Business Process Management 2052

8/2/2019 Business Process Management 2052

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National Collegiate Conference

Institute for Certification of Computing ProfessionalsKewal Dhariwal 2008

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Business ProcessManagement (BPM)

How to get beyond ERP and

move into the 21st Century

Kewal Dhariwal, PhD, CCP, I.S.P.Manager, ICCP & Supply Chain Research

Athabasca University


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What is ICCP creating for a BPM Exam?

1.0. BPM Concepts and Roles

1.1 Definitions

1.2 Organizational Roles & Responsibilities

2.0. Business Management Perspective

2.1. Business Concepts, Principles and Guidelines

2.2. Performance Management2.3. Ongoing Monitoring and Controlling Execution

3.0. BPM Methodology Approaches and Techniques

3.1. Enterprise Process Planning

3.2. Process Analysis and Design

3.3. Process Management Improvement4.0. BPM Technology

4.1. BPMS Implementation

4.2. BPMS Technology Types


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Why BPM?

BPM is going to be the dominant management

discipline in the 21stCentury and is already theway that leading companies manage their

businesses as a management discipline. The convergence of BPM and the continually

increasing capabilities of BPM software enableorganizations to manage and execute change in

an increasingly hypercompetitive environmentto adapt, thrive and survive.

Brett Champlin, CCP, CDMP, President - ABPMP


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Why BPM?

Enterprises are seeking to transform themselves intocustomer-focused, process-centric organizations andconsider this transformation critical to their businesssuccess.

A key part of that transformation is to reorganizeinformation resources as substantially independentreusable services.

A service oriented architecture (SOA) embraces thisconcept of reusable services and represents the nextmajor step in the evolution of IT strategies.

Tom Dwyer, V.P. Research, Brainstorm Group Mike Rosen, Editor SOA Magazine, Brainstorm Group


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What is happening in BPM?Results from a survey of 1200 companies (2007)

Carilu Deitrich, BEA BPM Product Manager

Market consolidation and technicalconvergence

150 vendors providing small to large enterprise-

class vendors with powerful solutions andmodeling tools. Consolidation occurring to reducethat number to 25 for enterprise wide solutions.

Spanning multiple packages BPM increasingly being used to manage

processes that bridge multiple packagedapplications.


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What is happening in BPM?

People process problems Organizational challenges such as internal politics

and change management outweigh technicalchallenges in deploying BPM.

Continuous process improvement is the key tofostering BPM as an imperative business strategy

BPM, Collaboration with Competitors Companies are seeking ways to better support ad-

hoc, collaboration

BPM today does not support this well enough, butBPM companies are moving towards this direction.


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What is happening in BPM?

BPM adoption mostly departmental Some leading-edge companies are tackling

enterprise-wide processes (more the exception

than the rule). 1200 companies surveyed 18% currently

employing enterprise wide BPM

50% of surveyed group are focusing on

departmental process problems BPM rapid growth attributable to bringing business

strategists and technologists together to solveprocess problems

N i l C ll i C f


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What is BPM?Lets explore it in detail

BPM goals are to efficiently align theorganization with the customers wantsand needs

BPM attempts to continuously improveprocesses seeking process optimizationby

Defining Measuring

Improving your process

N i l C ll i C f


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What is BPM?

Executives need to organize and manage, not only the

cost chain, but also everything else including strategyand product planning as one economic whole,regardless of the legal boundaries of individualcompanies.

This is a shift from cost-led pricingto pricing-led costing. Peter Drucker Management Challenges of the 21st Century.

This change is from forecast-driven inventory style

systems to responsive, flexible and demand-driven masscustomization, globally.

N i l C ll i C f


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What is BPM?

People Customer facing staff are best suited to understand customer

needs and must be empowered to make improvements.

Many improvements can be done without involving

technology

BusinessTechnology Divide Business processes are managed by business people.

Information moves between software packages with requires

a service oriented architecture (SOA) often driven orgoverned by IT.

N ti l C ll i t C f


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What is BPM?

Modeling Modeling a business process is a business domain

Perfecting a business process is a staff domain.

Business modeling is Business ProcessManagement (BPM).

BusinessTechnology Connection

The size and complexity of tasks often requires theuse of technology to model efficiently.

Business people, especially customer facing staffmust control and do the modeling.

N ti l C ll i t C f


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What is BPM?

Bridging IT and Business Bringing the power of technology to business staff

and reducing their work should be the BPM groupcredo.

BPM is the bridge between Business and IT. BPM systems will develop to be industry specific.

A cyclical BPM life-cycle exists: Design

Modeling Execution

Monitoring

Optimization

N ti l C ll i t C f


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What is BPM?

