BUSA 379 CH 1 Introduction to Business Process Management
Process Analysts
conduct process identification, discovery, analysis, and redesign coordinate implementation and monitoring report to management and process owners have business or IT background
Process Performance Metrics
cost, time, capacity, efficiency, flexibility, quality measurements of different process characteristics that tell how a process is performing used to determine whether a process is in good shape or in bad shape.
BPM inherits
from the continuous improvement philosophy of TQM, embraces the principles and techniques of operations management, Lean and Six Sigma, and combines them with the capabilities offered by modern information technology, in order to optimally align business processes with the performance objectives of an organization.
Elements of ERP
hardware ERP application programs ERP databases Business process procedures Training and consulting
organizational change management
refers to all the activities that we need that are that we need to change the way that we're working by our employees that involve that particular process and they can include looking at things that changes in the process in the process that we're working that look at our and understand both what changes are being introduced and why these changes are benefiting so we need to make sure that's clearly understood and explained bringing and putting the change management plan out to the stakeholders and know that changes are gonna affect and they're gonna be transitional issues that we need to take care of through and make sure that's also clearly explained to get to our are to be process that we were and then of course ultimately out as I've mentioned before training is very important and training our our users in these new processes so we've identified them we've documented them and control them and now we're going to make sure as we implement these that we also train train the employees to these process now if we look at process automation that sort of involves maybe configuration changes or issues that we need to look at that may be a little different and so that that may take on an idea of how we handled a business process management system like ERP and how we may fold in some of the associated processes with that as I mentioned in our concept discussions and so as time goes on these adjustments may are gonna need to be made in relative to our business processes
Bill Gates
"The first rule in any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency".
Adam Smith
(1723-1790), Scottish economist and philosopher, who is best known for his book "An inquiry into the nature and causes of the wealth of nations".1 Among others, this book discusses the division of labor that is used by a manufacturing company for producing pins. While Smith emphasizes division of labor, it is actually the design of the process (what he calls combination) that contributes to the good performance of the manufacturer.
Notations
* = zero, one, or many 1..* = one or many <---- = is a <>--- = consists of
Challenges of implementing ERP
1. Collaborative management - due to functional processes in place there could be silo effects we need to make sure that management from a finance marketing side management needs to get on board with this and make sure that we can adapt these in in processes from an ERP system because typically you don't find management's from various aspects in functional areas across an organization that have the same ideas and ways of doing business 2. Requirement Gaps anytime you adapt something new whether it's the process part or which also drives in application changes are there requirements now that you had before that you lose or are there new requirements that are being generated that we now need to field we need to address those 3. Transition Problems - if you're bringing in new processes if you're bringing in processes that you are going to consider to either transition to or to adapt to you need to understand there are gonna be issues that we have to deal with so dealing with what I mentioned above with requirements and management collaboration but also just in terms of can we get it to work 4. Employee Resistance people do not like change when they're when they've got processes in place that they've been using over and over and again in a comfortable way that anytime you bring in and you're either changing them or adapting them you have employer resistance so again it's important for senior management to come in and push this down and make sure the employees understand the importance of it and that we are going to be moving in that direction 5. New Technology -
error rate
A usability dimension concerned with how many errors a user might encounter and how easy it is to recover from those errors. Error rate is the percentage of times that an execution of the process ends up in a negative outcome
Flowchart
A diagram that shows different paths a program will take depending on what data is inputted. In their most basic form, flowcharts consist of rectangles, which represent activities, and diamonds, which represent points in the process where a decision is made.
process redesign phase
Armed with an understanding of the issues in a process and a candidate set of potential remedies, analysts can propose a redesigned version of the process. This to-be process design is the main output
UML Activity Diagram
At their core, UML Activity Diagrams are cross-organizational flowcharts. However,UML Activity Diagrams go beyond basic cross-organizational flowcharts by providing symbols to capture data objects, signals, and parallelism among other aspects.
BPM Group
BPM Center of Excellence Responsible for preserving project knowledge and documentation maintain process architecture prioritize process redesign projects align the BPM efforts with strategic goals Most common in large organizations with several years of BPM experience
Process Aware Information Systems
BPMSs are just one type of IT tool that supports the implementation and execution of business processes. There are many others, including ERP systems, Customer Relationship Management (CRM) systems, and Document Management Systems (DMSs). These tools are known under the umbrella term of Process-Aware Information Systems (PAISs).
division of labor
Division of work into a number of separate tasks to be performed by different workers we were looking specifically at labor activities dealing with what was going on during the time during heavy manufacturing time within not only industry but also government organizations where this concept of division of labor was really the dominant form at that time The upshot of this development was that workers became pure specialists who were concerned with only a single part of one business process.
