Your organization should have clearly defined business goals. If it does not, well, that’s an article for another day. For now, let’s assume that it does. The question then becomes: “Will your business processes take you to where you want your organization to go?” What if you could see a picture of your key business processes from beginning to end to spot areas of inefficiency and opportunities for improvement? Well, process maps accomplish just that – as the old cliché goes, “A picture is worth a thousand words.”
A process map depicts, in graphic form, the key elements of a business process from start to finish. Many organizations document work activities and procedures in narrative form. While, this approach allows for a more detailed description of how work gets done, links and interconnections can be difficult to spot in wordy narratives. Process maps graphically depict critical information succinctly while highlighting deficiencies, bottlenecks, and weaknesses in business processes. The following are benefits of process maps:
- Enhance understanding of the process roles, steps, and activities.
- Present complex relationships and connections in pictorial form.
- Provide a “bird’s eye” view of a process from start to finish.
- Can be used as a tool to simplify, streamline, or redesign a process.
- Highlight process bottlenecks, inefficiencies, and improvement opportunities.
- Serve as a complement to written narratives to fully document a business process.
Process maps can be useful companions to narratives that facilitate understanding of how work flows through your organization. Depending on the complexity of the activity, process maps can replace written narratives. In a well-developed map, the most important aspects of the process can be seen clearly. For example:
- Who is involved in the process?
- What is the starting point for the process?
- What actions and activities occur during the process?
- What decisions are made throughout the process and by whom?
- What actions are taken based on the outcome of the decisions?
- What documents and systems are involved in the process?
- What are the bottlenecks, inefficiencies, and control weaknesses in the process?
- How does the process end and with whom?
For illustrative purposes, let’s look at an example. Assume your accounting manager has submitted the following narrative of the accounts payable process;
Accounts Payable Narrative
All invoices arrive either through the mail or through a dedicated email address. No matter how they arrive, all invoices must meet imaging format and parameter requirements to be processed through the accounts payable (AP) system. For invoices received via regular mail, AP imaging specialists review the invoices for propriety and completeness. The imaging specialists then scans the invoices to convert them to images and forwards them to the designated AP clerk for further processing. If an invoice does not meet specifications, it must be rejected and returned to the vendor for correction and re-submission. Invoices received via e-mail are already checked by the system for proper coding and format. All vendors have been instructed to email invoices in prescribed format. The AP system creates a system invoice using character recognition technology. The AP clerk reviews the scanned invoice for propriety before releasing it into the AP system for processing. Once all invoices have been processed, the AP supervisor reviews the invoice report before approving the invoices for payment.
After reading the narrative, you instruct the accounting manager to develop a process map that highlights areas of inefficiency. The map is shown below with areas of inefficiency highlighted in red. At a glance, one can readily see the work the image specialist performs on mailed invoices is inefficient because the invoices must be reviewed manually and returned to the vendor if not correct.
This information could lead to a change in policy requiring all vendors to email their invoices following the prescribed format rather than mailing them. As the process map illustrates, emailed invoices go directly to the accounts payable clerk for processing. The benefits of process mapping are clear; process flows, bottlenecks, and inefficiencies are spotted clearly and quickly.
Accounts Payable Process Map
In Lewis Carroll’s novel, “Alice in Wonderland”, Alice and the Cheshire Cat engage in the following conversation:
Alice: Would you tell me, please, which way I ought to go from here?
The Cheshire Cat: That depends a good deal on where you want to get to.
Alice: I don’t much care where.
The Cheshire Cat: Then it doesn’t much matter which way you go.
If your business goals matter, then how work gets done in your organization should matter. Mapping your business processes can point the way to greater efficiency and stronger controls to help you get there – wherever “there” may be.
Mr. Gilbert Hopkins is a consulting director within McConnell & Jones’ risk advisory and business process improvement team. Mr. Hopkins is a certified public accountant with more than 30 years of accounting and business experience. He has performed a multitude of compliance, operational and efficiency audits for a diverse clientele. These projects include financial audits, performance audits, compliance reviews, business process analysis, cost studies, strategy implementation, and research projects. Connect with Gilbert on LinkedIn.
For more insights on improving business processes:
- Fraud and Internal Audit – Assurance Over Fraud Controls, Fundamental to Success
- Enterprise Risk Management – Integrating with Business Strategy and Performance
McConnell & Jones’ consulting services provide a systematic process for aligning operational outcomes with strategic objectives and stakeholder demands.