Business Process Management
PDCA - Act (two categories exist for "Acting" on process performance data collected from the "Check" phase)
(1) Actions on individual process instances (real‐time or near‐real‐time intervention) an only happen where real‐time or near‐real‐time performance monitoring exists. (2) Identification and planning of change to process definition and deployment (i.e., changing the way all process instances will be executed in the future) is the feedback loop, which ensures the continuity of a process through environmental change and enables the continuous improvement of a process over time.
Categories of Business Processes
(1) Primary Processes are end‐to‐end, typically cross‐functional processes that directly deliver value to customer. Primary processes are often referred to as "core" processes because they represent the essential activities an organization performs to fulfill its mission. These processes make up the value chain where each step adds value to the preceding step, measured by its contribution to the creation or delivery of a product or service and ultimately delivering value to a customer. 2. Support Processes are designed to support primary processes, often by managing resources and/or infrastructure required by primary processes. The main difference between primary and support processes is that support processes do not directly deliver value to customers, while primary processes do. Common examples of support processes include those found in information technology, facilities, finance and human resource management. While support processes are often tightly associated with functional areas (for example a process that grants and revokes network access), support processes can and often do cross functional boundaries. 3. Management Processes are designed to measure, monitor, and control business activities. They ensure that primary and support processes are designed and executed in a manner that meets operational, financial, regulatory, and legal goals. Management processes, like support processes, do not directly add value to customers but are necessary to ensure the organization operates according to effectiveness and efficiency targets.
The role of Technology in BPM implementation
- Information technologies can be employed to support BPM practitioners in the execution of BPM methodologies. - The IT function is an enabler of BPM efforts, not a leader. - BPM implementation is not an IT project but a coordinated modification of business management practices that may be enhanced by technology. The decision to invest in technology should be driven from strong business requirements and a disciplined approach to determining a return on investment.
BPM - addressing end-to-end work and the orchestration of activities across business functions
A comprehensive management of an end‐to‐end business process requires a comprehensive understanding of the business process. This understanding must extend well beyond How work is done: it must also address What work is done, When, Where, Why, and by Whom. A Business Process Management discipline must accommodate the means by which this comprehensive understanding is facilitated.
BP Maturity Stage - Proactively Managed
Ability to predict and plan for change in order to take advantage of it or to prevent it from compromising the delivery of value to customer. Proactive management of business processes is the Holy Grail of Business Process Management
BP Maturity Stage - Architected
An organizational commitment to progressing into the Architected state of Process Maturity requires an investment in those capabilities supporting Planning and Definition (the "Plan" phase of the Process Lifecycle), specifically in the development of the various Enterprise Architecture disciplines
BPM Comprises strategies, goals, culture, organizational structures, roles, policies, methodologies, and IT tools to:
Analyze, design, implement, control and continuously improve end-to-end processes, and to establish process governance.
Management Discipline
Body of knowledge that addresses the principles and practices of business administration. It specifies the principles and practices that direct the management of business resources toward stated objectives.
BPM - addressing delivery of value to customer
Business processes deliver value to customer in the form of products and services. Business Process Management is about optimizing the means by which this value is delivered
Business function
Classification of work that is done by an organization based upon a particular skill or professional expertise. OR a Center of Excellence: a grouping of people and tools specialized in a specific profession, discipline, or area of expertise.
Process Life Cycle
Deming's Plan Do Check Act (PDCA) Cycle. Business Processes should be managed in a closed‐loop cycle to maintain process integrity and enable continuous improvement
Functional Management
Ensures execution of the myriad functional disciplines required to produce the organization's products and services.
Business Process Management
Ensures work is coordinated across these myriad functions in order to deliver products and services in the most effective and efficient manner possible.
BPM Enterprise Perspective
Enterprise Process Management & Process Organization
Governance
Governance is a structured approach to decision making and the means by which decisions are implemented (or not implemented). Applied to business processes, governance implies - Structured DECISION MAKING regarding how an organization functions with respect to the delivery of value to customer - A structured APPROACH TO IMPLEMENTING changes in the way an organization functions with respect to the delivery of value to customer.
Fit for purpose
Implies that the process definition contains all necessary information to answer the Who, What, Where, When, Why, and How questions it is intended to address
Fit for use
Implies that the process definition is structured to represent this information in the most efficient and effective manner possible, considering the needs of the intended audience
Process Analyst
In small Business Process Management implementations, the Process Analyst can have responsibilities across all phases of the Business Process Lifecycle. In larger implementations, Process Analysts might specialize in one or two key aspects of the discipline. A sampling of typical responsibilities includes - End‐to‐end design of the organization's business processes (under direction of Process Owner and with input from functional SMEs) - Maintenance of the process model repository - Collaboration with Process Owner and Stewards to diagnose problems and propose solutions - Performing analyses (e.g. performance analysis, impact analysis and process simulation) as requested by Process Owner and/or Process Stewards - Typically, membership on the team that assesses and prioritizes requests for process change - Typically, membership on process change implementation teams.
The means by which business processes are defined and represented should be Fit for Purpose and Fit for Use
It is prudent to understand what purpose the process definition will serve, and focus on building and maintaining only the representations that support this purpose
Business Process Maturity Curve
Level 0 - Ad-Hoc: Level 1 - Defined: Level 2 - Controlled Level 3 - Architected Level 4 - Proactively Managed
Business Process Management (Core Internal Capability)
MANAGEMENT DISCIPLINE that integrates the strategy and goals of an organization with the expectations and needs of customers by focusing on end-to-end processes.