Establish Process Thinking in Organizations
Establish BPM Team Describe Process Architecture Define Process Performance Measures Discover and Model Processes Analyze, Redesign, Implement, and Monitor Processes Make use of Process-Aware Information Systems
intermediate level of specialization
In ancient times, in parallel with the rise of cities and city states, this work structure based on generalists started to evolve towards what can be characterized as an intermediate level of specialism. People started to specialize in the art of delivering one specific type of goods, such as pottery, or providing one particular type of service, such as lodging for travelers.
governance
It is also important that the roles and responsibilities in BPM initiatives and the associated decision-making processes are clearly defined, and that measurement systems, guidelines, and conventions are in place to ensure that BPM initiatives are conducted in a consistent manner (governance).
People and culture
Last but not least, it is important to develop an organizational culture that is responsive to process change and embraces process thinking. In other words, the role that an organization's people and culture play for the success of BPM should not be underestimated. In sum, for BPM to be sustainably successful, an organization has to treat BPM as an enterprise capability, at the same level as other organizational management capabilities such as risk management and performance management.
Basic four stages of BPM Cycle
Model Process Create Component Implement Process Assess Results
Process Implementation
Once redesigned, the necessary changes in the ways of working and the IT systems of the organization should be implemented so that the to-be process can eventually be put into execution. More generally, process implementation involves two complementary facets: -organizational change management -process automation
Stakeholders in the BPM lifecycle
Page 52 > Management Team > Process Owners > Process Participants > Process Analysts > Process Methodologist > System Engineers > BPM Group
Process Participants
Perform activities of business process on a day-to-day basis Conduct routine work to the standards and guidelines of the company Coordinated by process owner, who is responsible for non-routine aspects of process involved in domain experts during process discovery and process analysis support redesign activities and implementation
Hammer and Champy describe BPR in terms of:
Radical and fundamental, Dramatic, Process A famous case study illustrating this phenomenon, first narrated by Michael Hammer [59] and subsequently analyzed by many others, deals with Ford's purchasing process. This inspired what became known as Business Process Reengineering (BPR), which Hammer and Champy define as "the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed."
subprocess
Represent a series of process steps that are hidden from view in BPMN. The use of subprocesses in modeling helps reduce complexity Notated with a (+) sign
Process Owners
Responsible for efficient and effective operation of a given process including * planning and organizing, defining performance measures and objectives as well as initiating and leading improvement projects * monitoring - ensuring that performance objectives are being met and taking corrective actions * process modeling, analysis, redesign, implementation, and monitoring
CEO
Responsible for overall business success
Tom Davenport and James Short . This article urged managers to look at entire, end-to-end processes
T.H. Davenport, Process Innovation: Reengineering Work Through Information Technology (Harvard Business School Press, Boston, 1993) 31. T.H. Davenport, J.E. Short, The new industrial engineering: information technology and business process redesign. Sloan Manag. Rev. 31(4), 11-27 (1990)
In BPMN
The most elementary form of relation is that of sequence, which implies that one event or activity A is followed by another event or activity B. Accordingly, the three most basic concepts of BPMN are events, activities, and arcs. Events are represented by circles, activities by rounded rectangles, and arcs (called sequence flows in BPMN) are represented by arrows with a full arrow-head. The latest version of BPMN is BPMN 2.0.2. It was released as a standard by the Object Management Group (OMG) in December 2013. In BPMN, activities are represented as rounded rectangles. Control nodes (called gateways) are represented using diamond shapes. Activities and control nodes are connected by means of arcs (called sequence flows) that determine the order in which the process is executed.
How do you differentiate between the responsibilities of managers?
The solution was to create functional units in which people with a similar focus on part of the production process were grouped together. These units were overseen by managers with different responsibilities. Moreover, the units and their managers were structured hierarchically. For example, groups are placed under departments, departments are placed under business units, etc.What we see here is the root of the functional units, which are still familiar to us today when we think about organizations: purchasing, sales, warehousing, finance, marketing, human resource management, etc.
Quote-to-order
This type of process typically precedes an order-to-cash process. It starts from the point when a supplier receives a Request for Quote (RFQ) from a customer and ends when the customer in question places a purchase order based on the received quote.
Process of Discovery
The use of data analysis to identify the activities involved in a current process which processes they are dealing with and which performance measures should be used, the next phase for the team is to understand the business process in detail. The identification of performance measures (and associated performance objectives) is crucial in any BPM initiative. This identification is generally seen as part of the process identification phase, although in some cases it may be postponed until later phases.
