BPM

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 BPM

A business process is an activity or set of activities that helps accomplish

an organization's goals, such as increasing profits or promoting workforce
diversity.
Business process management (BPM) is a structured approach to
improving the processes organizations use to get work done, serve their
customers and generate business value.

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BPM
BPM uses various methods to improve a business process by
analyzing it, modeling how it works in different scenarios,
implementing changes, monitoring the new process and
continuously improving its ability to drive desired business
outcomes and results.

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BPM
BPM is a broad discipline and, by definition, a dynamic one given how
the organizational roles, rules, tactics, business goals and other
elements it encompasses are constantly changing.
Over the years, BPM has accommodated a variety of optimization
methodologies, from Six Sigma and lean management to Agile.

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 BPM
As business processes at some companies became
too large and complex to be managed without the
aid of automated tools, BPM software products were
developed to support large-scale business change.
Enabling BPM technologies have in turn evolved,
driven by advances in AI, machine learning and
other so-called intelligent technologies that are
providing new ways to discover, design, measure,
improve and automate workflows.

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 Why is business process management
important?

Business process management is important

because effective business processes are crucial to
enterprise success. Common types of business
processes that help companies drive business
goals include the following:
•Developing and making a new product.
•Fulfilling a product order.
•Managing customer service.
•Assimilating a new employee.
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 Why is business process management
important?

A well-designed business process breaks these tasks into structured,

repeatable steps that workers can follow to produce consistent results.
The repeatable steps help organizations predict the resources they need,
lowering the risk of under- or over-allocating resources. Measuring the
steps reveals weak links and bottlenecks, pointing the way to
potential business process improvements.

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Business process management
benefits
•Increased efficiency and cost savings: BPM systems help
to optimize existing processes and to incorporate more
structure into the development of new processes. It does this
by removing process redundancies and bottlenecks, resulting
in improved efficiency and productivity. With more agility,
businesses can achieve their intended business outcomes at a
faster rate, and they can allocate any excessive resources to
other high priority work.

•Enhanced employee and customer experience: A BPM

suite of tools assists in eliminating repetitive work and in
making information more accessible. By removing distractions,
employees are able to focus on their work and their
customers, leading to increases in customer satisfaction. Clear
workflows also shorten the learning curve within the employee
onboarding process, enhancing productivity and engagement.9
Business process
management benefits
More scalable processes: Since BPM enables better
process execution and workflow automation, this transfers
well when scaling processes to other geographies across the
world. Business process management tools can bring clarity
to roles, ensuring consistency along the process, and it can
also surface opportunities to incorporate business rules for
automation, allowing teams to focus more on innovation.

Greater transparency: Since business process automation

clearly defines owners for tasks along the process, this
provides more transparency and accountability throughout a
given process. This fosters more communication among
teams.

Less dependency on development teams: BPM offers low-

code features which remove potential dependencies on
development. Business users can be onboarded onto these
tools quickly and easily, increasing process automation across
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1.Design. Analyze the existing process to see what can be improved. Then, develop
the business process as it should ideally exist using standardization and automation.
2.Model. Look at how the redesigned business process operates in different scenarios.
3.Implement. Execute improvements, including standardization and process
automation.
4.Monitor. Track improvements to see how they perform.
5.Optimize. Continue to improve the business process on an ongoing basis.
6.BPR

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Process design: The team should start by outlining the milestones
within the process. From there, individual tasks within the overall BPM
process should be identified along with task owners for each step in the
workflow. The steps should be clearly defined so that the team can
identify the areas for process optimization and the subsequent metrics
to track its improvement.

Model: During this step, the team should create a visual

representation of the process model. This should include specific
details, such as timelines, task descriptions, and any flow of data in the
process. Utilizing business process management software is helpful
during this stage.

Execute: The team should conduct a proof of concept, testing the new
BPM system with a limited group. After incorporating any feedback, the
team can begin to roll out the process to a broader audience.
Monitor: During this phase, the team should monitor the process,
measuring improvements in efficiency and identifying any additional
bottlenecks.

