Focussing On Turning Pain Points Into Gain Points: Independent Process Descriptions & Reviews
Whether you are starting a new business or trying to grow your established business, you are likely to be faced with various pain points. A pain point can be defined as a specific, often recurring, problem that your business will experience or may currently be experiencing – something causing your business pain or difficulty. The problem may be relatively small while you are still operating on a small scale. However, if left unaddressed, these seemingly small issues can become major roadblocks to the success and sustainability of your business in the longer term.
Types of pain points include:
- Financial pain points – these include not being able to access sufficient capital when required; not getting a sufficient return on investment already made; spending too much on your current processes, or even on attempts to solve the original pain point without getting any value in return. On the other hand, anything causing you to lose revenue could also be a financial pain point.
- Process pain points – such as misallocation of resources; experiencing issues, delays, and misunderstandings amongst staff about the current systems and processes in place; infrastructure problems in a rapidly growing business – working with a team of 10 staff is very different to working with a team of 50 or more staff members; not being prepared for a disaster and knowing how to recover operations in the event of a disaster, whether natural or otherwise.
- Productivity pain points – for example, processes currently done manually which take hours to complete (consuming more resources which you could potentially apply better elsewhere); lack of innovation resulting in stagnation, reduced enthusiasm from your team and the threat of new competitors taking over your market share.
- Support pain points – this may include not getting the support you need in developing your business, or not knowing who to ask for help; it could also impact on your customers, for example your customers not receiving the proper support or after-sales service that they need, which could result in them going elsewhere where service is perceived to be better.
One of the key areas where Internal Audit can assist a business is in addressing its process pain points. A good starting point is to get your Internal Auditors to document your business processes in detail. While you may know the process back to front, your Internal Auditor can bring a fresh pair of eyes, looking for areas of improvement, thereby benefitting your overall business over the long term. Having an independent person, like your Internal Auditor, capture the process description in a structured format, can shed light on the following:
- What is supposed to happen during the process
- Who is supposed to perform the various steps, and
- When these steps are supposed to be performed.
Analysing the current process helps to identify dependencies and where process steps require manual inputs. Opportunities for automation of routine, repetitive tasks can be identified, which ultimately can reduce the risk of human error and free up resources for other more valuable tasks.
Another benefit to formally documenting the business processes is that all role-players can improve their understanding of what is required. Employees (including new starters) involved in the process will have a formal process description available, explaining to them in detail the steps to be followed. Defining the roles and responsibilities of the team at each stage in a process also leads to improved teamwork and collaboration. Workshopping the process with your team can build employee engagement and even lead to innovation. Processes can then be standardized leading to greater efficiency.
A key part of documenting and analysing the process in question, is a risk and control assessment. With management’s input, the Internal Auditor should assess the likelihood and impact of the existing and potential risks to the process. The Internal Auditor then also identifies whether there are adequate and effective internal controls already built into the process to mitigate against the risks. Where there are gaps in the process, the Internal Auditor makes recommendations for improvement that helps strengthen the internal controls, making the process more robust. Risks left unchecked could result in delays, inefficiencies and / or non-compliance to relevant regulations and standards. This exposes the business to potential financial losses and reputational issues.
Working with your Internal Auditors
While you know your business, your Internal Auditor can help you by providing you with a fresh perspective. Internal Auditors are partners to business owners and management, focussed on helping the business to be successful and sustainable. We do this through independently assessing your systems of governance, risk management and internal controls. One practical way in which we do this, is to document and review your business processes and related risks and controls, with a view to identifying areas for improvement. This can help in turning a process pain point into a gain point.
This article was written by Tania Knoetze, Service Line Leader for Internal Audit.
Find Tania’s service here: https://thegrowthsmiths.com/collections/internal-audit-services