Process Redesign
To be process improvement as it's sometimes called and so if this pays we now have is to identify those changes of the process that really are gonna help us through any issues that we've identified such as things such as rework that we have to do and do that we're going to basically have identified multiple changes in provide options that we've analyzed and compared sort of in terms of looking at for all those performance measures and so process design is going to do that and through our process analysis help us together between those two and so the output of this phase is really typically to be our to be process models so we had and as I told you those two were fairly close hand-in-hand
Roles
collections of activities
quote-to-cash
combination of a quote-to-order and the corresponding order-to-cash
Industrial Times
Worker's focus: Single part of a process for a single product Worker's Capabilities: Pure Specialist
Structure process changes almost always involves
a change in resources
Process Architecture
a collection of inter-linked processes covering the bulk of the work that an organization performs in order to achieve its mission in a sustainable manner.
inherent process
a generalized set of standard processes typically follows standards within the industry contained within modules?
ERP Systems are much more than
a shared database. They also incorporate numerous modules to support typical functions of an organization such as accounting, inventory management, production planning, logistics, etc. However, from the perspective of process improvement, the shared database concept behind ERP systems is a major enabler.
Process Discovery
as is modeling at this particular point the current state of each of those processes is documented and we make sure that those processes are modeled
Process Performance Measures
before starting to analyze any process in detail, it is important to clearly define the process performance measures (also called process performance metrics) that will be used to determine whether a process is in good shape or in bad shape. Typical process performance measures relate to cost, time, quality, and flexibility. Process Performance Metrics
Identify and Analyze
begin to analyze what's taking place with respect to our current processes in place that is the the analysts that are in there doing that work they sort of analyze and the issues in other words analysts will go out and collect information about time spent on each task of the process and gather even more information regarding the amount of rework that takes place in a process if that's the case and we know even with that if we're dealing with rework then we're looking at several tasks that may be repeated because there is an issue that we're trying to identify so that analysis is very important in terms of making sure that we identify that and that the analyst comes in and is able to understand and it's typically a subject matter expert that understands that process and what that particular process is doing and providing for our organization and as part of that the analyst needs to go in and identify classify and understanding the main causes of any type of outcome positive or negative and make sure that ultimately if there are issues with that finding ways to eliminate or at least minimize what those issues are
basic activities model
create a model of your existing process (as is) create components - in this activity we sort of begin seeing team design changes to business processes sort of that at depth in detail sufficient for it implementation changes Implement Process Assess Results - continual review for effectiveness
CRM
customer relation management that is a suite of applications which includes things like a database inherent processes for managing all the actions associated with a customer everything from lead generation to customer service
site engineer
engineers working at a construction site
Purpose of engaging in a BPM initiative
ensure that the business processes covered by the BPM initiative lead to consistently positive outcomes and deliver maximum value to the organization in servicing its clients.
cross-organizational flowcharts
extensions of flowcharts Here, the flowchart is divided into so-called swimlanes, which denote different organizational units (e.g., different departments in a company).
A customer / stakeholder can be
internal or external
Kevin McCormack
investigated a sample of 100 US manufacturing organizations. He found that process-oriented organizations showed better overall performance, tended to have a better esprit de corps in the workplace, and suffered less from inter-functional conflicts. Helped revive BPR with A second important development was technological in nature. Different types of IT systems emerged,most notably Enterprise Resource Planning (ERP) systems and Workflow Management Systems (WfMSs).
Redesign
moving kind of from the as is to the to be process design as as as part of our process redesign settings and so it's important to keep in mind at that point that during our analysis in and redesign they are extremely related because we are taking as is processes either completely redoing them or modifying them and pulling them into our to be
external actors
operate outside the organization where the process is executed. For example the equipment supplier is an external actor (a.k.a. business party).
HR Director
plays a key role in processes that involve process participants
Process Methodologist
provides advice on methods, techniques, and software tools coordinates technical training
COO
responsible for defining the way operations are set up, sometimes Chief Process Officer CPO or Chief Process and Innovation Officer CPIO
CIO
responsible for operation of information system infrastructure
CFO
responsible for overall financial performance of the company
Quality of Service
service that meets or exceeds customer expectations
BPM Team
that is going to look at this and make sure that the team has some understanding in terms of the extent of what the process cycles are that we're gonna be working on and therefore understands that one of the primary things we're going to need to do is begin identifying the processes that are relevant to a problem that we're dealing with and therefore make sure that we limit our scope to those particular processes that we're dealing with now that could be large or that could be small it just depends on how we're dealing with that so not only the process is but also the relationship between those processes and with a mirror this is sort of that initial phase that we'll look at term process identification
outcomes
the execution of a process leads to one or several outcomes
customer
the one who consumes the output
internal actors
those who operate inside the organization where the process is executed. These actors are called process participants
We should embrace any technique that helps us
to improve business processes, whether or not this technique is perceived as being part of the BPM discipline (in the strict sense) and regardless of whether or not it uses process models.
integration in ERP allows
to know what it's doing from one functional area to another and this integration allows real-time updates both in terms of global issues that we're dealing with their global activities whenever and wherever that transaction takes place and critical business decisions then we can use that to make those critical business decisions make it on a timely basis using the latest information that we that we receive real time updates
Diagrams allow us
to more easily comprehend the process. Also, if a diagram is made using a modeling language that is understood by all stakeholders, there is less room for any misunderstanding. Note that these diagrams may still be complemented with textual descriptions. In fact, it is common to see analysts documenting a process using a combination of diagrams and text.
