UNNExT Workshop on Implementation of e-SPS and Automation … BPA of SPS... · 2016-11-08 · the...

UNNExT Workshop on Implementation of

e-SPS and Automation for Agriculture

Trade Facilitation

1-3 November 2016

Bangkok, Thailand

Somnuk Keretho, PhD UNNExT Expert Kasetsart University [email protected]

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Business Process Analysis (BPA)

Introduce the technique of Business Process Analysis (BPA) for analyzing and optimizing trade facilitation procedures, especially SPS import/export certification procedures

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BPA guide and online course

are available at

unnext.unescap.org

http://www.unescap.org/our-work/trade-investment-innovation/trade-facilitation/bpa-course

1. BPA for Analyzing and Proposing Trade Facilitation Improvement

2. Introduction into Unified Modeling Language (UML) i.e. two types of diagrams: Use-Case Diagrams & Activity Diagrams

3. Three Phases of a BPA Project

4. Case Studies

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A Business Process is a collection of related and structured activities or tasks that produce a specific service or product.

Example Procedures of issuing Phytosanitary Certificates

in Bangladesh

Export procedures of garments from Dhaka, through port operations & customs clearance at Chittagong Port

Import Customs clearance procedures at the border check point of Phuentsholing, Bhutan

Import procedures and documentation of Lentils from Nepal, through Kakarvitta-Panitanki-Fulbari-Banglabandha borders, until the cargo arriving at Dhaka, Bangladesh.

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A modeling and analysis of business processes for capturing “as-is” (current) conditions and proposing better “to-be” (target) business processes

For example, it may include... Documenting existing regulatory procedures in an agency

Describing a “standard procedure,” e.g. a common case

Identifying related quantitative indicators, e.g. number of steps

Collecting information about time and cost at different steps

Providing a specification for simplification or automation of the process (to be implemented in the future)

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BPA can be used to analyse for

The whole supply chain of trade facilitation, or

A subset of these supply chain procedures

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Buy-Ship-Pay Model

21. Master Sea Cargo Manifest(17)

22. House Sea Cargo Manifest (37)

23. Export Declaration (114)

24. Goods Transition Control List (27)

25. Application for Permission to Export Rice (KP. 2) (24)

26. Sales Report (KP 3) (21)

27. Application for the Collection of the Permit for the Export of Rice (A. 3) (35)

28. Permit for the Export of Rice (A. 4) (35)

29. Application for Certificate of Standards of Product (MS. 13/1) (44)

30. Certificate of Analysis (17)

31. Certificate of Product Standards (MS. 24/1) (45)

32. Certificate of Fumigation (21)

33. Application for Phytosanitary Certificate (PQ. 9) (29)

34. Phytosanitary Certificate (33)

35. Application for Certificate of Origin (42)

36. Certificate of Origin (38)

1. Proforma Invoice (35)

2. Purchase Order (39)

3. Commercial Invoice (51)

4. Application for Letter of Credit (24)

5. Letter of Credit (32)

6. Packing List (25)

7. Cargo Insurance Application Form (20)

8. Cover Note (23)

9. Insurance Policy (24)

10.Booking Request Form – Border Crossing (25)

11.Booking Confirmation – Border Crossing (30)

12.Booking Request Form – Inland Transport (16)

13.Booking Confirmation – Inland Transport (18)

14.Bill of Lading (42)

15.Empty Container Movement Request (TKT 305) (20)

16.Request for Port Entry (TKT 308.2) (27)

17.Equipment Interchange Report (EIR) (24)

18.Container Loading List (28)

19.Container List Message (32)

20.Outward Container List (34)

* Number in parenthesis is the no. of data elements

36 Documents involving 15 parties, and 1,140 data elements to be filled in

Regulatory Docs

Transport Docs

Commercial/ Financial Docs

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16 days are required for Thai Rice export process

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Ref: BPA Guide to Simplify Trade Procedures,” UNESCAP/UNECE, 2012

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Business Process Analysis is a practical study to understand attributes of business processes,

and their relationships

Who involved

Procedures and Documents

required

Related Rules and Regulations

Some quantitative

indicators

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Procedures and documents handling remain largely paper dependent.

