It's a seductive concept, but what happened to the old value chain take?
A core process is one that directly contributes to the value of your company, be it bottom line, brand, customer base, customer satisfaction etc.
Of course the best run companies weave explicit links between customer-facing processes and the rest of the value chain processes - for example they link marketing, customer service and customer journey mapping to design, manufacturing, packaging, logistics and customer support.
So, even though some of the core processes along the value chain do not directly touch the customer, they should be designed with the customer in mind.
Sorry do not agree as I see all people in any organisation collectively make the business as do their processes. To classify as "not core" is to demean contributions and a route to dissatisfaction in the work place and abuse even fraud....? There is a case to identify those processes that could have consequences good or bad with external relationships such as customers and regulatory bodies. Yes they may have a proirity require extra vigilance etc but "core" the wrong word / description...?
Hi all !!
Make sense to think in a set of processes as "core processes" for organization and for Customers... those can not be terminated or discontinued once it delivers what your organization offers for the market (what Customers want to consume) and enables the organization to accomplish their visions, missions and also part of their strategies.
I prefer to call others set of processes (those that not touch the Customers) as "Supportive Processes" instead "non-core" processes and it make more sense for the people that work at organization... enabling the cooperation and engagement once these set of processes are essential for the survive of the "core processes" and people tend to understand it as important part of all it.
It is important when defining / understanding / documenting processes to userstand the core (value chain) processes and those that are supporting processes. But core does not necessarily mean most important. That depends on the priorities of the business at any point in time. So it is naive to simply say that all BPM focus should first go into core processes.
A high growth company recruiting 200 people per week needs to have the best R2R (recruit2retire) processes and these are probably more important than some elements of core processes.
Porter's Value Chain describes two main types of process- the ones that add value, and the ones that support or enable, such as IT and HR. For me a key challenge was how to graphically describe and incorporate the processes of the Executive Team and external bodies such as Industry Regulators.
I resolved this by adding a third layer of processes (above the core processes in Porter's chain) called 'The Guidance Processes'. These are all of the processes whose outputs steer, influence and control the direction and scope of an organisation- such as Strategies, Policies, Goals, Budgets and Objectives.
If these 'Guidance' factors originate externally, such as Sarbane -Oxley compliance regulations, then the output factor acts as a 'Control' on a particular process or sub-process.
Apple deals with their suppliers in such a way that it gives them a competitive advantage. It ensures they have a monopoly on new components which excludes their competitors. I'ld consider that a core process for them, yet it doesn't touch the customer.
Or at a news paper (i mean the kind that you can't swipe and where you phisically have to turn the pages). Printing the paper also looks like a core business process that doesn't touch the customer directly.
Of course you can start playing with the meaning of 'touching the customer' and also include 'indirectly impacting the customer'. In that case everything a company does is core :) But as a definition, I don't see this can make it easier to find them.
If you use this as a way to identify core processes, the problem could be that you focus too much on how the company operates today. I think it takes leadership and vision to identify the core processes in an organization. Visionary leaders identify which processes and other aspects are core to create better value for the customer. These core processes may not even exist today.
Being supply-chain oriented, I typically look at is as business process functions vs. support functions. For example, sourcing, mfg, stocking,order entry, and delivery (everything that ensures the customer gets what they need when they need it) would be process examples. Finance, IT, HES, HR, etc, are more support-oriented, That's not to say there's a difference in importance, as the support functions are critical enablers for the performance and sustainability of the process functions, and typically have impact across all process functions.
I definitely agree with Bogdan.
For me, not all customer-related processes are necessarily core. What makes a process core is the relation it has with the organization's value proposition.
In some cases that might have to do directly with clients but that isn't always the case.
For example, a secondary process that isn't directly related to the essence of what the organization offers isn't a core process. A company that sells services can see their support process as something secondary. However, all documents related to the sale are core, so a good document management is essential for that company.
I'm on team "not necessarily." If you are a company that provides customer service as its primary function, then perhaps your core process IS the customer-facing one.
In most cases, however, like other things with a "core" (say, a human torso) all the "guts" of internal processes live there. We wouldn't consider the out-ward facing processes as core just because that's what the public can see. Those customer-facing processes probably make the most money, but they can't rival the infrastructure for importance--it's only the surface. It's the core that ensures the customer input finds a resolution, supports the daily functioning of the company, and connects all various aspects of your business together.
However, if calling something "core" is just a play on words to relay the importance of the customer interaction...okay, then. It's just semantics at that point and you can (try to) use it to adjust the company culture, if that's your goal.
That's the sort of thing one says that they know is hyperbole, but say it anyway to drive home a point. It's important to consider the customer in every process, even those you don't normally think of as customer-facing. For example, imagine an employee time-off request process. You would normally think of such a thing as a purely back-office function, something about as far away from the customer as can be imagined.
But maybe not. For example, maybe you want to vet such requests through an individual or system that knows when major product releases are going to be announced. Or perhaps that particular employee plays a key role with a specific customer, and the account manager is aware that the requested days overlap with a significant customer order.
So perhaps the point isn't that non-customer-focused processes aren't "core", but rather that core processes are actually customer-focused much more often than we are accustomed to believing.
Here's a SlideShare reference posted by Mr.Freek Hermkens of a Roger Burlton presentation which references "core processes linked to external customers" (Slide 14).
Concerning the original question, on one hand the wonderful comment attributed to Peter Drucker, such that the only purpose of business is the create a customer, can be seen as supporting the Burlton approach. On the other hand, I see that today's mania for customer experience can turn business processes into black boxes. Where as Mr. Chassels points out, "contributions are demeaned".
Can we say a balance is the right approach?
Customer driven, yes!
But hands-on process ownership too! All processes!
There is an old joke that I keep applying to business presentations whenever I hear this argument about who's the most important department in the company (mostly sales and marketing jump up front, saying the rest is just auxiliary).
The joke is about the body parts who have the same argument: the brain says it coordinates everything and everybody would just not be able to do anything without it; the heart says it pumps blood into everybody and they would not survive for 1 minute without its activity... and everybody laughs at the a*hole making the claim that it's the most important... And then the a*hole gets upset and goes into shutdown mode.. After some time the body parts start to give in... the brain gets hazy, the heart is throbbing uncontrollably... and they all cave and admit the a*hole is the most important.
Of course, in my explanation, accounting is the a*hole (wrong on so many levels, especially as I lead such a department) - just try accounting's willingness to process your payroll slips, a vendor invoice or an expense report :-)
It’s impossible to answer this question properly without knowing whatBurlton means by ‘core process’. Personally, I’m having a hard time thinking of a concept of core vs non-core that serves any useful purpose. Perhaps it’s just a euphemism for not-waste.
Oh what’s that… there’s a voice in my head… it sounds like Procesje (who must be on holiday or something becuase he didn't already join the thread)… and he’s saying, ‘Your customers don’t care what you think is a core process… they only care about process results that are visible to them’.
So I guess there are worthwhile processes that impact the customer in some positive way, and there’s waste, such as most of your meetings and time spent fiddling with the animations in PowerPoint presentations. I don’t think there’s much in between.
All processes touch the client directly or indirectly every process is core by the very nature of processes. To regard a process as "core/non-core" creates a silo in management that can create a problem in value stream. Bottom line my professional opionion every process is core and should be managed as such.
Have a good day/evening.