In business processes, a Deviation refers to any execution of work that departs from defined standard business processes, rules, or policies.
Deviations in business processes can be classified into several patterns depending on the nature of the work. By analyzing deviations from these perspectives, organizations can identify, organize, and better understand the state and characteristics of deviations occurring in their operations.
Procurement Process
In the procurement process, Deviations refer to departures from standard procedures, rules, or criteria, and they can occur in various forms. Typical types of deviations in procurement include the following:
- Price Deviation:
Purchases that exceed approved budgets or standard prices. - Quantity Deviation:
Purchases that exceed or fall short of approved quantities. - Quality Deviation:
Purchases of goods or services that do not meet approved quality standards or specifications. - Supplier Deviation:
Purchases from vendors not included on the approved supplier list. - Delivery Date Deviation:
Purchases where approved delivery dates cannot be met. - Contract Term Deviation:
Purchases made under conditions that conflict with existing contract terms. - Procurement Procedure Deviation:
Deviations from standard procurement processes or procedures. - Approval Authority Deviation:
Purchasing decisions made by individuals without the appropriate approval authority. - Regulatory Deviation:
Deviations from legal requirements or compliance standards.
Such deviations may lead to cost overruns, quality issues, supply delays, or legal risks. Therefore, deviations must be properly managed and justified when necessary.
In many organizations, deviations require formal approval through a defined exception-handling process. Managing deviations is a critical element in maintaining efficiency and control within the procurement process.
B2B (Business-to-Business) Order Management
In B2B order management, deviations can occur in various forms. These deviations may arise in relation to contract terms, customer requirements, or internal policies and procedures. Typical examples include:
- Price Deviation:
Pricing that deviates from contractual or list prices. - Delivery Date Deviation:
Shortened delivery schedules requested by customers or delays from planned delivery dates. - Quantity Deviation:
Orders that deviate from contracted or standard order quantities. - Specification Deviation:
Customer requests for changes to product specifications. - Contract Condition Deviation:
Deviations from standard contract terms, such as payment terms, warranty conditions, or return policies. - Supply Chain Deviation:
Deviations from standard supply chain processes or approved suppliers. - Regulatory Deviation:
Deviations from legal requirements or industry standards. - Service Level Deviation:
Changes to agreed service levels or support conditions. - Approval Authority Deviation:
Transactions or contract execution beyond authorized approval limits. - Customer Segmentation Deviation:
Transactions that deviate from standard customer segmentation or target market definitions.
These deviations may increase business risk or negatively impact profitability. Therefore, it is essential to manage deviations appropriately and obtain internal approval when required.
Analyzing the root causes of deviations and implementing corrective measures to prevent recurrence are also critical.
B2C (Business-to-Consumer) Order Management
In B2C order management, deviations have different characteristics compared to B2B transactions. In B2C contexts, deviations often manifest as gaps between customer expectations and the products or services provided by the company. Typical types of deviations include:
- Price Deviation:
Discrepancies between advertised or displayed prices and actual selling prices. - Product Specification Deviation:
Differences between product descriptions (online or in catalogs) and the actual delivered products. - Delivery Date Deviation:
Differences between promised delivery dates and actual delivery dates. - Order Content Deviation:
Delivery of products that differ from what the customer ordered. - Inventory Management Deviation:
Issues such as products shown as “in stock” but actually being out of stock. - Customer Service Deviation:
Customer inquiries or complaint handling that falls below standard service levels. - Payment and Refund Policy Deviation:
Payment or refund handling that deviates from published store or website policies. - Delivery and Logistics Deviation:
Differences between promised delivery methods, timing, or costs and the actual delivery service. - Marketing and Advertising Deviation:
Discrepancies between marketing claims and the actual products or services provided.
Such deviations can reduce customer satisfaction, damage brand trust, and even result in legal issues. Particularly in B2C markets, deviations directly affect the customer experience and significantly influence repeat purchases and word-of-mouth.
Minimizing deviations and consistently meeting customer expectations is therefore essential.
Sales Operations
Deviations in sales operations can impact revenue, customer relationships, and brand image. Deviations in the sales process may occur in the following forms:
- Target Deviation:
Deviations from established sales targets or KPIs. - Pricing Deviation:
Deviations from company pricing policies or discount rules. - Misrepresentation of Products or Services:
Incorrect communication of product features, benefits, or conditions to customers. - Inappropriate Customer Conduct:
Unethical or unprofessional behavior in customer interactions. - Contract Violations:
Actions that violate agreed contractual terms with customers. - Improper Handling of Customer Data:
Failure to protect customer privacy or inappropriate use of customer data. - Lack of Post-Sales Support:
Insufficient follow-up or customer support after sales. - Fraud or Misconduct:
Fraudulent or dishonest actions in sales activities. - Inappropriate Statements About Competitors:
False claims or unfair competitive practices regarding competitors. - Internal Policy Deviation:
Deviations from internal policies or sales process guidelines.
Such deviations can undermine customer trust and create legal risks. Appropriate training, monitoring, and guidance for sales teams are essential. Early detection and corrective action are critical to protecting corporate reputation and profitability.
Expense Claims
In expense management, Deviations refer to departures from corporate expense policies and rules. Common examples include:
- Excessive Expense Claims:
Claims for unnecessary expenses or inaccurate amounts. - Inappropriate Expense Items:
Claims for items that violate expense policies (e.g., personal or entertainment expenses). - Incomplete or Missing Receipts:
Failure to submit required receipts or supporting documentation, or falsification thereof. - Approval Process Deviation:
Submitting expenses without following required approval processes. - Payment Condition Deviation:
Claims that violate company payment conditions or deadlines. - Budget Deviation:
Expense claims that exceed allocated budget limits. - Fraud or Misconduct:
False or fraudulent expense claims. - Repeated Violations:
Recurrent violations of expense policies.
These deviations may negatively affect financial accuracy and indicate weaknesses in internal controls. Preventing deviations requires clear expense policies, employee education, and appropriate monitoring and approval processes.
When deviations occur, prompt corrective action and preventive measures are necessary.
Summary
By analyzing deviations across various business activities, organizations can uncover not only process-related issues but also deeper structural challenges related to people and organizational design.
Process Managers must continuously monitor deviations and work to eliminate their root causes. BPMS and Process Mining are highly effective tools for identifying, analyzing, and managing such deviations.