Process-based management is a management approach that views a business as a collection of processes, managed to achieve a desired result."''Process-based Management''" Barron's Business Guides: Dictionary of Accounting Terms, Jae K. Shim et al., Barron's Educational Series, 2014. Credo Reference, Accessed 09 Oct 2016. The processes are managed and improved by the organisation in purpose of achieving their

vision Vision, Visions, or The Vision may refer to: Perception Optical perception * Visual perception, the sense of sight * Visual system, the physical mechanism of eyesight * Computer vision, a field dealing with how computers can be made to gain un ...

mission Mission (from Latin ''missio'' "the act of sending out") may refer to: Organised activities Religion *Christian mission, an organized effort to spread Christianity *Mission (LDS Church), an administrative area of The Church of Jesus Christ of ...

and core value. A clear correlation between processes and the vision supports the company to plan strategies, build a business structure and use sufficient resources that are required to achieve success in the long run. From a process perspective, an organisation regards its business as a system of vision-achieving vertical processes rather than specific activities and tasks of individual functions. (19:25) The system is not a method or tool for a particular process, but a holistic approach to manage all the processes in one organisation. Therefore, to manage processes effectively, the organisation must have an effective team network and full knowledge of their vision. The general management system focuses on specific work-knowledge and direct solutions for cost and

budget A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmenta ...

; on the other hand, process based management applies these financial measurements but in an operational way considering how each performance affects the company as an amalgam of different processes. As a result of recent advances in technology and increased international competition, more companies aim for better methods of grouping and integrating organisational activities.

Vision, mission and values

Vision Vision, Visions, or The Vision may refer to: Perception Optical perception * Visual perception, the sense of sight * Visual system, the physical mechanism of eyesight * Computer vision, a field dealing with how computers can be made to gain un ...

and core value are three crucial factors to manage an organisation from a process perspective. Considering the vision, mission and value as a direction of their business, an organisation can build their corporate strategy and determine the processes they will take into account.
, Process Strategy Group. ''Introduction to Process Based Management: What every organisation needs to know about PBM'' nline UK:Process Strategy Group, 2010 ccessed 12 October 2014/ref> As a result, the organisation obtains strengths and competitiveness among other companies. First, the

is an aspirational purpose what the organisation would like to achieve in the long run. The vision leads the company to challenge various tasks and develop its own business strategy. In other words, the organisation considers vision as a motivation to build a business structure, determine strategic plans and manage human resources. Therefore, the company carries out the ‘vision-achieving operations’ as their primary goals.

Mission Mission (from Latin ''missio'' "the act of sending out") may refer to: Organised activities Religion *Christian mission, an organized effort to spread Christianity *Mission (LDS Church), an administrative area of The Church of Jesus Christ of ...

is a fundamental purpose of a company that remains unchanged over time. The mission provides a guidance for decision making and gives a path to successful results.
Business Dictionary ccessed 18 October 2014/ref> For instance, mission is different from a vision in that mission is a something to be achieved whereas a vision is something to be aimed for achievement.
Rosam, I., Peddle, R. ''Creating a Process-based Management System for ISO 9001:2008 and beyond'' nline UK: The High Performance Organisation Group Ltd., 2008 ccessed 10 October 2014/ref> Core Values is a principle that helps companies to determine whether the actions and decisions are right or wrong. The value is essential to take decision-making and sustain the company’s long-term success.
David F. ''Process-Based Management: A Winning Strategy'' nline Canada:Boeing, 2010 ccessed 19 October 2014/ref>

Advantages of process-based management

* Documenting a process provides a clear guideline of how organisation improves their processes and performances over time.
Ward, M. ''What is a process and processed-based management system?'' nline Ireland: Netcoach, 2011 ccessed 12 October 2014 * Process based management measures the full set of activities in one business. For instance, it focuses on internal processes such as

customer satisfaction Customer satisfaction (often abbreviated as CSAT) is a term frequently used in marketing. It is a measure of how products and services supplied by a company meet or surpass customer expectation. Customer satisfaction is defined as "the number of c ...