System Engineers
translate requirements into system design Responsible for implementation, testing, and deployment
negative outcome
value is not achieved or is only partially achieved
Ancient Times and Middle Ages
we move forward we started to see a civilization grew certainly people began to specialize in terms of the work that needed Worker Focus: Entire process for a single product Worker Capabilities: Intermediate Specialist This widespread development towards a higher level of specialism of the workforce culminated in the guilds of the craftsmen during the Middle Ages. These guilds were essentially groups of merchants and artisans concerned with the same economic activity, such as barbers, shoemakers, masons, surgeons, and sculptors. Workers in this time would have a good understanding of the entire process they were involved in, but knew little about the processes that produced the goods or services they obtained from others.
Prehistoric Times
we supported ourselves and originally in small groups where we were getting our own food or tools and other items and so from that perspective we understood that there we were our own consumers and producers so from a process standpoint it may not have been as as important that's what we're looking at is as a focus as it is today Worker Focus: Entire Process for all Products Worker's Capabilities : Pure Generalist
Discover and Model Processes
what are all of these as is process models that are already in place what are the outcomes associated with it what are the relations between those make sure that we clearly understand what we have with these as is process models that will basically provide us within the organization on how the work is to be done and again these process models are meant to really facilitate communications with all the stakeholders that are involved with this BPM initiative and so that is the importance of discovering these model processes
in the beginning most companies are concerned with their their core focus area
what are they doing in terms of if it's cells whether it's physical sales of inventory or services they're focused in that and therefore they they may not have an urgency in terms of making sure the processes are in place that's especially true for smaller organizations and companies that we're dealing with and quite frankly some companies simply do not have the process management skills in place to understand that they're having these hidden process issues and they're therefore they're not dealing with them
Six Sigma
A business process for improving quality, reducing costs, and increasing customer satisfaction is another set of practices that originate from manufacturing, in particular from engineering and production practices at Motorola. The main characteristic of Six Sigma is its focus on the minimization of defects (errors). Six Sigma places a strong emphasis on measuring the output of processes or activities, especially in terms of quality. Six Sigma encourages managers to systematically compare the effects of improvement initiatives on the outputs. Popular approach to blend Lean with Six Sigma leading to Lean Six Sigma
Activity
A distinct, scheduled portion of work performed during the course of a project. collection of related tasks that receive inputs and produce some sort of outputs can be performed either by humans only or humans augmented by computer systems or by the computer systems themselves takes time
Functional Organization
A hierarchical organization where each employee has one clear superior, and staff are grouped by areas of specialization and managed by a person with expertise in that area. emerged from the mindset of the Second Industrial Revolution, dominated the corporate landscape for the greatest part of the nineteenth and twentieth centuries. Towards the end of the 1980s, however, major American companies such as IBM, Ford, and Bell Atlantic (now Verizon) came to realize that their emphasis on functional optimization was creating inefficiencies in their operations that were affecting their competitiveness. Costly projects that introduced new IT systems or reorganized work within a functional department with the aim of improving its efficiency, were not notably helping these companies to become more competitive.
Unified Modeling Language (UML)
A language based on object-oriented concepts that provides tools such as diagrams and symbols to graphically model a system.
Event Node
A point in time, a milestone, representing the starting and finishing of one or more activities An event node tells us that something may or must happen, within the process or in the environment of the process, that requires a reaction, like for example the arrival of a message from a customer requesting the cancellation of purchase order.
Business Process Reengineering (BPR)
A radical redesign of a business process that improves its efficiency and effectiveness, often by beginning with a "clean sheet" (from scratch). "the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed." urged managers to look at entire, end-to-end processes when trying to improve the operations of their business, instead of looking at one particular task or business function. technology allowed organizations to begin to understand their processes a little better so organizations at least began to realize that their existing business processes needed to change in some way so that they could begin to understand the inefficiencies and how they can handle that a technological change may be moving from separate disparate databases that can move to a shared database and use more computer-based platforms and how they're doing their reporting focused on a single process or functional processes which sort of was the silo effect
claim-to-resolution
A variant of issue-to-resolution process can be found in insurance companies that have to deal with insurance claims.
