This is a methodology for business organization that puts the basis for all the company´s structure on the processes that the entity must develop. It is clearly different from other organizational forms because most of organizational structures are based on the functions and the limits that separate these functions, while organization by processes emphasizes that, in spite of the differences separating specific functions, there is a common factor to all of the operation, which is customer satisfaction, and this factor is materialized in the processed executed by the company. For that reason, organizing the company by processes aims to the integrality of the operation and not to the separation in it.
To lead by processes means to run a company from a structure based on process and not on functions. This aims to solve the difficulties brought by the function-organization, because this one “creates a silo effect within an organization, and this often leads to selfish or self-centred behavior by the management and staff of each silo”. Sometimes this brings “the detriment of other silo’s and the organization as a whole” (Jeston y Nelis, 2008).
Basing the management on the processes unites the operation, because “business processes are the link between all aspects of an organization. Processes are the link between an organization and its: suppliers, partners, distribution channels, products and services, people (personnel), other stakeholders” (Jeston y Nelis, 2008).