Missing and incorrect documentation slows progress through the supply chain

Keeping documents & freight in sync is complex and costly

Multiple parties capturing the same data is inefficient and error prone

We acknowledge other factors that makes trade in developing countries more difficult, including infrastructure, lack of adequate laboratory facilities, corruption, land-locked, … (but these are not the main scope of discussion in this workshop)

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BPA is the first technical step in preparing for trade facilitation measures including process simplification and automation.

It provides Inventory of processes, documents, data, parties, rules &

regulations Description of the processes Specifications for harmonizing data and development of

electronic documents Specifications to develop software for the automation of

procedures Business Models for the operation of Single Window

environment A basis for maintenance and improvement

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Several UN Recommendations for Trade Facilitation Improvement

Establishment of Single Window and

Paperless Trading Environment

Document Simplification and

Data Harmonization

Business Process

Simplification

Business Process Analysis (BPA)

UN/CEFACT Recommendation No. 33

•Manual for the Design of Aligned Trade Forms

•UN Trade Document Toolkit

•Draft APEC Handbook for Data

Harmonization and Core-Component

Based Electronic Message Development

•UN/CEFACT Core-Component Library

UN/CEFACT Recommendation No. 18

Business Process Analysis Guide

to Simplify Trade Procedures

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2. Introduction into Unified Modeling Language (UML) i.e. two types of diagrams Use-Case Diagrams & Activity Diagrams


4. Case Studies

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Business Process Modeling

What A technique for documenting a business process and its attributes

Activities that come in a specific order and decision points

Actors who perform those activities

Defined inputs and outputs of each activity

Criteria for entering and exiting the business process

Relationships among actors

Information flow

Associated rules and regulations

Quantitative indicators such as number of steps as well as time and cost required to complete a particular business process

Why To establish a common understanding about a business process that

is shared by all relevant parties

To communicate better all aspects of a business process

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A set of standard graphical notations for documenting a business process and business requirements

http://en.wikipedia.org/wiki/Unified_Modeling_Language

Is widely recognized and used among practitioners in business community as well as those in IT and software industry

Allows business domain experts to communicate procedural and documentary requirements with IT implementation or software development team

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http://en.wikipedia.org/wiki/Unified_Modeling_Language

Use Case Diagram (What)

A frame of reference illustrating a high level business process and its associated actors

Activity Diagram (How)

A detailed elaboration of a use case diagram

A graphical representation of a business process and its attributes Activities that come in a specific order and

decision points

Actors who perform those activities

Defined inputs and outputs of each activity

Criteria for entering and exiting the business process

Relationships among actors

Information flow

Buy - Conclude

sales contract and trade terms

Exporter or Representative

Importer

Quote price and term of trade

Confirm the intent to purchase

Proforma Invoice

Purchase Order

Not acceptable

Acceptable

Cancel

Prepare the shipment of goods


Importer

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Notation Description

Actor

Represents a role in a particular business process

Is labeled with a role name

Use Case

Represents a business process

Is labeled with a descriptive verb phrase

Relationship Association

Link actors with business processes that they participate in

Subject Boundary

Represents a process area

Includes the name of a subject boundary on top

Boundary

Actor/Role

Use case

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2) Ship

1) Buy

3) Pay

2.4) Apply for cargo insurance

2.2) Arrange transport

2.3) Prepare export

permit

2.5) Prepare and

submit customs declaration

2.1) Have

product sampled and examined

2.7) Clear goods through customs

2.8) Handle

Container and stow it on vessel

2.9) Prepare

documents required

by importers

2.6) Stuff container

and transfer to port of departure


Importer

Exporter’s Bank

Importer’s Bank

Customs

Department of Foreign Trade

The Central Islamic Committee Office Thailand

Port Authority

Department of Consular Affairs

Insurance Company

Carrier (Shipping Line)