Frederick W. Taylor, Scientific Management
A work published to describe that the application of the scientific method to the management of workers could improve productivity. Meticulously studying labor activities Work instruction for workers Managers oversee the productivity of groups of workers Units and their managers were structured hierarchically Functional organization remains dominant until the end of the 1980's
process participant
Actors can be internal or external. The internal actors are those who operate inside the organization where the process is executed.
Process Monitoring Phase
Analysts ought to scrutinize the data collected by monitoring the process in order to identify needed adjustments. we've got that redesign process running and we're collecting data as we do that then we begin to look at those performance measures that we had identified and see if we're meeting our associated objectives understand if there are issues with that do we have bottlenecks that we're dealing with are there deviations from what we had planned in terms of of the behavior of what we expected from our performance measures and then put the corrective actions in place that we need to take care of and understanding this model As Hammer once put it: "every good process eventually becomes a bad process", unless continuously adapted and improved to keep up with the ever-changing landscape of customer needs, technology and competition.
As-Is process models
Business process model that represents the current state of the operation that has been mapped, without any specific improvements or changes to existing processes Process models are meant to facilitate communication between stakeholders involved in a BPM initiative. Therefore, they have to be easy to understand. In principle, we could model a business process by means of textual descriptions, like the textual description in Example 1.1. However, such textual descriptions are cumbersome to read and easy to misinterpret because of the ambiguity inherent in free-form text. This is why it is common practice to use diagrams in order to model business processes.
How can a process be improved
Change process structure Change process resources Change both
Process Improvement
Change the process structure Change the process resources Both also - Performing an activity Augmenting human performing activity Controlling data quality change in a process structure okay so maybe in some cases process quality can be changed just by reorganizing the process itself okay so so changing that process structure can also in and of itself increase process effectiveness or change the process resources okay so so business process activities they're accomplished by either human or informational systems in one way for improving process quality is to change the allocation of those resources and then we could change both there's that maybe there's an opportunity that possibly we can improve process quality by changing both the processes structure and the respawn resources
BPM Lifecycle
Clarify - which business processes do we aim to improve Initial phase - process identification > Process Discovery > Process Analysis > Process redesign / improvement > Process implementation > process monitoring
BPR failures
Concept misuse During the 1990s, many corporations initiated considerable reductions of their workforce (downsizing) which, since they were often packaged as process redesign projects, triggered intense resentment among operational staff and middle management against BPR. After all, it was not at all clear that operational improvement was really driving such initiatives. Over-radicalism While a radical approach may be justified in some situations, it is clear that many other situations require a much more gradual (incremental) approach. Support immaturity people ran into the problem that the necessary tools and technologies to implement such a new design were not available or insufficiently powerful. unfortunately a lot of the business process reengineering it's it's difficult slow and it's very very expensive so as they move forward they began to see that many of the early projects started down this road stall when we the enormity of dealing with this project and the cost of this became very apparent and so it sort of left many organizations that were dealing with that with only partially implemented systems available there which had in most case disastrous consequences
Improvement Initiatives can be
Continuous or incremental or radical
Benefits of BPM
Dynamic distribution of work Work monitoring Applications can be automatically invoked during process execution standardization of non-standardized processes improvement of process efficiency Reduction in time to complete workflows and increase in their quality reduction in human resources - moving away from manual to automatic / autonomous better ability to cope with and handle changes to process make sure that our level management is on board and pushing that down increase in relevance of existing IT systems within an organization meaning do we have an IT in place that can support this if not then we're going to have to look and see again cost-benefit perspective if that's an approach we want to take
Event Driven Process Chain (EPC)
EPCs have some similarities with flowcharts but they differ from flowcharts in that they treat events as first-class citizens.
Events
Events correspond to things that happen automatically, which means that they have no duration. for example the the arrival of a piece of equipment at a construction site that's an event and then at that point the event itself may trigger the execution of a series of activities
Silo Effect
Focusing on functional objectives without regard to process objectives because of maybe the fact that we are working in a functional focus then we begin to derive problems from that there are called silo effects that is we can have data duplications or data inconsistency and therefore that increases our in data integrity issues and problems that we're dealing with specific to processes can begin to build into isolated decisions by management that can lead to organizational inefficiencies and of course higher costs
Reasons to change process
Improve Process Quality Adapt to change in technology Adapt to change in business fundamentals
BPR Characteristics
Integrated data, enterprise linked systems create stronger, faster, more effective linkages in value chains Difficult, slow, exceedingly expensive Key personnel determine how best to use new technology Requires high-level and expensive skills and considerable time
Business Process
Network of activities, repositories, roles, resources, and flows which interact to accomplish a business function that is of value to the organization or its customers business process as a collection of interrelated events activities decision points that involve a number of actors and objects which collectively lead to the outcome that is of value to at least one customer
Intermediate Specialist
People started to specialize in the art of delivering one specific type of goods, such as pottery, or providing one particular type of service, such as lodging for travelers. This widespread development towards a higher level of specialism of the workforce culminated in the guilds of the craftsmen during the Middle Ages. These guilds were essentially groups of merchants and artisans concerned with the same economic activity, such as barbers, shoemakers, masons, surgeons, and sculptors. Workers in this time would have a good understanding of the entire process they were involved in, but knew little about the processes that produced the goods or services they obtained from others.
