This reference book is the copyrighted property of the ... · iv ABPMP President’s Note BPM is a rapidly growing discipline that is changing the way businesses look at managing

© ABPMP2013ThisreferencebookisthecopyrightedpropertyoftheAssociationofBusinessProcessManagementProfessionals.ISBN‐13:978‐1490516592ISBN‐10:149051659X

i

Foreword by Connie Moore, Vice President and Principal Analyst, Forrester Research

I’msohonoredthatABPMPaskedmetowritetheforewordtothethirdversionoftheABPMPCommonBodyofKnowledge.Why?BecausethecertificationworkthatABPMPhasembarkedonisoneofthemostimportantinitiativesinthebusinessprocessmanagement(BPM)sphere.AtForresterResearch,weknowtherearenotnearlyenoughtrainedprocessprofessionalstomeetthegrowingdemandforskilledBPM‐knowledgeableandexperiencedemployees,andthelackofskilledpractitionerswillholdbacktheadoptionofBPMforprocessimprovementandtransformation.

WhileNorthAmericanandEuropeaneconomiescontinuetoexperienceunrelentingjobcutbacks,chronicunemploymentandunderemployment,andstagnantsalaries,theBPMskillsshortageisagreatnews(notjustagoodnews)storyforpeoplelookingforworkorwantingtoadvancetheircareers,whetherinbusinessorIT.ButtheissuegoesbeyondindividualsgettingtrainedinBPMfortheirownadvancement:companiesnotonlyseektofillpositionsnowbutalsowillscaletheirtrainingprogramsoverthenextdecadetostaffanacceleratingBPMtransformationprogram.ThismeansthatbusinessesandgovernmentagenciesmuststepuptotheinternalchallengeofadequatelytrainingalargenumberofknowledgeableBPMpractitioners,andalsothatmoreprofessionalorganizationsmustprovideaplaceandwayforpeopletocraftandhonetheirskills.

Butthat’snotall.Recently,ForresteridentifiedtheneedfororganizationstomovetheirBPMfocustoBigProcesstosupportprocess‐drivenbusinessesofthefuture.WedefinedBigProcessasfollows:

Whensenior‐mostbusinessandtechnologyleadersembracebusinessprocesschangebyshiftingtheorganization’sfocusfromisolatedBPMandprocessimprovementprojectstoasustainable,enterprise‐widebusinessprocesstransformationprogramsupportedbytopexecutives.

Further,wesaidthereareFiveTenetsofBigProcessthinking:

Tenet1:TransformProcesses,Don’tJustImprove

Tenet2:GiveTheCustomerControl

Tenet3:Globalize,Standardize,AndHumanizeProcesses

Tenet4:EmbraceBigData

Tenet5:DoubleDownOnProcessSkills

Thesetenetsmeanthatorganizationswilldoubledownonhiring,buildingandgrowingBPMskills,andalsothatexperiencedBPMpractitionerswillexpandtheirknowledgetoincludenewdisciplines,suchashowcustomerexperienceandbig

ii

datafitintobusinessprocesses.That’swhereABPMPandtheCommonBodyofKnowledgecomein.Theyfillavitalrole.

It’ssoironicthat—havingdecidedtoworkonthisforewordtoday—whenIopenedmye‐mailinboxthismorning,theveryfirstmessageIreceived(fromtheUK)said:

“ReadyourarticleonBPMandaminterestedindevelopingBPMskill‐sets.HowbestcanIgoaboutacquiringthenecessaryskillset?”

Andmyresponsewas:

“IrecommendthatyoucheckoutthecertificationprogramfromABPMP,theAssociationofBusinessProcessProfessionals.TheyhaveaCommonBodyofKnowledgethatyoucandownloadfromtheirwebsiteorbuyinbookform,andthentakethecertificationtest.Ithinkthatisaverygoodfirststep.”

WhatagreatvalidationthatpeopleallovertheworldreallyneedandevencravethematerialinthisBPMCommonBodyofKnowledge.

