Business Systems vs Processes

Many people use the words business systems and processes interchangeably. While they are related, there is a distinct difference between the two, and you’ll need to implement both to drive growth efficiently and effectively for your business. So, let’s break down the difference between business systems and processes—and provide some examples of each.

Business System Definition

At their most basic, business systems are a series of connected processes that may or may not include technology. They break down into 4 key pillars: Planning, People, Processes, and Technology. Business systems are generally more complex than processes because they include the execution of multiple processes and as they mature, often utilize technology to execute those processes more efficiently and with far less error.

Processes Definition

Processes, at their most basic, are a series of documented steps or tasks. Processes, like systems, may or may not include technology, which can often add to the confusion. Processes are often less complex than systems because they are created to move you to the next process or to achieve a specific outcome.

The Difference

You may be thinking, so, what’s the difference?! And if that’s you, great question! The easiest way to tell the difference between business systems and processes is by looking at some examples of each.

When we’re talking about business systems, we’re often referencing Customer Relationship Management (CRM) Systems, Enterprise Resource Planning (ERP) Systems, Quality Management Systems (QMS), Inventory Management Systems, Safety Management Systems, Human Capital Management System, etc. That said, we could also be talking about Content Creations Systems, Sales and Marketing Enablement Systems, E-Commerce Systems, and a host of other systems you may find throughout your business.

On the other hand, when we’re talking about processes, we’re often referencing things like generating an estimate, entering a work order, answering customer phone calls, generating pick tickets, counting inventory, packing orders for shipment, quality inspections, safety audits, creating a piece of content, and a host of other activities that need to be completed throughout your business.

The easiest way to understand how they work together is by looking at the individual processes you and your team are executing to see how they fit together to form a more complex system. So, for example, let’s take the process of taking an order from a customer. Before we take an order, do we need to create an estimate? If so, what’s the estimating process entail? If not, what do we do with the order after we’ve taken it from the customer? Where does it go next? There are plenty more questions that could be asked but you can probably already see how the process of taking an order is just a part of a larger system that executes multiple individual processes to achieve the larger goal of driving growth for the business.

TL;DR

• Business systems are a series of connected processes that may or may not include technology.
• Processes are a series of documented steps or tasks
• Examples of business systems: Customer Relationship Management (CRM) Systems, Enterprise Resource Planning (ERP) Systems, Quality Management Systems (QMS), Inventory Management Systems, etc.
• Examples of processes: Generating an estimate, entering a work order, answering customer phone calls, generating pick tickets, counting inventory, packing orders for shipment, quality inspections, etc.
• The easiest way to understand how they work together but are different, is by looking at the individual processes you and your team are executing to see how they are a part of a series of processes that form a more complex system.

To learn more about the 7 Key Business Systems you need to drive growth and operate with excellence, be sure to check out this resource.

That’s it for today.

See you all next week!

Dave