What are the best practices for setting up process indicators and targets?

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Process monitoring and control are essential aspects of business process improvement (BPI), which aims to optimize the performance and efficiency of business processes. By measuring and analyzing key process indicators (KPIs) and comparing them to predefined targets, you can identify gaps, issues, and opportunities for improvement. In this article, we will discuss the benefits of process monitoring and control, and share some best practices for setting up process indicators and targets.

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1 Why monitor and control processes?

Monitoring and controlling processes can help you achieve several benefits, such as improving customer satisfaction and loyalty, reducing costs and waste, increasing productivity and profitability, enhancing innovation and agility, and ensuring compliance and risk management. This can be accomplished by delivering consistent and high-quality products and services, eliminating errors, defects, and rework, streamlining and automating workflows and tasks, enabling continuous learning and improvement, and adhering to standards and regulations.

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Imrul Kayes

Co-Founder, Camel Tech | Business Automation
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Monitoring and controlling processes is important because it helps track performance, identify issues early, and ensure everything runs smoothly. By regularly checking key indicators, you can make timely adjustments to improve efficiency and meet your business goals. In a project I worked on, we set up regular checkpoints to monitor our supply chain process. This allowed us to catch delays and fix them before they became bigger problems. Monitoring kept us in control and helped us stay on track to meet our targets, improving overall performance and customer satisfaction.

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2 How to define process indicators?

Process indicators are metrics that measure the performance and efficiency of a process. They can be divided into four categories: input indicators, which measure resources and inputs such as time, money, materials, and labor; output indicators, which measure results and outputs such as quantity, quality, revenue, and customer satisfaction; outcome indicators, which measure the impact and value created by a process, such as market share, profitability, customer retention, and social responsibility; and process indicators, which measure activities and operations such as cycle time, throughput, utilization, and error rate. When defining process indicators, you should consider the purpose and objectives of the process, the stakeholders and customers, the best practices and benchmarks of the industry, and the data sources and methods available for collecting and analyzing the indicators.

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Imrul Kayes

Co-Founder, Camel Tech | Business Automation
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To define process indicators, start by identifying the key goals of the process, such as speed, quality, or cost. Then, choose measurable metrics that reflect those goals, like delivery time, error rates, or expenses. These indicators should be specific, easy to track, and directly tied to the process’s success. In one project, we defined process indicators for our customer support team by focusing on response time and resolution rate. These metrics helped us see how well the team was performing and where improvements were needed. Clear indicators gave us the data we needed to make better decisions and drive progress.

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3 How to set process targets?

Process targets are the desired or expected values of the process indicators that indicate the level of performance and efficiency that you want to achieve. To set process targets, you need to consider the baseline and historical data of the process indicators, the gap and potential for improvement between the current and desired performance, the feasibility and realism of the process targets, and the alignment and consistency of the process targets with the organizational goals and strategy. These targets can be expressed as absolute numbers, percentages, ranges, or thresholds, and require resources and actions to achieve them. Additionally, they must meet the stakeholder and customer expectations and requirements.

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4 How to monitor and control processes?

Monitoring and controlling processes involve collecting, analyzing, and reporting the data of the process indicators and comparing them to the process targets. To do this, you can use dashboards and scorecards to track and compare the performance and efficiency of the process. Charts and graphs can illustrate the trends and patterns of the process indicators and targets over time and under different conditions, while reports and feedback can summarize and communicate the results and findings of the process monitoring and control. These tools and techniques can help you identify anomalies and outliers, as well as provide recommendations and suggestions for improvement.

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5 How to improve processes based on monitoring and control?

Monitoring and controlling processes can help you to identify and prioritize the areas and opportunities for improvement. You can use various methods and frameworks for this purpose, such as the Plan-Do-Check-Act (PDCA) cycle, the Six Sigma methodology, and the Lean approach. The PDCA cycle involves planning the improvement actions, implementing them, checking the results and effects, and acting on the feedback and learning. The Six Sigma methodology uses statistical and analytical tools to define, measure, analyze, improve, and control the quality and variation of the process. The Lean approach focuses on eliminating waste and adding value to the process by applying the principles of continuous improvement, customer focus, and flow optimization.

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What are the best practices for setting up process indicators and targets?

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1 Why monitor and control processes?

2 How to define process indicators?

3 How to set process targets?

4 How to monitor and control processes?

5 How to improve processes based on monitoring and control?

Business Process Improvement

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