Competitive advantage is achieved through four key elements: People, Processes, Technology and Product; and for maximum effect these must work together. This was the message from Ian Gotts, Chief Executive of Nimbus Partners, who stated at the October meeting that enterprise process management is a holistic approach to business process management with in-built quality systems.

Gotts set the scene through a recent article in the Economist, which revealed that only one in five change-management projects actually succeeds. The article quoted a survey by consultants AT Kearney of 294 European companies in which 63 per cent reported a temporary improvement that was not sustained. In spite of the fact that less than 50 per cent of all 'total quality management' programmes show demonstrable results, companies keep trying, simply because there is no alternative. Another survey, this time by Atticus, measured 400 companies' opinions of their own ability to change. These results were supported by AT Kearney's findings that the most successful companies learnt from change and 'institutionalised their knowledge, building it into their culture and performance assessment'.

Chinese whispers

But to be able to put in place long-term, tangible business improvement, we need the entire organisation to be singing from a common hymn sheet. Therefore, it is vital that companies have processes in place and that everyone in the organisation is aware of them, understands them and feels that they have the power to change them if they identify business benefits. Processes, or 'how we do what we do' are, as every quality manager knows, are essential to avoid chaos. All too often they are handed down verbally, becoming distorted like Chinese whispers, or are published in a tome the size of War and Peace, useful as doorstop but perhaps for little else.

But now, as companies rely on others as part of their delivery chain, those processes need to be communicated unambiguously outside the organisation. Customers buying online, for example, are acting as order-entry clerks. The organisation has no control over them so the processes they use must be crystal clear - compare EasyJet's website with British Airways', to see how customer user-friendliness can vary.

The same goes for suppliers. If a business is outsourcing warehousing or deliveries to an outside contractor it is vital that everyone in both organisations understands the system and that together they create a tool to manage this process, a tool that can be improved if flaws are discovered. A late delivery or an out of stock item means another customer lost. If a business takes its eye off costs for a moment, competitive advantage is lost. So the processes that the business controls extend outside of the company.

Competitive Advantage

Processes define competitive advantage in a world where everything else is equal: you can buy the same technology, recruit the same people and even buy the same products. But what makes a company like Dell so much better than many of its competitors? They are passionate about their processes. As Stelios Haji-Ioannou, Chairman of EasyJet, so succinctly puts it, 'process, not personality, runs our business'.

The term EPM, standing for enterprise process management, has been coined to describe the discipline of developing and managing processes and the supporting information across the organisation. It is described in the following diagram.

In the past a range of disparate tools have been used together to support the EPM life cycle, but the cost of integration has proved prohibitive. With the introduction of corporate intranets, businesses can now have rapid access to information. New tools (like Control Software from Nimbus) are coming onto the market to allow the components of the EPM life cycle to interface and create a virtuous circle. EPM means people are able to understand what is happening in an organisation and cost it accurately, while simultaneously ensuring the rigorous application of quality standards.

Once all the processes are clearly defined in a way that everyone can share and use, your company will be ready to power ahead of the competition. Everyone, even the MD, really will know what's going on. The benefits can be significant.