Optimize: At the final step, the team make any final adjustments to
the process to improve business activity.
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Best Practices

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 Business process management use
cases
Content distribution: Media firms can use BPM to automate
the process of content preparation and delivery, from content
creation to distribution. A business process management system
can be designed to interact with content management, rights
management, content traffic and work order systems.

Customer service: Customer service representatives can

identify frequently asked questions for chatbots to handle,
alleviating the team when there is a high volume of service
requests. Transcript data from call centers and chatbots can also
help automate processes further as well as inform more
personalized answers for customers.

Finance: Companies can create templates to standardize

purchase orders submissions from various teams, allowing them
to procure business software or hardware more quickly. In
addition, customize workflows can be established for unique
scenarios.

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 Business process management use
cases
•Human resources: HR can employ BPM to streamline
document and workflow management. It provides a more
structured environment for processing HR forms, such as
employee onboarding and off-boarding, performance
evaluations, vacation requests and timesheet approval.

Banking: When processing individuals or businesses for loans,

banks need to evaluate applicants for potential credit risk. This
involves collecting information from multiple sources, such as
the applicants, employers, and credit rating agencies. BPM
expedites decisions around loan eligibility by managing the flow
of information throughout the process and reducing errors in
documentation.

•Order fulfillment: Firms can improve the operational

efficiency of their order fulfillment systems using BPM. They can
use BPM to manage special offers, order capture, and order
fulfillment. This shifts the process toward customer-centric
order management that delivers greater business value. 16
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Process Management
Principles of managing, controlling and improving processes
◦ Workflow oriented  how jobs flow through an organization

Important elements in managing processes

◦ Process design
◦ Continuous (incremental) improvement
◦ Control systems
◦ People management
◦ Change management

Origins in the field of quality management

◦ Process control is a fundamental component

Historically strong manufacturing focus

◦ Equally valuable in services

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The Power of Adopting a
Process View
Weaknesses of the functional org. and division of labor
paradigm
◦ Focus on skills and resource utilization rather than work output
◦ Reward systems tailored for the functional unit not the overall firm
◦ Group behavior and cultures fostering an “us versus them” mentality
◦ Decentralization  “firms within the firm” with their own agenda

Strengths of a process view

◦ Creates focus on work output  reduced risk for sub-optimization
◦ Leads to transparency of how contributions of individual workers fit into
the “big picture”  encourages involvement and empowerment
◦ Helps break down barriers between departments
◦ Creates a sense of loyalty towards the process to balance the loyalties
within the functional units

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Principles for Successful
Process Management

Phase I: Initialization Phase II: Definition Phase III: Control

Assign Analyze Define the Establish Develop & Perform

process boundaries process control implement feedback
ownership & interfaces points measures & control

 Process authority,  Workflow  Means and procedures for process

scope, interfaces documentation monitoring, feedback and control
and handoffs are  Baseline for are established
determined process
evaluation
is defined

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Phase I: Initialization
 Objective:
Clarify the process scope
Determine who will take responsibility for the process

Process ownership
Need someone in charge to make things happen
Responsibilities of a process owner
◦ Accountability and authority for process operations and improvements
◦ Facilitate problem solving and make sure corrective action is taken
◦ Mediate between line managers with overlapping authorities

Guidelines for assigning process ownership

◦ Manager with most resources or most work invested in the process
◦ Manager that is most affected if the process fails
◦ Process owner must have high enough position to see how the process fits
into the “big picture”, needs clout to solve functional bickering
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Phase I: Initialization
Analyzing Process Boundaries and Interfaces
Process Boundary defines the process entry and exit points
where inputs flow in and outputs flow out
◦ Provides a clear picture of the process scope
◦ Defines the external interfaces

Internal interfaces
◦ Hand-off points within the process boundaries
◦ Most critical where the process crosses functional or organizational
borders

Most process inefficiencies are related to insufficient

interface communication (= lack of coordination)
◦ Important to identify critical interfaces early on

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The Customer-Producer-Supplier
(CPS) model
Useful approach for resolving interface related problems
Applying the CPS model to all critical interfaces  adopt a view of
the process as a chain of customers
◦ Coordination achieved by understanding internal & external customers
◦ Involves negotiation and agreement between all parts