Here’showIpersonallyknowthatBPMskillsareinhighdemand:

Processislandswithinorganizations.Inmyworkwithlargecompaniesandgovernmentagencies,Irunintomanygroupswithinorganizationsthathavedeepprocessskills,oftenwithexpertiseinLean,SixSigma,LeanSixSigmaorothermethodologiesandtools.Typicallythesefolksarewithinbusinessoperationsorspreadacrossbusinessunits,orlessoften,theymaybewithinIT.It’samazinghowoftentheseimpressivespecialistsinprocessexcellenceorprocessimprovementdon’tknowmuchaboutBPMsuitesorthedisciplineofBPM.Inmyview,applyingallthisprocessintellectandfirepowertoimproveortransformaprocesswithoutcodifyingitinsoftwareisamistake.That’sbecauseit’shardtosustainprocesschangeswithoutembeddingtheminthesoftwarethatpeopleusetogetworkdone.ProcesspractitionersneedtounderstandtheothersideoftheBPMcoin—thetechnologiesthatsupportprocesses.

BPMtechnologypocketswithinorganizations.Similarly,afewBPMsoftwarespecialistscanbefoundinisolatedislandsoftheorganization,usuallyinIT.Thesespecialists(andtherearenotmanyofthem)understandhowBPMsoftwareworksandseeitaspartofthenewapplication‐developmentplatformfornext‐generationapplications,whichembodyaprocess.Oftenthesespecialistshavedeepbackgroundsinprogramming:theyunderstandbusinessrulestechnologies,eventmanagement,analytics,socialmedia,andmobiletechnologies,sotheyembracelearningaboutBPMsuitesasanothernewtechnologytobemastered.AndwhiletheseapplicationdevelopersandenterprisearchitectsmayknowandunderstandLeanfromanAgileperspective,theylackmanyofthecoreBPMmethodologydisciplines.TheyneedexposuretothesideofthecointhatLeanandSixSigmaexpertsalreadyunderstand.

ConfusionaboutBPManalystskillsdevelopment.FourgenericpositionsareessentialtoaBPMprogram:1)theBPMchangeagentexecutivewhosellsthevision,drivestheprogramandobtainssponsorship;2)thebusinessarchitectorguruwithabigpictureviewofprocesstransformation;3)theprocessarchitectwho

iii

understandstheinterrelationshipbetweenmanyprocessesandhelpsbuildnewprocesses;and4)theprocessanalyst(orbusinessanalyst)whohelpswiththeas‐is,theto‐be,anddevelopsasingleprocessatatime.Manypeoplebelievethatbusinessanalystswhoalreadyidentifyrequirements—sayforERPorCRM—canmoveintotheBPMprocessanalystjobfairlyseamlessly.ButI’velearnedthroughfeedbackatconferencesanddiscussionswithseniorBPMleadersthatmostbusinessanalystscannotsimplymoveintothatposition:somedon’thavethetechnicalaptitude,whileothersdon’thaveanyinterest.ButsomedohavebothandwanttolearnaboutBPMprocessdesign.Becausethere’sachronicshortageofskilledpeople,we’vegottofindawaytodeveloptheirskillssotheycanmoveintoBPMprojectsandclimbupthecareer‐progressionladderovertime.

It’sanexcitingtimetobeinthisfield.Manynewjobs,ataseniorlevel,arebeingcarvedoutevennow.ThatwillonlyaccelerateasBigProcesstakesholdandorganizationsbecomeprocess‐drivenenterprises.Trainingpeopleforthesepositionsisatremendousneed,ahugeopportunity,andisgreatfortheeconomy,soIamthrilledtoseeABPMPstepuptothechallenge.

iv

ABPMP President’s Note

BPMisarapidlygrowingdisciplinethatischangingthewaybusinesseslookatmanagingprocessesandtheroleofautomationinmanagingthoseprocessesandflowofworkwithinandacrossenterprises.Formanyofus,thisevolvingdiscipline,alongwiththeautomationthatsupportsit,representsarevolutionindeliveringrapidbusinesschangeandinnovativebusinesscapabilitiestooptimizeworkandtherelationshipsbetweencustomers,suppliers,andemployees.Throughthetechniquesandapproachesthatitoffers,BPMhelpstodeliveranewlevelofoperationalmanagementsupportandanewabilitytomonitorandmeasureperformanceatalllevelsinthecompany.Forthosewhoadopttheseapproaches,techniques,andtools,theplayingfieldisabouttochangeandanewparadigmbasedonrapid,iterativechangeisabouttoinitiatenewwaystolookateffectivenessandefficiencyofbusinessprocesses

BPMisnowemergingtosupportenterprise‐widefunctionsandhelpmanagethemtodeliverthepromisesofcontinuousimprovement.Thisemergingcapabilitytodeliverrapidchangehaspromotedanewlevelofcollaborationbetweenbusinessandtechnologyprofessionalswhoneedtounderstandthestrategicnatureandimpactofthechangestheyareimplementing.

