BPM1: Introduction to Business Process
Management (BPM)
Contents
1 The World of BPM 2
1.1 Definition and Goal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 The Role of Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Ways to Engage in BPM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2 Business Processes: Core Concepts 2
2.1 Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Outcomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Core Elements of a Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.4 Process Perspectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3 The BPM Lifecycle 3
4 Phase 1: Process Identification 3
4.1 Goal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4.2 Steps in Process Identification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.3 Process Enumeration (Designation) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.4 Process Scoping (Architecture) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.5 Reference Models . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.6 The Evaluation Phase (Selection) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5 Phase 2: Process Discovery 5
5.1 Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.2 The Discovery Steps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.3 Roles Involved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.4 Key Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.5 Elicitation Techniques – I think important . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.6 Conducting the Modeling Task . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
What should you be know and what should you be able to do?
You should know:
• how a business process is defined, what the core elements are of a business process are and what
the field of BPM is about
• the di!erent phases in the BPM life cycle, give examples of activities and techniques used in each
of these phases
• what process identification is and how designation and evaluation of business processes serves as a
starting point for BPM initiatives
• what process discovery (= as-is process modelling), who is involved, what the challenges are, what
techniques are used, what their strengths and weaknesses are, and which steps should be undertaken
for modelling as-is processes
You should be able to:
• contrast and compare di!erent elicitation techniques for process modelling
1
,1 The World of BPM
1.1 Definition and Goal
Business Process Management (BPM) is a body of principles, methods, and tools to design, analyze,
execute, and monitor business processes.
1.2 The Role of Technology
Technology evolves the flow of work from classical (manual/industrial) to electronic (IT-driven). How-
ever, technology alone is not the solution.
• The First Rule of Technology (Bill Gates): Automation applied to an e!cient operation will
magnify the e!ciency.
• The Second Rule of Technology: Automation applied to an ine!cient operation will magnify
the ine!ciency.
• Key Relationship: Information Technology → Enables Process Change → Yields Business Value.
(Process Change is crucial)
1.3 Ways to Engage in BPM
There are two primary approaches to changing processes:
Continuous Process Improvement (CPI) Business Process Re-Engineering (BPR)
Does not question the current process struc- Puts into question fundamental assump-
ture. tions and principles.
Identifies issues and resolves them incremen- Aims to achieve breakthroughs (e.g., remov-
tally (step-by-step). ing costly non-value-add tasks).
Table 1: CPI vs. BPR
2 Business Processes: Core Concepts
2.1 Definition
A Business Process is a collection of related events, activities, and decisions involving a number of
actors and objects, which collectively lead to an outcome of value to a customer.
• Examples: Order-to-Cash, Procure-to-Pay, Issue-to-Resolution.
”If it does not make at least three people mad, it’s not a process.” (Hammer and
Stanton)
2.2 Outcomes
Every process leads to outcomes:
• Positive outcomes: Deliver value.
• Negative outcomes: Reduce value.
2.3 Core Elements of a Process
Activities: Active elements (e.g., ”Enter sales order”). They are time-consuming, resource-demanding,
and state-changing.
Events: Passive elements (e.g., ”Sales order entered”). They represent conditions/circumstances and
are atomic/instantaneous.
2
,Business Objects (Data): Organizational artifacts that undergo state changes (e.g., physical or digi-
tal orders).
Actors (Resources): Entities performing activities (Humans or Systems/Software).
2.4 Process Perspectives
To model a process, three perspectives are combined:
1. Control Flow: What needs to be done and when? (Predecessor/successor relationships).
2. Data Perspective: What do we need to work on? (Input/output data).
3. Resource Perspective: Who is doing the work? (Humans and systems).
3 The BPM Lifecycle
The lifecycle is a continuous cycle used to manage processes. (The image with the circular form and
process identification at the top)
1. Process Identification: Identifying processes and prioritizing them.
2. Process Discovery: Modeling the ”As-is” process. → BPM 2-6
3. Process Analysis: Finding insights on weaknesses. → BPM 7-8
4. Process Redesign: Creating the ”To-be” process model. → BPM 9
5. Process Implementation: Creating executable process models. → BPM 10
6. Process Monitoring and Controlling: Conformance and performance checks. → BPM 11-13
Figure 1: The BPM Lifecycle
4 Phase 1: Process Identification
4.1 Goal
To understand the organization, identify its business processes, and prioritize management based on
specific criteria.