Inland Haulage

Department of Fisheries

Authorized Private Inspector

Customs’ Bank

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Thailand Export Process

of Frozen Shrimp


Initial State

Represents the beginning of a set of activities

Final Activity State

Indicates the completion of the business process

Final Flow State

Indicates that further activities cannot be pursued

Transition Line

Indicates a sequential flow of actions and information

in an activity diagram

Fork (Splitting of Control)

Visualizes a set of parallel or concurrent flow of

actions

Join (Synchronization of Control)

Indicates the end of parallel or concurrent flow of

activities

Object

Represents a document or information that flows from

one activity to another activity (labeled with the name of

a document)


Swimlane

Is used to break up individual actions

to individuals/ agencies that are

responsible for executing their actions

Is labeled with the name of the

responsible individual or agency

Activity

Represents a non-decomposable

piece of behavior

Is labeled with a name that 1) begins

with a verb and ends with a noun; and 2)

is short yet contain enough information

for readers to comprehend

Decision

Represents the point where a

decision has to be made given specific

conditions

Attached with labels addressing the

condition on each transition line that

comes out of an activities and connects

to a decision point or vice versa

Process Participant 1

Process Participant 2

Process Participant n

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Exporter (or Representative) Department of Fisheries (DoF)

Authorized Private Inspector 2.1) Have

product sampled and examined


Department of Fisheries (DoF)


Collect sample

Examine

sample

Record the result

of examination

Test Report

Deliver sample

Collect

Test Report

Additional

examination required

Additional examination

not required Schedule the sampling date

Record result

of examination

Examine

sample

Collect

Test Report Test Report

Have product ready for sampling

Notify the date for sample collection

Submit Request for Sampling

Record sampling

result

Request for

Sampling

Collect

sample

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4. Case Studies

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A BPA Project in Three Phases

I. Scope setting/Planning – Specify a scope of processes to be analyzed

e.g. Phytosanitary Certificate issuance (export) procedures, or Phytosanitary Certificate import procedures at a particular sea port.

II. Data collection and process documentation – Define and document a sequence of steps in actual practices and their attributes

Who involved (stakeholders/actors)

Procedures and documents required (input to/output from)

Related rules and regulation

III. Process analysis – Locate bottlenecks, examine what causes them, and develop measurable and quantitative process indicators (e.g. the number of steps, time and costs required to fulfill those processes)

Recommendation development – Determine how to eliminate each bottleneck and prioritize improvement actions

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Project Sponsor

Project Manager/ Project Leader

Process Analysts

Process Participants/ Business Domain Experts

1) Define a project scope

2) Develop a

detailed plan and secure resources

3) Acquire

background information

4) Conduct

interviews and document captured data

5) Analyze the “as-is”

process and identify

bottlenecks

6) Develop and

propose

recommendations

Phase I

Phase II

Phase III

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Step Deliverable

Step 1: Define project

scope

Use case diagram illustrating business domain, process areas, process participants, and key

business processes

Step 2: Develop a detailed

plan and secure resources

Detailed project plan including an estimation of human resources required, schedules, and

software supported tools

A list of potential interviewees and their contact information

Step 3: Acquire background

information

A folder of background information about the business processes under the investigation

A list of guiding questions for the interview

Step4: Conduct interview

and document captured

data

A set of activity diagrams illustrating activities that come in a specific order and decision points,

actors who perform those activities, defined inputs and outputs of each activity, criteria for entering

and exiting the business process, relationships among actors, and information flow

A set of business process descriptions that describes activity diagram and lists all related rules

and regulations

Activity diagram illustrating integrated processes in the business domain

Time-Procedure chart displaying time required to complete each business process

Step 5: Analyze the “as-is”

processes and identify

bottlenecks

A set of observations of the as-is business processes that have the potential for improvement

Step 6: Develop and

propose recommendations

Final report with recommendations which may include diagrams of “to-be” business processes

Ph

ase

I P

has

e II

Ph

ase

III

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Identify any bottlenecks, redundancies, and non-value-added activities in procedural and documentary requirements