Inter-enterprise
Support one or more inter-enterprise processes. 1,000+ users; systems procedures formalized; problem solutions affect multiple organizations; can resolve problems of duplicated enterprise data; very difficult to change
Workgroup
Support one or more workgroup processes. 10 - 100 users; procedures often formalized; problem solutions within group; workgroups can duplicate data; somewhat difficult to change workgroup again that's more of a functional level so at the workgroup process that really exists to enable a functional workgroup to fulfill whatever their charter purpose or goal of that particular functional department
Enterprise
Support one or more enterprise processes. 100 - 1,000+ users; procedures formalized; problem solutions affect enterprise; eliminate workgroup data duplication; difficult to change span an organization and and support the activities in multiple departments Enterprise Information Systems can support one or more of these enterprise processes
Structured Process
Support operational and structured managerial decisions and activities Standardized Usually formally defined and documented Exceptions rare and not (well) tolerated Process structure changes slowly and with organizational agony involve day-to-day operations for example like accepting a return placing an order of purchasing raw material
Dynamic Process
Support strategic and less structured managerial decision and activities Less specific, fluid Usually informal Exceptions frequent and expected Adaptive processes that change structure rapidly and readily normally involve strategic and less structured managerial decisions and activities that's us such as deciding whether to open a new store or create a new product line usually require more or less human judgment less autonomous in in their nature
Process Analysis
The identification and assessment of issues and opportunities for process improvement issues that we have associated with the as is process that I've talked about we identify those we document those we bring in the subject matter experts and if we can we quantify any of those so that we can build our performance measures associated with that so that ultimately the output is sort of a collection of all these issues and concerns and problems that we have associated with those those particular processes that we're dealing with By identifying, classifying, and understanding the main causes of such negative outcomes, the analyst can ultimately find ways of eliminating or minimizing them. The identification and assessment of issues and opportunities for process improvement is called the process analysis phase.
Managers
The people responsible for supervising the use of an organization's resources to meet its goals Managers were responsible for pinning down the productivity goals for individual workers and making sure that such goals were met. In contrast to the masters of the medieval guilds, who could only attain such a rank on the basis of a masterpiece produced by themselves, managers are not necessarily experts in carrying out the job they oversee. Their main interest is to optimize how a job is done with the resources under their supervision.
ERP (Enterprise Resource Planning)
The primary purpose of ERP system is integration a suite of applications called modules, a database, and a set of inherent processes for consolidating business operations into a single, consistent, computing platform ERP systems are essentially systems that store all data related to the business operations of a company in a consistent manner, so that all stakeholders who need access to these data can gain such access. This idea of a single shared and centralized database enables the optimization of information usage and information exchanges, which is a key enabler of process improvement
order to cash
This is a type of process performed by a vendor, which starts when a customer submits an order to purchase a product or a service and ends when the product or service in question has been delivered to the customer and the customer has made the corresponding payment. that type of process encompasses activities related to things such as purchase order verification and shipment delivery and invoicing and payment received and acknowledgement
Issue-to-resolution
This type of process starts when a customer raises a problem or issue, such as a complaint related to a defect in a product or an issue encountered when consuming a service. The process continues until the customer, the supplier, or preferably both of them agree that the issue has been resolved.
Application-to-approval
This type of process starts when someone applies for a benefit or privilege and ends when the benefit or privilege in question is either granted or denied. This type of process is common in government agencies, for example when citizens apply for building permits or when entrepreneurs apply for business licenses (e.g., to open a restaurant). Another process that falls into this category is the admissions process in a university,which starts when a student applies for admission into a degree program. Yet another example is the process for approval of vacation or special leave requests in a company.
Procure to Pay
This type of process starts when someone in an organization determines that a given product or service needs to be purchased. It ends when the product or service has been delivered and paid for. A procure-to-pay process includes activities such as obtaining quotes, approving the purchase, selecting a supplier, issuing a purchase order, receiving the goods (or consuming the service), and paying the invoice. A procure-to-pay process can be seen as the counterpart of the quote-to-cash process in the context of business-to-business interactions.