3
, 4.2 Steps in Process Identification
1. Designation Phase: Enumerate main processes and determine scope (Process Architecture).
2. Evaluation Phase: Prioritize processes (Process Selection, Prioritized Process Portfolio).
4.3 Process Enumeration (Designation)
According to Porter, processes are classified into three types:
1. Core Processes: Generate value directly linked to external customers (e.g., Sales, Distribution,
Production). ”Sell stu!, Deliver stu!.”
2. Support Processes: Provide resources to be used by other processes (e.g., HR, IT, Finance/Accounting,
Indirect Procurement).
3. Management Processes: Provide direction, rules, and practices (e.g., Strategic Management,
Risk Management, Supplier Management).
Figure 2: Core, Support, and Management Processes according to Porter. Exercises and examples in
slides
4.4 Process Scoping (Architecture)
Understanding interrelations between processes.
• Specialization General – special product/service
• Horizontal Scoping (Value Chains): Upstream to downstream flow. A chain of processes
delivering value.
– Rules for horizontal boundaries: Change of key business object, change of granularity, change
in frequency/time, or change in intermediate outcome.
– Typical Core Value Chain: Imagine it → Build it → Sell it. (Specializations exist for Make-
to-Stock vs. Make-to-Order vs. Engineer-to-Order).
• Vertical Scoping (Hierarchy): Main processes broken down into sub-processes.
– Level 1: Process Landscape (High level, Value Chain).
– Level 2: Main Processes (Abstract, build up value chains).
– Level 3: Subprocesses (Detailed, multiple activities).
– Level 4: Process Tasks (Atomic, performed by one person/system).
4.5 Reference Models
Templates used to design process architecture (standardized industry models).
• Examples: ITIL (IT), SCOR (Supply Chain), PCF (Process Classification Framework by APQC),
eTOM (Telecom).
• APQC PCF: Four levels (Category → Process Group → Process → Activity).
4
Management (BPM)
Contents
1 The World of BPM 2
1.1 Definition and Goal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 The Role of Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Ways to Engage in BPM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2 Business Processes: Core Concepts 2
2.1 Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Outcomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Core Elements of a Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.4 Process Perspectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3 The BPM Lifecycle 3
4 Phase 1: Process Identification 3
4.1 Goal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4.2 Steps in Process Identification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.3 Process Enumeration (Designation) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.4 Process Scoping (Architecture) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.5 Reference Models . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.6 The Evaluation Phase (Selection) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5 Phase 2: Process Discovery 5
5.1 Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.2 The Discovery Steps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.3 Roles Involved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
5.4 Key Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.5 Elicitation Techniques – I think important . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.6 Conducting the Modeling Task . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
What should you be know and what should you be able to do?
You should know:
• how a business process is defined, what the core elements are of a business process are and what
the field of BPM is about
• the di!erent phases in the BPM life cycle, give examples of activities and techniques used in each
of these phases
• what process identification is and how designation and evaluation of business processes serves as a
starting point for BPM initiatives
• what process discovery (= as-is process modelling), who is involved, what the challenges are, what
techniques are used, what their strengths and weaknesses are, and which steps should be undertaken
for modelling as-is processes
You should be able to:
• contrast and compare di!erent elicitation techniques for process modelling
1
,1 The World of BPM
1.1 Definition and Goal
Business Process Management (BPM) is a body of principles, methods, and tools to design, analyze,
execute, and monitor business processes.
1.2 The Role of Technology
Technology evolves the flow of work from classical (manual/industrial) to electronic (IT-driven). How-
ever, technology alone is not the solution.
• The First Rule of Technology (Bill Gates): Automation applied to an e!cient operation will
magnify the e!ciency.
• The Second Rule of Technology: Automation applied to an ine!cient operation will magnify
the ine!ciency.
• Key Relationship: Information Technology → Enables Process Change → Yields Business Value.
(Process Change is crucial)
1.3 Ways to Engage in BPM
There are two primary approaches to changing processes:
Continuous Process Improvement (CPI) Business Process Re-Engineering (BPR)
Does not question the current process struc- Puts into question fundamental assump-
ture. tions and principles.
