Business Process Modeling

Happy Haircuts Porter's Generic Strategies Porter suggested that there are four generic strategies that a company can follow in order to be successful. These are the cost leadership strategy, the cost focus, differentiation and differentiation focus (MindTools, 2014). Happy Haircuts is a small business, but it offers a wide range of services. Thus, it does not serve a narrow target market, something many businesses of this type might. Instead, it can handle ladies', men's and children's haircuts, along with a full range of salon services and manicures.

Thus, there is a fairly broad target market, albeit within a small geographic area. Happy Haircuts is therefore is a broad market, but it must now decide if it wants to compete as a differentiated provider or as a low cost provider. One of the main competitors is a spa nearby, which is differentiated. Aside from good service, there seems little to differentiate Happy, which means that it must choose the cost leadership strategy. This strategy relies on having efficient operations, and high volumes that make up for low margins.

The shop must therefore run near capacity. Process Models Process models help to make sense of how the business makes its money. Understanding these process models helps a business to "optimize the efficiency of connecting activities" (No author, 2013), something that is perfect for a company seeking to be a low cost provider to a broad market. Further, better processes can enhance the customer service element at a relatively low cost. There are two processes at work, the appointment and the walk-in.

While one involves an established customer and the other a new customer, both follow roughly the same process. First the customer makes the contact with the shop, via phone, email or by walking in. The first point of contact is either the receptionist or the manager, who will discuss the needs of the client and set up appointments with either the person requested or whoever is available. The service is performed, payment collected and the customer is sent on their way.

This basic process can be enhanced in order to provide better customer service and to foster better brand loyalty. This will bring in more business, thereby bringing the shop closer to capacity, one of the key objectives. Further, there is little additional cost to improving on this basic process. The low level version of this process includes the key elements of dialogue between customer and shop. The shop needs to find out from the customer what his/her needs are in order to understand what services need to be provided.

Then the services are scheduled. This usually happens in line with the needs of the customer, and the availability of staff. This can be complicated when the customer wants multiple services. A good example would be a customer that wants her hair styled, a manicure, and haircuts for her two children all at the same time. At the low level, there is the potential for a customer to wait, but there is currently no system for handling either multiple simultaneous inquiries or for dealing with backlogs in service provision.

A lot of the shop's daily activities are done on an ad hoc basis, which results in service delays or service gaps, both of which are bad for the bottom line. The key to business process modelling is to have a rough understanding of a generic process, and then seek to find ways to alter that process in order to better meet the business' objectives. So for example, finding ways to improve scheduling,.