Make those procedures & documentary requirements transparent and easy for stakeholders to access to

Merge some procedures, and/or documents(forms)

Eliminate redundant procedures and unnecessary documentary requirements

Automate procedures and promote the sharing of trade and transport data among relevant stakeholders

Modify related laws and regulations to facilitate the operation of the newly designed business processes

Reform the regulatory-related organizational structures

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Example:


Office of Commodity Standards

Customs Exporter or Representative

Prepare documents

for submitting to Customs at port of exit

Permit for the Export

of Rice (A.4) with actual

quantity exported

Certificate of Standards

of Products (MS. 24) with

actual quantity exported

Record the actual

quantity exported and released date

Acknowledge

the provided information

Prepare documents

to declare the actual amount exported



quantity exported




Evidence of Sales

(Purchase Order or

Sales Contract)

Acknowledge


Example of redundant

procedural and

documentary

requirements Acknowledge



Verify the

accuracy/authenticity of exported cargo


Customs


Thailand’s Export Process of Jasmine Rice

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Customs Exporter or Representative

Prepare documents

for submitting to Customs at port of exit

Record the actual

quantity exported and released date

Acknowledge




quantity exported




Evidence of Sales

(Purchase Order or

Sales Contract)

Acknowledge




Verify the

accuracy/authenticity of exported cargo


Customs


Example:

Thailand’s Export Process of Jasmine Rice




4. Case Studies

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Case Exercise 1 Describe the meaning of

the following Use Case Diagram and Activity Diagrams

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1) Buy

3) Pay


Importer

Exporter’s Bank

Importer’s Bank

Customs

Thai Chamber of Commerce

Port Authority

Insurance Company

Carrier (Shipping Line)

Inland Haulage



Department of Agriculture

Board of Trade of Thailand

Department of Consular Affairs

Department of Disease Control


2) Ship

2.1) Obtain Export Permit

2.4) Obtain cargo insurance

2.2) Arrange transport

2.7) Transfer to port of departure

2.8) Clear goods through

customs

2.5) Provide customs

declaration

2.9) Handle cargo and stow

on vessel

2.10) Prepare documents required

by importer

2.6) Stuff a container or

a lighter

2.3) Arrange the inspection and

fumigation

2.11) Verify the accuracy/authenticity

of exported cargo

A Use Case Diagram:

Showing main procedures

for exporting Rice

from Thailand

(through a sea port)

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Prepare documents for the application

of export permit

Verify submitted information

Sign and authenticate A. 4

Correct

Incorrect

Collect A. 4 Permit for the Export

of Rice (A. 4)

2.1) Obtain export permit

Application for Permission to Export Rice (KP. 2)

Evidence of Sales (Purchase Order or

Sales Contract)

Draft Permit for the Export of Rice (A. 4)

Sales Report (KP 3)

Application for the Collection of the Permit

for the Export of Rice (A. 3)

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An Activity Diagram:

Showing detailed procedures and document requirements

for obtaining a Rice Export Permit

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Case Exercise 2

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Analyzing As-Is PC Issuance Processes & Identifying any Bottlenecks/Improvement Opportunities

1. Exporter or authorized representative submits an PQ.7 application form (along with Import Permits (if any)) requesting for approval and PQ.7 number from NPPO, Department of Agriculture

2. If the application and attached documents are satisfied by NPPO, NPPO informs the Exporter for transport fee payment.

3. Exporter pays for the fee the NPPO accountant, the NPPO is informed of the payment, then the issues the PQ.7 with the unique ID number.

4. Exporter receives the approved PQ.7., and informs the surveyor for fumigation.

5. Exporter, surveyor and NPPO agree on the fumigation schedule – then Surveyor conducts the fumigation.

6. NPPO officer inspects the fumigation, and provides the inspection report.

7. Exporter submits the PC application form to NPPO.

8. If the inspection report is satisfied, NPPO issues a draft PC for the Exporter to verify.

9. If Exporter is ok with the draft PC, informs NPPO.

10. Exporter pays for other fees, then NPPO issues the signed PC to Exporter.

11. Exporter sends the PC to the Importer to be shown to the import country’s NPPO.

A Case Example

* This is a case of Department of Agriculture, MOAC, Thailand.