Identifies issues and resolves them incremen- Aims to achieve breakthroughs (e.g., remov-
tally (step-by-step). ing costly non-value-add tasks).
Table 1: CPI vs. BPR
2 Business Processes: Core Concepts
2.1 Definition
A Business Process is a collection of related events, activities, and decisions involving a number of
actors and objects, which collectively lead to an outcome of value to a customer.
• Examples: Order-to-Cash, Procure-to-Pay, Issue-to-Resolution.
”If it does not make at least three people mad, it’s not a process.” (Hammer and
Stanton)
2.2 Outcomes
Every process leads to outcomes:
• Positive outcomes: Deliver value.
• Negative outcomes: Reduce value.
2.3 Core Elements of a Process
Activities: Active elements (e.g., ”Enter sales order”). They are time-consuming, resource-demanding,
and state-changing.
Events: Passive elements (e.g., ”Sales order entered”). They represent conditions/circumstances and
are atomic/instantaneous.
2
,Business Objects (Data): Organizational artifacts that undergo state changes (e.g., physical or digi-
tal orders).
Actors (Resources): Entities performing activities (Humans or Systems/Software).
2.4 Process Perspectives
To model a process, three perspectives are combined:
1. Control Flow: What needs to be done and when? (Predecessor/successor relationships).
2. Data Perspective: What do we need to work on? (Input/output data).
3. Resource Perspective: Who is doing the work? (Humans and systems).
3 The BPM Lifecycle
The lifecycle is a continuous cycle used to manage processes. (The image with the circular form and
process identification at the top)
1. Process Identification: Identifying processes and prioritizing them.
2. Process Discovery: Modeling the ”As-is” process. → BPM 2-6
3. Process Analysis: Finding insights on weaknesses. → BPM 7-8
4. Process Redesign: Creating the ”To-be” process model. → BPM 9
5. Process Implementation: Creating executable process models. → BPM 10
6. Process Monitoring and Controlling: Conformance and performance checks. → BPM 11-13
Figure 1: The BPM Lifecycle
4 Phase 1: Process Identification
4.1 Goal
To understand the organization, identify its business processes, and prioritize management based on
specific criteria.
3
, 4.2 Steps in Process Identification
1. Designation Phase: Enumerate main processes and determine scope (Process Architecture).
2. Evaluation Phase: Prioritize processes (Process Selection, Prioritized Process Portfolio).
4.3 Process Enumeration (Designation)
According to Porter, processes are classified into three types:
1. Core Processes: Generate value directly linked to external customers (e.g., Sales, Distribution,
Production). ”Sell stu!, Deliver stu!.”
2. Support Processes: Provide resources to be used by other processes (e.g., HR, IT, Finance/Accounting,
Indirect Procurement).
3. Management Processes: Provide direction, rules, and practices (e.g., Strategic Management,
Risk Management, Supplier Management).
Figure 2: Core, Support, and Management Processes according to Porter. Exercises and examples in
slides
4.4 Process Scoping (Architecture)
Understanding interrelations between processes.
• Specialization General – special product/service
• Horizontal Scoping (Value Chains): Upstream to downstream flow. A chain of processes
delivering value.
– Rules for horizontal boundaries: Change of key business object, change of granularity, change
in frequency/time, or change in intermediate outcome.
– Typical Core Value Chain: Imagine it → Build it → Sell it. (Specializations exist for Make-
to-Stock vs. Make-to-Order vs. Engineer-to-Order).
• Vertical Scoping (Hierarchy): Main processes broken down into sub-processes.
– Level 1: Process Landscape (High level, Value Chain).
– Level 2: Main Processes (Abstract, build up value chains).
– Level 3: Subprocesses (Detailed, multiple activities).
– Level 4: Process Tasks (Atomic, performed by one person/system).
4.5 Reference Models
Templates used to design process architecture (standardized industry models).
• Examples: ITIL (IT), SCOR (Supply Chain), PCF (Process Classification Framework by APQC),
eTOM (Telecom).
• APQC PCF: Four levels (Category → Process Group → Process → Activity).
4