Producer Requirements
Output Interface

Producer
Supplier Input Output Customer
PROCESS

Input Interface
Customer Requirements

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Phase II: Definition
 Objective:
 Understand and document the process workflow
 Facilitate communication and understanding of process operations

Define the process

Documentation of work content in individual activities
◦ Usually in terms of verbal descriptions
 Operating procedures or Standard Operating Procedures (SOP)

Documentation of process flows

◦ Usually a flowchart based method
 Combination of verbal and graphical description

Common information gathering techniques

◦ Interviews with people working in the process (group or individual)
◦ Analytical observation
◦ Review of relevant documentation
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Phase III: Control (I)
 Objective:
 Establish a system for controlling the process and providing feedback to the
people involved

Establish Control Points

Control points are activities such as
◦ Inspection, verification, auditing, measuring, counting…
◦ Usually considered business value adding

Without control points and a control system the only way of

assessing process performance is customer feedback
Þ The process ends up in a reactive mode
Þ Poor quality is discovered too late

Location of control points is determined by

◦ Criticality – impact on customer satisfaction
◦ Feasibility – physically and economically possible
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Phase III: Control (II)
Develop and Implement Measurements
Involves answering the questions
1. What is to be measured and controlled (Ex. FedEx)?
2. What is currently measured (available data)?
3. Can a business case be made for a new measurement system?
4. What is the appropriate sampling method, sampling size and frequency?

Measurements should be meaningful, accurate and timely

◦ Statistical and graphical tools needed to turn data into information.

Five measurement categories: Measures of…

◦ Conformance (to given specifications)
◦ Response time (lead-time, cycle time)
◦ Service levels (degree of availability)
◦ Repetition (frequency of recurring events such as rework)
◦ Cost (Quality, internal and external failure costs)
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Phase III: Control (III)
Performing Feedback and Control
Of critical importance for stabilizing and improving the process
Objectives of control/corrective action are
◦ Regulation to maintain a certain performance level
◦ Improvement aiming at reducing variability or raising the average
performance level

Feedback is an important enabler for corrective action

◦ People in the process need to understand how their actions affect the
overall process and its performance
◦ Feedback should be performed in a constructive – not punitive – manner

Constructive feedback
◦ Makes people feel that they matter
◦ Encourages involvement and commitment

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 Different categories of business process
management
1.System-centric. This type of BPM focuses on processes involving
workflows in business systems that operate without much human
intervention and are integrated into enterprise applications. Automated
processes in customer relationship management and enterprise resource
planning systems are two examples.
2.Human-centric. BPM can also focus on process flows that people
handle. These processes include ones in business applications that have
features designed for human interaction, such as a well-designed user
interface, alerts and notifications.
3.Document-centric. This approach centers on documents, such as the
process of formatting, signing and verifying contracts. Often, business
process management tools specialize in a specific document-centric
task, such as signing documents.

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 Different types of BPM technologies
•Process mining tools for the discovery, representation
and analysis of the tasks that drive business processes.
•BPMN tools for diagramming business processes.
•Workflow engines to automate the flow of tasks that
complete a business process and support workflow
management.
•Business rules engines (BREs) to enable end users to
change business rules without having to ask a
programmer for help.

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iBPMS. The term intelligent BPMS (iBPMS) was introduced by research
firm Gartner, Inc. It is now widely used by BPM vendors to underscore
how the use of advanced technologies -- such as real-time analytics,
machine learning, complex event processing, business activity monitoring
and other systems -- have made process automation more data-driven
and dynamic. These iBPMS products also come with advanced social
and collaboration capabilities.

LCNC. BPM's increasing use of low-code/no-code (LCNC) technology

means that businesses no longer need to depend solely on professional
coders to optimize their business processes. Business analysts and even
business users can work together with developers to model new
business processes.

RPA vs. BPM. Robotic process automation (RPA) and BPM, considered
by some to be competitors or at best frenemies, today function as
complementary partners

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 Tools for BPM
• Appian.
• Agile Point.
• Bizagi.
• iGrafx.
• Kissflow.
• Microsoft.
• Newgen.
• Nintex K2.
• Oracle.
• Pegasystems.
• Progress Software.
• Trisotech.

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