Summary Business Process Management (KUL)

BUSINESS PROCESS MANAGEMENT
PART 1: INTRODUCTION TO BPM

1. BPM
= Body of principles, methods and tools to design, analyze, execute, and monitor business processes
 PURPOSE = improve these businesses ≠ how to automate them

Physical flows → digital flows  digitization  efficient management of BP requires a lot of tools




 2 approaches to engage in BPM

1) Continuous process improvement (CPI)
- Does not put into question the current process structure
- Seeks to identify issues + resolve them incrementally one fix at a time
2) Business process re-engineering (BPR)
- Puts into question the fundamental assumptions and principles of existing structure
- Aims to achieve breakthrough e.g. removing costly tasks that don’t add value

BUSINESS PROCESSES =

Collection of related events, activities and decisions, that involve a number of actors and objects, and
that collectively lead to an outcome that is of value to an organization or its customers

e.g. order-to-cash, quote-to-order, procure-to-pay, etc.

• There ≠ single right way of modelling a certain BP e.g. washing machine reparation
• Every process leads to one or several outcomes = end events
o Positive outcomes – deliver value e.g. fault repaired without intervention
o Negative outcomes – reduce value e.g. fault not repaired + request withdrawn
! First look at what outcomes you want for the BP (will improve modeling)
• Don’t add much elements  only if necessary to understand control/resource flow

 Core elements of a process

Activities = active elements e.g. enter sales order
→ time-consuming + resource-demanding + state-changing

Events = passive elements e.g. sales order has been entered
→ represent conditions/circumstances + are atomic, instantaneous

Business objects (data) = organizational artifacts that undergo state changes e.g. sales order
→ physical or electronic information

Actors (resources) = entities performing process activities + generating events e.g. supplier, ERP
→ human and systems


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, Process perspectives

I. Control flow perspective – “what needs to be done and when”
- Predecessor/successor relationship among activities and events
- The central information depicted in a process model
II. Data perspective – “what do we need to work on”
- Input/output data to activities
- Complements the control flow
III. Resource perspective – “who’s doing the work”
- Human participants + systems that perform control flow activities & generate events
- Complements the control flow




2. THE BPM LIFECYCLE




2.1 Process identification
PROCESS IDENTIFICATION = only step that doesn’t focus on single BP  looks at entire landscape
✓ Define an organization’s business processes
✓ Establish criteria to prioritize the management of these processes

 PURPOSE = understand the organization + max the value of its BPM initiatives
OUTPUT = process architecture

1) Captures BPs and their scope
2) Serves as framework for defining priorities and scope of subsequent BPM phases
3) Offers a ranking for all BPs + indication whether its useful to improve these

Process identification steps
Step 1 Designation phase
• Enumerate main processes “Which BPs are present in a particular business?”
• Determine process scope “Starting point, ending point & who is involved?”
o Boundaries – horizontal and vertical
o Interrelationships – order and hierarchy
 Designation via reference models e.g. APQC Process Classification Framework (PCF)
- Industry-neutral enterprise model for benchmarking
- 4 levels: categories, process group, process, activity
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, Step 2 Evaluation phase = process selection
• Objectives
o Alignment with strategic objectives
o Culture & politics
o Feasibility to being successfully improved
o Risk of not improving them
o health: performance, compliance, sustainability…
• Process portfolio management
1) Importance: which processes have the greatest impact on strategic goals?
2) Dysfunction: which processes are in the deepest trouble?
3) Which process is the most susceptible to successful process management?
= subjective opinion!

2.2 Process discovery: as-is process modelling
Build a visual process model that details how process is laid out in the organization

 PHASES
Phase 1 Defining the setting – assembling organiz team responsible for working on process
Phase 2 Gathering information – building an understanding of the process
→ ≠ discovery methods can be used to acquire info on a process
Phase 3 Conducting the modelling task – organizing the creation of the process model
→ modelling method gives guidance for mapping out the process in a systematic way
See later Phase 4 Assuring process model quality – guarantee resulting models meet ≠ quality criteria
= important for establishing trust in process model

 Who is involved?  extract info from relevant people involved in the process




! CHALLENGES
 Fragmented process knowledge: no one has entire overview of the process  ≠ views
 Domain experts think on instance level: “Every customer (instance) is different”
 ito a process they are very similar
 Knowledge about process modelling is rare: extracting real-life info from BPS = complex
→ need to translate this for people who don’t understand it = inefficient

 ELICITATION TECHNIQUES = techniques used to extract info

1) Evidence-based
• Document analysis: documents point to existing roles, activities + business objects
→ formal (e.g. organization chart, internal policies), forms, or work instructions
• Observation: observe what people do at workplace + trace business objects over time
• Process mining: automated process discovery  log files capture activities + time
→ visualize process models e.g. Disco
2) Interview-based: structured vs unstructured
!! assumption: analyst and stakeholders share terminology
3) Workshop-based: stakeholders interact to create model
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,  Strengths and weaknesses of each technique




 Organizing the gathered info – use steps to guarantee modeling at same level of granularity

1) Identify the process boundaries
• Under which condition does the process start?
• With which result does it end? = outcomes.
• Which perspective do you assume

2) Identify activities and events  first list these before you add control flow




3) Identify resources and their handovers




4) Identify the control flow




5) Identify additional elements




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