What Is a Business Process? Definition, Types, Benefits, and the Future

Businesses of all sizes and industries function through interconnected activities that generate value for customers, employees, and shareholders. These activities are organized with the definite goal of making business processes. From sales management to customer service, every operation follows a step-by-step process to achieve those defined business objectives efficiently and consistently. Learn all about business processes in an organisation in our blog.

Markets and Markets Research Private Ltd. suggests that the global business process management software (BPMS) market is expected to grow from the current $8 trillion per year to $14 trillion by the end of 2025, with a compound annual growth rate (CAGR) of 10.5%.

What is a Business Process?

A business process is a set of interconnected activities and tasks that involve an organization's teams working in coordination to meet the same organizational goals. Business processes create and deliver value to a customer (internal or external) through a good or service. They allow companies to orchestrate their human resources, efforts, and activities and align them with their customers' needs.

In simple language, business processes allow organizations to add value to a service or product by utilizing available resources efficiently and effectively.

The seven primary characteristics of a business process are:

• Scope: Specifies the limits of the process, such as where it begins and where it ends.
• Purpose: States the purpose of the process—its goal.
• Steps: Lists the particular tasks or activities involved in the process.
• Sequence: Indicates the order in which the steps are taken.
• Participants: Names the people or systems responsible for performing the process.
• Outcome: Indicates the end product of the process, e.g., a product, service, or conclusion.
• Client: The recipient of the process output—it may be the subsequent process in sequence, a peer, or the final customer.

Types of Business Processes

Business processes are typically categorized into three categories according to their organizational purpose:

1. Primary Processes (also called Core Processes)

Primary processes add value directly to the customer. They must provide the product or service that the business is selling.

Purpose: Help the business meet its main goals by satisfying customer needs.

Example:

• In an e-commerce company, receiving orders, packaging, shipping, and post-sales support are the primary processes.
• In a bank, the loan sanction process is a primary process as it directly impacts the customer.

2. Support Processes

Support processes do not directly deal with the customer but are designed to ensure the smooth functioning of the primary processes.

Purpose: Provide internal support to help other processes (primary or management) function effectively.

Example

• Human Resources (HR): Hiring, training, and managing employees.
• IT Services: Maintaining the systems used in sales or operations.
• Finance and Accounting: Managing internal budgets and vendor payments.

3. Management Processes

Management processes involve planning, monitoring, and managing a business's operations. These processes ensure that the organization stays on track with its goals.

Purpose: Oversee and guide primary and support processes to align with the company's strategy.

Example

• Performance Reviews: Tracking employee or department performance against targets.
• Strategic Planning: Deciding long-term goals and how to achieve them.
• Compliance Audits: Ensuring the business is following legal and regulatory rules.

Benefits of Business Process Management (BPM)

Business Process Management (BPM) allows organizations to operate more effectively by enhancing how tasks are scheduled, performed, and monitored. BPM aids productivity, minimizes mistakes, conserves time, and may result in long-term expansion. Some of the most significant advantages are:

1. Makes Organizations More Flexible: BPM enables teams to understand the bigger picture clearly. When any organizational change occurs, it is easier for the management to explain the reason behind it and adjust quickly.  
2. Reduces Errors: When companies use emails or spreadsheets, it is common to lose track of tasks or get things wrong. BPM establishes defined steps and assigns responsibility at each stage, making it simpler to identify and correct issues before they get out of hand.
3. Manages Data Access Smartly: Employees often need information from various sources to complete their tasks but don't need access to everything. With BPM, organizations can provide individuals with access to the correct data, avoiding ambiguity.
4. Brings Everything onto One Platform: Instead of using different tools for each department, BPM systems can connect with major software like ERP and CRM. Data can then flow easily across teams and cut down manual work. It also supports automation where possible.
5. Saves on Software Costs: As BPM integrates various tools and systems, employees and external partners, such as suppliers, can reap the benefits of streamlined and accelerated workflows.
6. Helps Manage Employee Performance: BPM measures the performance of each step in a process. When a particular task is continually late or completed incorrectly, it could indicate a skill deficit. Conversely, rapid and correct task completion indicates high performance. It can inform training and employment choices.

The Future of Business Processes

Organizations' approach to handling business processes is evolving quickly, and they are increasingly aided by digital technologies such as automation and artificial intelligence (AI). The following are significant trends that will define the future of BPM:

1. BPM as a Tool for Innovation

Business Process Management is no longer just about improving efficiency—it's becoming a key part of innovation. When BPM is combined with Knowledge Management (KM), businesses can make better use of their internal knowledge to:

• Improve decision-making
• Enhance process efficiency
• Encourage continuous improvement
• Support digital transformation efforts

2. Automation and AI in Business Processes

According to a global survey by McKinsey, over 72% of companies already use AI tools. These tools are helping to automate and improve complex tasks like:

• Loan processing
• Writing and maintaining code
• Document management

While these tools bring many benefits, companies need to:

• Manage data properly
• Build strong technical infrastructure
• Keep human oversight in place to ensure quality and ethical use

3. Generative AI and Conversational BPM

BPM is evolving from step-by-step, rule-based systems to more flexible and human-friendly methods. With generative AI, business processes can now include:

• Natural language interaction (e.g., talking to a chatbot to understand a process)
• More personalized and context-aware insights
• Easier access to process-related information

This new approach, called Conversational BPM, makes business processes more adaptable and easier for people to engage with.

Conclusion

Business processes form the base of how organizations create value, whether for customers, employees, or stakeholders. By correctly incorporating business processes, organizations can work smarter, make fewer errors, and change more smoothly. Rapid technological advancements make business processes smarter, more efficient, and more people-friendly. Adopting this change is the key to remaining competitive and future-ready.