Process Design Identify existing processes

Design the to-be processes

Key Terms Representations of process flow

Actors within a process

Alerts & Notifications

Escalations Standard Operating Procedures

Service Level Agreements

Task hand-over mechanisms

N ti l C ll i t C f


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What is BPM?

Process Design Techniques & notations

IDEF0 IDEF nn (U.S. Air Force- public domain) IDEF0 Function Modeling IDEF1 Information Modeling IDEF1X Data Modeling IDEF3 Process Description Capture

Event Driven Process Chains (originally inside SAP/R3), nowalso through IDS Scheer, MS Visio, other tools.

BPMN (simple diagrams with a small set of graphical elements) developed by BPM Institute handed over to ObjectManagement Group (OMG maintained).

Flow Objects Connecting Objects Swimlanes Artifacts



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What is Business ProcessModeling Notation (BPMN)?

BPMN simple diagram (www.wikipedia.org )

http://www.wikipedia.org/http://www.wikipedia.org/


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What is BPMN?

BPMN larger example (www.wikipedia.org )

http://www.wikipedia.org/http://www.wikipedia.org/


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What is BPM?

Modeling Starting with the Design (theoretical)

introduce variables such as cost of

materials, introduction of more people, etc. todetermine how the processes might operatedifferently.

What if analysis

What if only 90% of the people had to do the work? What if only 50% were available (baby-boomers

retiring)



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What is BPM?

Execution Off-the-shelf BPM tools are available:

http://bpm-directory.omg.org/vendor/list.htm

BEA, ID Scheer, Borland, etc. Enterprise-wide tools include all of the following

and more:

Graphical tools

Text language based modeling tools

Visual programming using metaphors

Business Rules definitions governing system behavior-leading to a business rule engine

http://bpm-directory.omg.org/vendor/list.htmhttp://bpm-directory.omg.org/vendor/list.htmhttp://bpm-directory.omg.org/vendor/list.htmhttp://bpm-directory.omg.org/vendor/list.htm


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What is BPM?

Monitoring Individual process tracking (state and statistics)

State of a customer order, state of a delivery, how manydelivered on-time, right-quantity, right-place, etc.

Identify problems and correct

Work with customersonce the problem is identified, fix theconnectivity issues (information rollups, data exchange, peoplecommunications, etc.)

Measures: Cycle time, defect rate, productivity

Business Activity Monitoring (BAM)

Realtime or Ad-hoc Process Mining

Compare event logs with a-priori model to analyzebottlenecks, breakdowns in process, etc.



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What is BPM?

Optimizing Identifying process failures, bottlenecks, under

performance issues

Cause-effect analysis Redesign or modification of process to

Reduce Cost

Improve Quality

Increase Responsiveness



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Where does SOA fit in?

Service Oriented Architecture (SOA) is a way ofexecuting BPM more efficienty and effectively

SOA provides the architecture to provision how

processes exchange data in a flexible manneracross business processes, both in the companyand between collaborating companies (supplychains)following the value chain more closely.

SOA unifies business processes by structuringlarge applications as an ad-hoc collection ofsmaller modules called services.



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Where does SOA fit in?

XML has been used extensively in SOA to create data which iswrapped in neat descriptive containers.

The services are described by Web Service Description Language(WSDL) and SOAP a protocol for exchanging XML based messagesover the internet using HTTP/HTTPS.

The goal of SOA is to allow programs or applications to be strungtogether to form new ad-hoc applications which are built almostentirely from existing software services.

WS-BEL Web Services Business Execution Language (serializedXML) processes in WS-BEL exclusively import and exportfunctionality by using web interfaces.

Software reuse is one goal without reconfiguring the existingapplication So this is systems integration in a totally differentmanner than the 1980s and 1990s ERP methods which oftenrequired the company to change its processes to fit in with the ERPenvironments.



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New Rules for the Process-Managed EnterpriseHoward Smith and Peter Fingar (BPM-the Third Wave) 2003

Item Old Rule Disruption New Rule

1 Process-based clerical work andpractice-based skilled work are

different

Process Desktop All forms of work can be described andmanaged by a single system

2 Processes are rigid scripts, focusedmainly on the inputs and outputs of

discrete steps

Process Calculus Processes are fluid, dynamic, amoebicand adaptable

3 Executing a process means locating it

in one place and under centralizedcontrol

Distributed process execution and

end-to-end processes

Processes can be as easily managed in a

federated environment as a centralizedone

4 Collaboration requires standardapproaches

Business process modeling

languagesFirms are free to innovate because

collaboration rests on a standard

representation for processes, not on

standard processes

5 Companies have to start over Process discovery, introspectionand projection combined with

application componentization

Companies build on and transform

what exists

6 Process must be kept simple in orderto be manageable

Process participants Processes can be as complex as theyneed to be, yet still be manageable

