Implementing a new or changed business process

Implementing important changes is never easy.  It usually requires some or all of the following:-

  • Planning
  • Documentation
  • Training
  • Delegation
  • Re-Training
  • Measurement
  • Accountability

 Take the example of inducting a new range of products into your business.  Sounds simple.  You just set up the new codes in the system and start buying and selling.  I’ve seen this happen in a national company with poor results due to lack of a process.

 Here are just a few items of importance in inducting new products:-


Impact or Risk

Item descriptions need to be consistent

Poor presentation on invoices, website etc. Rise of errors because product is hard to search.

Items need to be correct Category / Sub-Category

Incorrect Sales & Margin reporting by Category

Items need to be assigned to correct supplier, or new supplier to be setup

Possible delay in initial orders of new supplier has a credit approval process.

Items need accurate costs

Wrong Cost, Wrong Margin

Items need appropriate sellling prices. May need to be added to special pricing rules. Special opeining price or promotion may be setup.

Price too high – customers may not buy.

Price too low – product not profitable.

Items need accurate Unit of Measure for Buying and Selling

Inaccurate stock on hand resulting in lost sale or poor fill rates

Items need to be assigned to correct GL accounts for Sales & Cost of Sales

Inaccurate P&L reports

Initial purchase order quantities need to be defined

Too high – could lead to excess stock

Too low – could lead to poor fill rates or DIFOT

Items need to be ordered from supplier and delivery dates confirmed before being advertised or published on website

Publishing items too early can result in poor customer take-up because they think they can order now

Complex processes need documentation, and that involves time, effort and expertise.  What does a good procedure document look like?  At Momentum we like documents that would enable a new person to follow the process competently after one training session.  But we also need a simple overview that experienced people can follow to make sure they don’t miss a step.  For that reason a good Business Process Document contains the following:-

  • A Quick Reference Guide – a simple list of steps in the process, who does them, and when they get done  (this is often printed as a separate page and laminated for easy reference)
  • A Flow Chart – a flow chart that defines the process including decision steps.  This gives people a good overview of the whole process, not just their part
  • A Detailed Work Instruction – this describes how to do each step and usually includes screen shots of the steps that are done in your business software

We think you should not train your team on a new or changed business process until this document is completed.  “I don’t know how to do flow charts” or “I don’t have the time” you say?.  Yes but every business has at least one MS Office ‘gun’ who can do them, or train others.  As a Manager you can even hand-write the steps and the flow chart and hand it over to be documented.  Consider the impact of not doing it.  Who’s accountability is that?

 Next week I’ll discuss what happens once a Business Process has been defined and documented.