Improvement
Typical examples of improvement objectives include reducing costs, reducing execution times, and reducing error rates, but also gaining competitive advantage through innovation. Improvement initiatives may be one-off or of a continuous nature; they may be incremental or radical.
Difference between BPR and BPM
While both approaches take the business process as a starting point, BPR is primarily concerned with planning and organizing the process. By contrast, BPM provides concepts, methods, techniques, and tools that cover all aspects of managing a process—to plan, organize, and monitor it—as well as its actual execution. In other words, BPR should be seen as a subset of techniques that can be used in the context of BPM.
BPM
a body of principles, methods, techniques, and tools to identify, discover, analyze, redesign, execute, and monitor business processes in order to optimize their performance. art and science of overseeing how work is performed in an organization to ensure consistent outcomes and take advantage of improvement opportunities
Repository
a collection of something from a database standpoint we could have data as a repository or if we have inventory that is a physical repository
TQM (Total Quality Management)
a collection of techniques designed to improve the responsiveness of the organization to the demands of customers The focus of TQM is on continuously improving and sustaining the quality of products, and by extension also of services. In this way, it is similar to BPM in its emphasis on the necessity of ongoing improvement efforts. But where TQM puts the emphasis on the products and services while BPM focuses on the improvement of process and that the quality of products and services can best be achieved by focusing on the improvement of the processes that create these products and deliver these services. TQM = manufacturing BPM = service organizations
Data Flow Diagram (DFD)
a graphical description of the flow of data within an organization, including data sources/destinations, data flows, transformation processes, and data storage
Business Process Model and Notation
a graphical notation that depicts the steps in a business process
process efficiency
a measure of the ratio of process outputs to inputs
workflow management system
a system that stores workflow definitions as a collection of tasks, resources, and conditional logic WfMSs, on the other hand, are systems that distribute work to various actors in a company on the basis of process models. By doing so, a WfMS makes it easier to implement changes to business processes (e.g., to change the order in which steps are performed). Indeed, the changes made in the process model can be put into execution with relative ease, as compared to the situation where the rules for executing the process are hard-coded inside complex software systems and buried inside tens of thousands of lines of code. Also, aWfMS very closely supports the idea of working in a process-centered manner. Originally, WfMSs were concerned mainly with routing work between human actors. Later on, these systems were gradually extended with modules to monitor and analyze the execution of business processes. In parallel, the emergence of Web services made it easier to connect a WfMS with other systems, in particular ERP systems. As WfMSs became more sophisticated and better integrated with other enterprise systems, they became known as Business Process Management Systems (BPMSs).
BPR includes
activity in and of itself some altering existing and designing new business processes take advantage of new information systems
external actor
actors operate outside the organization where the process is executed
Swimlane
an activity diagram component that divides the workflow activities into groups showing which agent performs which activity this is a format in terms of each role of the business process is given its own swim lane
processes begin as soon as
an organization starts
human only (manual)
cannot be automated
flexibility
capture the extent to which the performance of a process is maintained under changing or abnormal conditions, for example when a works engineer resigns suddenly or when a supplier goes bankrupt.
Control Nodes
capture the flow of execution between activities (called gateways) are represented using diamond shapes
Other languages used for process modeling
data-flow diagrams and Integrated DEFinition for Process Description Capture Method (IDEF3)
Control Flow
directs the order of activities (What needs to be done and when?) part of the control flow that helps us in making that determination what do we need to work on what objects what are they physical or they electronic what activities of those physical objects are we looking at and who's doing the work Solid line arrow ->
Informational Objects
electronic documents and electronic records
Physical objects
equipment, materials, products, paper documents
Generalists
had knowledge of how to produce many different things. In other words, they were generalists.
process effectiveness
how well a process achieves organizational strategy
Actors
including human actors, organizations, or software systems acting on behalf of human actors or organizations organizational actors would be the businesses involved
process identification
identifying the processes that are relevant to the problem on the table, delimiting the scope of these processes, and identifying relations between these processes. basically defining our business problem what it is and and how we need to identify those relevant processes that we talk about we need identify them what they're going to be doing what sort of updates do we need what architecture pieces are going to be affected by this as we move forward
Management tries to understand and seek to
improve quality adapt to change in technology - are we changing our strategies of our organization and our company to meet these technology changes adapt to change in business fundamentals
process automation
involves the configuration or implementation of an IT system (or the re-configuration of an existing IT system) to support the to-be process.