- Manual operations

- Paper-based

transactions

- Costly and take

several days for

3-4 physical visits

to complete the

transactions

- Difficulty in data

cross checking &

validation

(possible paper

fraud and error

prone)

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- Electronic

transactions

instead of

manual

- Electronic

documents

instead of paper

documents

- Faster/less cost:

2-3 physical visits

were reduced to

1 physical visit,

or none for all

transactions

- Better compliance

with data cross

checking

A Case Example

1. Exporter or authorized representative submits an PQ.7 application form online (along with scanned Import Permits (if any)).

2. The application and attached documents are validated online, if ok – the Exporter is informed for transport fee payment.

3. Exporter pays for the fee online (through online e-Banking or other payment instruction).

4. The ePhyto System approves the PQ7 online and inform the Exporter, the designated Surveyor and NPPO officer for fumigation schedule.

5. Surveyor conducts the fumigation.

6. NPPO officer inspects the fumigation, and provides the inspection report online.

7. Exporter submits the online PC application form to NPPO.

8. If the inspection report is satisfied, NPPO issues a draft PC for the Exporter to verify online.

9. If Exporter is ok with the draft PC online, the system will generate the fee amount.

10. Exporter pays for other fees online, then NPPO issues the signed PC to Exporter on the system

11. The ePhyto Certificate could be printed out or sent electronically to the import country’s NPPO.

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Submit P.Q.7 Application

Schedule for Fumigation

and Inspection

Request for Phytosanitary

Certificate

Exporter

NPPO Department of Agriculture

Surveyor

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Exporter NPPO, Department of Agriculture

Submit an P.Q.7 application

An P.Q.7 Application

Form

Import Permit (If any)

Verify and Validate Documents

If the documents are not satisfied.

Calculate the processing fee

If the documents are satisfied.

Pay the processing fee

Receive Payment and Issues the P.Q.7 No.

No. of P.Q.7 Acknowledge

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Exporter Surveyor NPPO, Department of Agriculture

Send the P.Q.7 No. and Schedule for fumigation

and inspection

Acknowledge the fumigation and

inspection

Make a schedule

Acknowledge Inform results of Inspection

Acknowledge

Agree on the fumigation and inspection schedule

Conduct fumigation and facilitate inspection by

NPPO

Record the result of Inspection

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Submit the approved P.Q.7 (with No.)

Application for Phytosanitary Certificate (P.Q.7) with No.

Bill of Lading

Verify and Validate Documents

If documents are not satisfied.

Print the Draft of Phytosanitary Certificate

If documents are satisfied (also check

the inspection report).

Verify the Draft of Phytosanitary Certificate

Send to the authorized signatory

Phytosanitary Certificate

Request for correction

Correct

Incorrect Generate processing and

certificate fee

Make a payment and receive the Certificate

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Submit the PC Application online

Online Application for Phytosanitary

Certificate

Scanned Bill of Lading

Validate documents and approve

Generate the processing fee

If documents are satisfied.

Pay processing fee online

Receive Payment

Receive paper Phytosanitary

Certificate

Electronic Phyto System

Receive and validate the

online application

If documents not satisfied

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Issue PC online and send the Electronic PC to the import country’s NPPO.

Inform that the

documents are not

satisfied.

1. BPA is a simple but powerful methodology to capture/monitor the “as-is” conditions, and to propose “to-be” processes and documentation requirements for trade and transport facilitation improvement.

2. UML Diagrams: Use Case Diagrams & Activity Diagrams, and also Time-Procedures Chart are introduced.

3. Three Phases of a BPA Project is recommended. 1. scoping/planning, 2. capturing/modelling the as-is, and 3. analyzing/proposing recommendations for improvement

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Somnuk Keretho, PhD UNNExT Expert

Kasetsart University

[email protected]

Questions & Answer

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