BP Maturity Stage - Controlled
Organizations driving progression from a Defined to a Controlled state of Process Maturity have truly begun to recognize business processes as assets and have discovered that the care and maintenance of them is typically worth the investment. They start investing in those capabilities supporting Performance Monitoring and Reporting and Response to Change and Continuous Improvement (the "Check" and "Act" phases) - Example: The emergence of specialized roles such as Process Owners and Process Stewards
BP Maturity Stage - Ad-Hoc
Organizations have very little if any understanding and definition of end‐to‐end, cross‐functional business process and little visibility into the true means by which value is delivered to customer
BP Maturity Stage - Defined
Organization‐driving progression from an Ad‐Hoc to a Defined state of process maturity will often make investments in those capabilities supporting Process Planning and Definition ("Plan" phase) - Example: The emergence of Business Architect, Business Analyst, and Process Analyst roles as distinct from technology‐focused Systems Analyst roles. And Detailed Process Design, Build, and Deployment ("Do" phase) - Example: Technology deployment efforts that are more tightly coupled with business stakeholders and better deliver on business need;
Efficiency Measures
Performance measures gathered from inside out, or from the internal operations perspective, are typically referred to as efficiency measures and are designed to answer the question "Are we doing things right?" These measures are put in place to monitor process performance with respect to time and cost.
Effectiveness Measures
Performance measures gathered from outside in, or from the customer perspective, and are designed to answer the question "Are we doing the right things?" These measures are put in place to ensure customer needs and expectations are consistently met.
Roles engage in the management of business processes
Process Architects responsible for business process definition and design Process Analysts responsible for build, deployment, monitoring and optimization of business processes Process Owners responsible for the end‐to‐end execution of business processes against defined performance expectations and ultimately the delivery of value to customer.
Business Process
Set of activities that transform one or more inputs into an output (product or service) of value to a customer.
Enterprise Architecture Disciplines
Strategic Planning - Specifically, Strategic Planning identifies and relates components like vision and mission, objectives and strategies, products and services, and internal and external health indicators to optimize and improve market position. Business Architecture - identifies and relates key business components such as products and services, internal capabilities, business processes, business functions and roles, performance goals, key performance indicators, and information systems. Information Architecture - identifies and relates data and information components relevant to customers, partners, suppliers, and internal business entities Application Architecture - ensures that the various functional application, workflow automation, and business process management systems are optimized to support business process execution Core Services Architecture.
BPM Process Perspective (Core Areas)
The Process Modeling, Analysis, Design, Process Implementation, Process Performance Management, Process Performance Transformation are enabled and supported by BPM Technologies.
Process Owner Non-Functionally aligned - reporting directly to the head of the organization
The Process Owner is a centerpiece role in a Business Process Management implementation and is assigned overall responsibility for the end‐to‐end management of one or more business processes. Specifically, this means that the Process Owner is responsible for ensuring the process meets established performance (effectiveness and efficiency) expectations.
Implementation of BPM is a strategic decision and requires strong executive sponsorship
The end‐to‐end management of large numbers of business processes in aggregate and across organizational boundaries introduces a new paradigm. New roles focused on the end‐to‐end management of business processes across functional organizations must interact with traditional functionally‐based managers under new governance structures. These introductions fundamentally change the way organizations make decisions and the way in which resources are allocated
Process Steward
The role of Process Steward is played by members of the organization's functional management—that is, the managers of operations staff who execute activities within an end‐to‐end business process.
Process Governor
The role of the Process Governor is critical in driving process maturation through standardization in the practice and use of BPM methodologies and tools. This role is less focused on the content of the organization's processes than on how that content is documented and managed. The role of Process Governor can be played by the same person who is the Process Owner in small BPM implementations and when the Process Owner is functionally neutral. However, in implementations where the Process Owner is functionally aligned, it is usually desirable to have a separate role of Process Governor (reporting to the Head of the Organization).
Process Leader
The role of the Process Leader is played by members of the organization's executive leadership team and may or may not involve representatives of the process ownership function. Additional responsibilities associated with the role of Process Leader might include: - Defining the vision and strategy for Business Process Management and sponsoring its implementation - Ensuring that process performance objectives are established in alignment with strategic direction - Confirming that process change recommendations and prioritizations are in alignment with strategic intent.
PDCA - Do
To DEPLOY the process per the specifications developed in the "Plan" phase and to commit the process to operations
PDCA - Check
To MEASURE process performance against performance expectations.
PDCA - Plan
To ensure that both business process context and internal process design align with the organization's strategic objectives.
PDCA - Act
To make determinations and react accordingly to process performance data collected in the "Check" phase. This phase enables maintenance of process integrity despite environmental instability and through environmental change, and ensures the process can be continually improved to meet new performance goals over time.
Successfully implemented, Business Process Management is a core Internal Capability
When an organization has (1) Business Processes which themselves, support the management of business processes (definitions & design, build & deploy, monitoring & control of execution and continuous process improvement over time) (2) Specific roles engage in the management of business processes. (3) Specialized technologies deployed to support the management of business processes
Capability
a collection of processes, people and technologies that together provide value toward the achievement of strategic objectives.
