’s better to strike a balance between customer metrics and business metrics”. The common mistake that most of the business make is measuring their success is financial terms rather than customer conversion rates.
Keep the good work going
The expected ROI is not achieved when the metrics established matched with the goal, In fact, this is just the beginning. It is observed that the companies with the maximum ROI continues to revisits their processes and identify the gaps and determine whether they should be filled or a new process should be evolved.
Once you make up your mind to purchase BPM software the road ahead is definitely promising. The increasing practice of tying ROI to a BPM Project has definitely placed it at a good rank in the technology world. All this is possible only If you choose a right BPM tool for your business. In the end, the only thing that matters is what managers and leaders are looking for to improve the bottom line results of a company.