Business Process Standardization & Re-engineering

Standardization of internal business processes, like any other tool (and a concept or procedure can be viewed as a tool), can be a double-edged sword. It can have many benefits if used properly, or can be harmful if poorly designed or misapplied. One of the great challenges for any organization, especially large ones within which many divisions produce different products for different markets, is knowing when and where to standardize processes, structure, and tools.

This entry is intended to address standardization in the most difficult circumstances: large corporations with many, diverse divisions.

To clarify, horizontal divisions might consist of a marketing group who define customer needs, a design group who dream up products to meet those needs, an engineering group who design the parts of the products and make sure they fit together, a production group who assemble the products in quantity, a logistics group that transports products to customer locations, and a sales group to complete the transactions with customers. Vertical divisions could exist to address parallel product or customer types, or unrelated products that shared other synergies such as a common resource or common technologies. So what do you need to know to use standards effectively?