Lean
is a management discipline that originates from the manufacturing industry, in particular from the Toyota Production System. One of the main principles of Lean is the elimination of waste, i.e., activities that do not add value to the customer The customer orientation of Lean is similar to that of BPM and many of the principles behind Lean have been absorbed by BPM. In that sense, BPM can be seen as a more encompassing discipline than Lean. BPM = emphasis on use of IT as a tool to improve business processes and to make them more consistent and repeatable
High level goals of management of BPM
management wants to: get a holistic view on how an organization works understand activities of an organization and their relations understand embedding of activities within an organization and technical context drives : potential for improving the business process
BPM is not about improving the way individual activities are performed. Rather, it is about
managing entire chains of events, activities, and decisions that ultimately add value to the organization, and its customers. These chains of events, activities, and decisions are called processes.
process as a service
meaning we can build a service-oriented top architecture that handles a process and move that into a service in other words a service may equal a type or several types of processes
Data Flow
movement of data among activities and repositories - dashed line arrow --->
Activity-on-Node (AON)
network diagram convention in which nodes designate activities Activity nodes describe units of work that may be performed by humans or software applications, or a combination thereof.
Process Quality
one of the most important determinant of definitely an organizational success 2 dimensions Efficiency Effectiveness
Task
one single unit of work when an activity is is simple and it can be seen in say a single unit of work that is called a task and in project management we begin looking at and evaluating and deriving the lowest level tasks an atomic part of the process a fine-grained unit of work performed by a single process participant, while the term activity is used to refer to both fine-grained or coarse-grained units of work.
partial
other words maybe human does part of it and automation or computing systems report
positive outcome
outcome that delivers value to the actors involved
Resources
people or computer applications that are assigned to roles (who's doing the work? human & systems) that are assigned specific roles
decision point
points in time when a decision is made that affects the way the process is executed when a decision is made that affects the way this process is going to be executed so for example if we have an inspection at a side and the side engineer may decide that the equipment should be returned or that the equipment should be accepted those are decision points part of the key critical decision points in there is during testing phases does this test correctly are we getting the results we want if so then we're good if or not and let's move back and let the application side begin updates and so we go through this critical process and again that could be part of your quality piece of its quality engineering is looking at this and checking
functional focus
process that we are doing we focus on our particular discipline that we're dealing with that is processes associated with accounting functions if we're working with our financial functions or management functions and therefore our processes are derived because we have that focus on our particular functional area
Organizational Change Management
refers to the set of activities required to change the way of working of all participants involved in the process. These activities include: • Explaining the changes to the process participants to the point that they understand both what changes are being introduced and why these changes are beneficial to the company. • Putting in place a change management plan so that stakeholders know when the changes will come into effect and what transitional arrangements will be employed to address problems during the transition to the to-be process. • Training users to the new way of working and monitoring the changes in order to ensure a smooth transition to the to-be process.
Pure Specialist
single part of a process for a single product
Scientific Management
studying workers to find the most efficient ways of doing things and then teaching people those techniques
Suppliers & Partners impact
suppliers and partners can be dealing with financial aspects HR technology material
Process Owner
the person responsible for the end-to-end functioning of a business process concerned with planning and organizing the process on the one hand and monitoring the process on the other. they're concerned with the planning and organizing the process and monitoring and making sure that that process follows the way it's supposed to need updates are needed if there are the changes that need to be made it then we do that
Operations Management (OM)
the set of activities that create value in the form of goods and services by transforming inputs into outputs a field concerned with managing the physical and technical functions of a firm or organization, particularly those relating to production and manufacturing. Uses Probability theory, queuing theory, decision analysis, mathematical modeling, and simulation are all important techniques for optimizing the efficiency of operations from this perspective. OM = Concerned with controlling an existing process BPM = making changes to existing process in order to improve it
business environment
the surrounding factors that either help or hinder the development of businesses dealing with the economy or politics regulatory or the culture within the business environment
cycle time
the time needed to complete a process
process architecture
the types of resources used to perform the activities and their physical layout in the processing network a collection of inter-linked processes covering the bulk of the work that an organization performs in order to achieve its mission in a sustainable manner.
Principles of BPM
understanding - do we really know how work actually gets documentation - is the intellectual capital embedded in our processes secure Innovation - are we continuously improving organization performance Control - do we have control over the things that really matter, are we focused on the right things Transparency - Are our operations suitably transparent and audible to all stakeholders Compliance - are we meeting our obligations both internal and external Productivity - are we making the most of time, money, and opportunities do we have efficient processes in place that allow this Agility - are we able to respond to demands and opportunities Satisfaction - are our customers and staff happy enough
Examples of change in business fundamentals
• Market (new customer category, change in customer characteristics) • Product lines • Supply chain any occurrence associated with supply chains extremely important because that is one of the reasons that we deal with a lot of our for example inventory understanding our inventory and a change in supply chain might mean that the company longer no longer stocks some type of items in inventory but but ships them directly to a manufacturer • Company policy • Company organization (merger, acquisition) • Internationalization • Business environment (new priority on credit checking) the way that we handle our accounting or finance or marketing procedures
