MIST Quiz #4 Business Process Innovation
Parallel (AND) Gateway / Join
- Provide a mechanism to synchronize parallel flow and to create parallel flow - depicted by a diamond shape that MUST contain a marker that is shaped like a plus sign
What is the silo effect?
- workers complete their tasks in their functional silos without regard to the consequences for the other components of the process - The silo nature of the functional organizational structure and the cross-functional nature of processes are at odds with each other - there is a need for communication and collaboration between functions
ERP systems
-execute the process -capture and store process data -monitor performance
What is BPNM?
3 most basic elements: event, task/ activity, flow/arc - gateway is 4th!
Revised Order Management Process
Activities located in two parallel paths do not need to be performed simultaneously. "Send invoice" and "ship goods" need not occur both at the same time, although due to a cosmic coincidence, they could happen at the same time.
Examples of business processes
Customer order fulfillment, manufacturing, planning and execution, payroll, financial reporting, and procurement
What are the issues discussed with Nike and Nintendo?
In 2000 Nike produced too much of the wrong shoe and not enough of the right shoe. This is because the production group and the production systems were not talking to the sales group and the sales systems. They had advanced systems in manufacturing and advanced systems in sales - but the forecasting system was separate front these others and since the different groups didn't talk to each other, nobody noticed the problem until $100 million dollars later and 20% of the stock price. In 2007 Nintendo was very successful in introducing and selling the Wii - they could produce up to demand, but they were not integrated with their suppliers. So they could not get the components they needed and missed on a ton of sales - over $1 billion by one estimate.... Nintendo had great systems in place, but these were separate from their suppliers.
What is a functional organization structure?
In a functional structure, each unit has its own information system that optimizes its work. Purchasing has a purchasing system; the warehouse has a warehouse system; sales has a sales system, etc. Purchasing, operations, warehouse, sales & marketing, research & development, finance & accounting, human resources, information technology
Advantages of ERP
Include single point of data capture and single version of the truth -- real-time information everywhere. This enables you to integrate processes across functional units -- breaking down silos and stovepipes
Exclusive Decision/ Merge
Indicates locations within a business process where the sequence flow can take one or more alternative paths - only one of the paths can be taken - depicted by a diamond shape that may contain a marker that is shaped like an "x"
Commonality between Nike and Nintendo
The different isolated units weren't talking to each other. We call this "stove-piped" organizational units. In today's fast-paced and ever-changing world. companies can no longer be stove-piped
BPM Notations
There are a variety of notations for capturing, communicating and designing business processes (documenting both the As Is and the To Be) - from left to right: sequence diagram, flowchart, EPC (event-driver process chain)
Cross-Functional Enterprise System
The solution most companies are adopting is to adopt an enterprise system. One form -- an enterprise resource planning (ERP) system addresses accounting, financial, and manufacturing proceses
What are some issues with functional systems?
These systems are isolated, or stove-piped from each other. Different functions and their systems don't talk to each other. This results in delays.
Network
Two or more systems joined together via a switch, communicating via a routing protocol. The purpose of a network is to enable the sharing of files and information between multiple systems ex) when you answer your office phone you are accessing a network
"OR" gateway/join
XOR may execute twice if multiple token arrive out of synchrony AND-- will wait for all token to arrive, branch may not be alive -- deadlock! OR-- waits as long as branch is alive
What is a business process?
a standardized set of activities that accomplish a specific task, such as processing a customer's order
CRM
customer relationship management -- sales, customer support, marketing Siebol used to be the dominant CRM company, but they lose this lead to Salesforce.com
Consequences of poor coordination
delays- increased lead times, increased cycle times excess inventory- just in case lack of visibility across the process- status "where is my order, how is the process doing
ERP
enterprise resource planning -- financial, accounting, HR, manufacturing SAP is the world's leading ERP vendor on the high-end. Microsoft is a big player for smaller companies.
Order Management Process
includes the customer as a process participant... The Order Management process is started when a customer places a purchase order
Pools
independent organizational entities ex) customer, supplier, east-Tallin Hopsital, Tartu Clinic model resource classes
What are enterprise systems?
o Also known as an enterprise resource planning (ERP) system. o Combines business processes from all (or most) areas of the company into one integrated software system o System that integrates information from many parts of the company o System uses a common central database o Data is made available to all areas of the company o When data is entered by one process, it is immediately made available to other business processes
PLM
product lifecycle management -- design, engineering, research & development, prototyping
Lanes
subdivide pools into single resources. model the same business process from the perspective of different organizations. resource classes in the same organizational space and sharing common systems ex) sales department, marketing department clerk, manager, engineer
SCM
supply chain management -- suppliers, vendors