7 Processes have to be changed in orderto reduce the manual checking

required of accountants, auditors and

supervisors

Process metrics and process

lifecycleProcesses can monitor themselves



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ITEM OLD RULE DISRUPTION NEW RULE

8 A choice must be made betweenincremental process improvement, and

radical engineering

Lifetime process lifecycle

managementThere are no discontinuities

9 Incremental process improvementsproduce minor gains

Process analysis and

transformationProcesses evolve in fits and starts,

sometimes incrementally and

sometimes radically, but always non-

disruptively

10 Radical change is painful anddisruptive

Computer-aided process

engineeringReplacement of organizational change

with technological implementation

11 Companies need a large, dedicated,long-standing reengineering team

Process portal Process management vanishesbecoming a part of everybodys job

12 Process innovation is an art form, withuncertainties and ambiguities

Process calculus Process management is a precisescience

13 Radical change takes a long time toimplement

Process deployment and

executionNot all radical changes require radical

changes to IT systems or organization

14 No team can reengineer more than oneprocess at once

Process management system Continuous process improvementacross many processes



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15 Radical change is top-down andcontinuous changes is bottom-up

Integrated process model There is no distinctioncircumstancesgovern the approach you take. Process

models developed quite independently

can be easily combined.

16 Reengineering never happens from thebottom-up

Process intranet Insights for process streamlining andprocess re-design arise naturally in the

business, and are readily accepted by

those affected

17 Managers make all process designchanges

Collaborative process design and

closed loop process optimizationChange-making is part of everyones

job

18 There must be a single process owner Collaborative process analysis Everyone that needs to be involved inthe process improvement can be

involved

19 Processes can be designed only by theprocess team

Shared process repository As many designers as required can beinvolved, deep within the business

20 It takes work to have to find out whereyou are in a given process

Process metrics Processes measure themselves and tellyou where they are

21 Every process team needs a humancoach

Process training built into process

designsProcesses as coaches



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ITEM OLD RULE DISRUPTION NEW RULE

22 Plans get revised only periodically Process modeling language Plans are processes, guiding theenterprise in real time

23 The only feasible processes are thosesupported by the existing IT systems

Process virtual machine Any process can be modeled andexecuted; it may have nothing to do

with IT

24 As few people as possible should beinvolved in the execution of a process

End-to-end processes, process

data correlation, distributed

process execution

Everyone and every system can be

involved without degradation of

automation or efficiency throughmanual hand-offs

25 Dont bury reengineering in themiddle of the corporate agenda

Process modeling methodology Value analysis, process analysis, qualitymanagement and costing are combined

into one analysis

26 Tradition counts for nothing Process discovery Tradition is everything, and must bebuilt upon. Those who fail to learn

from the past are condemned to repeat

it27 Design processes so that only a small

number of variants are neededProcess customization and

process patternsAny process can be reused to construct

or constrain the design of hundreds,

even thousands of variants

28 A company has no more than ten totwenty processes of interest to process

engineers

Process discovery Organizations are more complex thanthey think



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29 The processes to be improved must becarefully selected and prioritized

Process optimization, analysis

and transformationProcess improvement is built into the

methodology; pain points emerge

naturally

30 Processes must be designed toeliminate excessive information

exchange and data redundancy

Process data Strong processes are those that includeall required participants who can freely

and efficiently exchange and re-process

all required information

31 Work must be structured so thatsuppliers and customers can plan and

schedule their respective activities

independently

Collaborative processes Coordination of independent activitiesis built into new processes

32 Divide overly complex processes intosmaller number of simpler processes

Enterprise process model Manage processes as intellectualproperty and derive what is required for

execution automatically

33 Technology only participates in theprocess (as cogs in an engine)

Third wave Technology implements the process(drives the pistons; orchestrates the

cogs)

34 Processes change only when peoplechange them

Capability passing, external

process participants, business

rules

Processes can change themselves

within limits set by process design



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35 Processes take a long time todesign

Real-time process

manufacturing; the real-

time enterprise

Just-in-time, single-purpose,

throw-away processes are all

possible and useful and

reflect the way business is

really doneexperimentally

and systematically

36 Changing processes acrossorganizational boundaries is

virtually impossible

Process interface

definition language and

end-to-end processes

Process management knows

no organizational boundaries

37 There is a divide betweenbusiness and IT

Third wave BPM Process owners design anddeploy their own processes,

obliterating, not bridging, the

business IT divide



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Institute for Certification of Computing Professionals 29

Future for BPM?

Move from mechanistic systems to morecomplex environments where HumanIntuitionand Judgmentare allowed for in

the work flow. Better capture and adhere to business

rules Business Rules driven systems.

Intelligent software agents will be used toreplicate business rules behavior andmodel optimizing responses.

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