, quality of product and security as well as financial results including

revenue In accounting, revenue is the total amount of income generated by the sale of goods and services related to the primary operations of the business. Commercial revenue may also be referred to as sales or as turnover. Some companies receive reven ...

s, profits, costs, and

.
Badreddine, A., Romdhane, T.B., and Amor, N.B. Proceedings of the International MultiConference of Engineers and Computer Scientists. ''A New Process-Based Approach for Implementing an Integrated Management System: Quality, Security, Environment,'' 2009; 2:2-6 * Understanding of the correlations between business processes avoids taking wrong decisions. It reduces costs, time and resources wasting on unnecessary things.
Leonardo Consulting. ''Why Process-Based Management?'' nline Australia: Leonardo Consulting, 2010 ccessed 14 October 2014/ref> * Analysing the processes, an organisation will be able to predict sources of hazard and choose right decisions. * The system protects

intellectual capital Intellectual capital is the result of mental processes that form a set of intangible objects that can be used in economic activity and bring income to its owner (organization), covering the competencies of its people ( human capital), the value rela ...

of the organisation. Monitoring the development of processes, the organisation can analyse risks and its weakness. * Focusing on continuous improvement and customer’s requirements, the organisation improves

customer service Customer service is the assistance and advice provided by a company to those people who buy or use its products or services. Each industry requires different levels of customer service, but in the end, the idea of a well-performed service is that ...

s which deliver value to its customers. * Evaluating the process assures the results a company expecting to obtain. * Process based management is an integration of both input and output in business process. It controls personnel, technical and financial resources in a holistic viewpoint. * The organisation can improve IT system that reduces unnecessary complexity and improves the quality of performance measurement. * Analysing processes and implementing new objects if required, the organisation deal with fast changes in demand.

Three stages in process-based management

Documenting the process

To manage its business from a process based perspective, an organisation requires to understand what defines the process and which activities they consist of. A business consists of different departments in charge of specific jobs or functions. Therefore, the processes support these managerial sectors and transform successful outputs. Then a process team performs a set of sequential tasks to analyse whether the organisation delivers useful outputs to the customers. Basically, processes are built by information that indicates the current state of company and research data such as customer satisfaction. The information includes customer-based agreement, management documentation, purchasing manuals and

flow charts A flowchart is a type of diagram that represents a workflow or process. A flowchart can also be defined as a diagrammatic representation of an algorithm, a step-by-step approach to solving a task. The flowchart shows the steps as boxes of v ...

. For instance, the flow chart is a useful information in order to control the flow of processes and list several steps and activities in detail.

Analysing process performance

Analysed and clarified processes are allowed to implement on the actual business. Then, an organisation monitors its business and improves the overall stage of process. To evaluate the sequence of process, measurement is an essential element that shows results of process performance with numerical and comparative data. In other words, organisations obtain a relevant analysis using the measurements that can be shown as graphical representations such as

pie chart A pie chart (or a circle chart) is a circular Statistical graphics, statistical graphic, which is divided into slices to illustrate numerical proportion. In a pie chart, the arc length of each slice (and consequently its central angle and are ...

bar chart A bar chart or bar graph is a chart or graph that presents categorical data with rectangular bars with heights or lengths proportional to the values that they represent. The bars can be plotted vertically or horizontally. A vertical bar chart is ...

s, cause-and-effect analysis, and

gap analysis In management literature, gap analysis involves the comparison of actual performance with potential or desired performance. If an organization does not make the best use of current resources, or forgoes investment in capital or technology, it m ...

. Many organisations highly depend on data and visual analysis processed by information system. For this reason, organisation must obtain accurate analysis based on exact data and must be cautious for mistaken output that impacts whole process of their business. As a result, the measurements help the company to analyse current state of performance and give guidance for the firm’s sustainable improvements.

Implementing the improvements

Having designed the processes of management system and analysed the performances using useful measurements, the final step is how to improve the system and maintain its effectiveness. Therefore, implementing the improvements is a key activity to examine the processes and improve the flow of the management system. An organisation determines which part of processes must be improved and modified. It analyses how each process influences a set of activities and applies the improvements to some parts of system. The purpose of implementation is to operate its business strategically and to deliver sufficient resources. In effect, the process based management results in outputs that satisfy their customers and develop the business itself.

References

Inline citations

Sources referenced

* Shafer, S.M., Meredith, J.R. Operations Management: A process approach with spreadsheets. USA: John Wilry & Sons, Inc., 1998. * Viio, P., Groenroos, C. Industrial Marketing Management. ''Value-based sales process adaption in business relationship'', 2014; 43(6): 1-42 * Segatto, M. et al., Business Process Management Journal, ''Business process management: a systemic approach?'', 2013; 19(4): 698-714 * Transition Support
''Process based management systems''
UK: TransitionSupport, 2013. Accessed 19 October 2014. {{DEFAULTSORT:Process-Based Management Business process management