Lesson 1
What is BPM?
The evolution of BPM
What is BPM?
• BPM: a concept based on the observation that each product that a
company provides to the market is the outcome of a number of
activities performed.
• BPM is a disciplined approach to identify, design, execute, document,
measure, monitor, and control both automated and non-automated
business processes to achieve consistent, targeted results aligned
with organizational strategic goals.
• Business processes: are the key instrument to organizing these
activities and to improving the understanding of their
interrelationships.
BPM and Information Systems (IS)
• Information technology (IT) in general and information systems (IS) in
particular deserve an important role in business process management
• Why? Because more and more activities that a company performs are
supported by IS.
Manual and Automated BPs
• Business process activities can be performed by the company’s
employees manually or by the help of information systems.
Examples?...................................................................
• There are also business process activities that can be enacted
automatically by IS, without any human involvement.
Examples?...................................................................
Interplay between IS and BP to achieve
business goals
• A company can reach its business goals in an efficient and effective
manner only if people and other enterprise resources, such as IS, play
together well.
Reflective questions:
- Do the people do what they are supposed to do?
- Do systems behave the way they are supposed to?
• Business processes are an important concept to facilitating this
effective collaboration
BPM background
• Business process management is influenced by concepts and
technologies from different areas of business administration and
computer science.
• Based on early work in organization and management, business
process management has its roots in the process orientation trend of
the 1990s,
• Process Orientation is defined a new way of organizing companies on
the basis of business processes that they used to achieve their
company business goals.
• Lets look into ore detail at the evolution of BPM
BPM Evolution
• BPM has been around longer than you can imagine and can be
summarized into three distinct waves:
a) Industrial Age
b) Information Age
- 1st Wave – Process Improvement
- 2nd Wave – Process Re-engineering
- 3rd Wave – Business Process Management
Industrial Age
PDCA stand for: Plan, Do, Check, Act.
A four-stage model for continuous improvement and problem-solving
Information age: 1st Wave – Process
Improvement
A line of business (LOB): a specific area/segment within a company focusing on a particular set of related products
or services to allow for focused resource allocation and strategic management e.g. Sales & marketing, HR, Finance,
Logistics etc
Material Requirements Planning (MRP): a software solution that helps manufacturers calculate more precisely
what materials they require, at what time, and in what quantities.
Information Age: 2nd Wave – Process Re-engineering
Six Sigma Methodology: a data-driven methodology for process improvement aiming to minimize defects and
variability in manufacturing and business processes by using statistical methods and quality management techniques,
with the goal of achieving perfect quality products and services.
Information Age: 3rd Wave – Business Process
Management
Co-sourcing: combines elements of insourcing and outsourcing, involving a collaborative approach where
a company retains some control while leveraging external expertise.
Insourcing: performing a business function internally.
BPM and other definitions
• BPM includes concepts, methods, and techniques to support Business
processes including the following:
• design,
• administration,
• configuration,
• enactment, and
• Monitoring
What is a Business Process
• A business process consists of a set of activities that are performed
in coordination in an organizational and technical environment.
• These activities jointly realize a business goal.
• Each business process is enacted by a single organization, but it may interact
with business processes performed by other organizations.
Example of a
BP
Holistic overview of BPM
Core focus of
BPM Course
BPMN pizza example
BP modelling
BP Modeling: the practice of creating visual representations of an organization's workflows to analyze, improve, and
BPM System
• A BPM system is a generic software that is driven by explicit process
representations to coordinate the enactment of business processes.
E.g. BPMN pizza example
• The following is another example of a representation of an order
business process. Also known as a Business Process model (BP model)
BP models or blueprints
• The ordering process shown can be used as a blueprint that allows
the reseller company to organize its work.
• The company will receive many orders, each of which can be
processed as described in the blueprint.
• Can we try and write down the steps represented in the
model/blueprint on previous slide?
Process start Decision point
indicated start of Message
simultaneous activities flow
Activity Process end Data flow
Another BP Model Example
Next topic:
• The enterprise view on BPM.