ThepowerofcombiningBPMmethods,approaches,andtechniqueswiththesupportingBPMStechnologyisbecomingbetterunderstoodassuccessstoriesbecomemoreandmorecommonacrossmultipleindustries.This,inturn,isdrivingagrowingawarenessofBPMthatwebelievewillcontinueformanyyears.

ThethirdversionoftheABPMPCBOK®isaresponsetoagrowingdemandforinformationonhowBPMreallyworksandhowitcanreallyhelpcompaniescompeteinaglobalcommunity.Asanassociation,ABPMPhasadoptedapositionthattherearetwoverydifferentperspectivesoncreatingaBPMcompetency.Oneiswhatwecallthefoundationalconcepts,whicharebasedontheoryandsomeformofinstruction.Theseareanimportantcomponentofbuildingcompetency,buttheyarefarfromthedefiningsetofcapabilitiesthatensuresuccess.ThatiswhywehavefocusedthisbookandourprofessionalBPMcertificationonpractitioner‐levelknowledgeandexperience.WebelievethatthebroadanddeeppractitionerexperienceisatthecoreofBPM,andthatitisessentialtoensureconsistentsuccessinorganizations.Theresultisthatthisbookisnotsimplytheory.Itcertainlyprovidesinformationonconceptsandonthebasics,butitalsoprovidesadviceanddirectiononwhatneedstobedoneandhowtoapproachdoingit.ThismakestheABPMPCBOK®unique.

Theexperienceoftheauthorsandreviewersisalsoimportantinabookofthistype.Itrepresentsthecollaborationofnumerousauthors,chapterreviewers,andfullCBOKreviewers,allofwhomareexperiencedBPMpractitioners.MostofthesepeoplehavetheirCertifiedBusinessProcessProfessional(CBPP®)designation.AllliveintheBPMtrencheseveryday.

Additionally,theauthorsareall“doers.”Theyworkatalllevels,fromstrategytoSOA,butallrolluptheirsleevesanddothework.Thatgivesadifferentperspective.

v

Thisisnotsimplyacompilationofwhatothershavetoldanauthorininterviews,norisitbasedonlimitedexperience.TheABPMPCBOK®ispracticalandrepresentsdown‐to‐earthdiscussionawiderangeofBPMtopics.

Aswithallemergingdisciplinesorapproaches,terminologyandconceptsareanythingbutstandardized.ThevariancesareevidentinABPMPmeetingsandindiscussionsatconferences,sotheterminologyusedinthisBodyofKnowledgewillcertainlyfollowsuit.RecognizingthisgrowingpainintheBPMindustry,ABPMPprovidesaglossarywithdefinitionsattheendofthisbook.Inaddition,weareintheprocessofcreatingabroadercoverageofterminologyanddefinitionsinaBPMdictionary.Untiltheindustrycanmatureandstandardize,itwillbenecessarytoconsidertermsineachchapterandhowtheyaligntotheonesyouareusedtousing.

Theresultoftheapproachtakeninproducingthisthirdversionisa“howto”lookattopicsthatwehopewillintroducenewideasandconceptstothosewhoreadit.

Aspartsofacommonbodyofknowledge,thechaptersaresemi‐independentofoneanother.EachcoversaspecificareaofBPM.Whilemuchcanbegainedbyreadingthebookfronttoback,covertocover,itismeanttobemuchmore.Theorganizationofthebookpromotesnotonlyageneralreading,butalsoitsuseasareferencethathelpsthereaderaddressdifferentaspectsofBPMprojects.BecauseitisacompendiumofknowledgeandexperienceonBPMandbusinesschange,itshouldbeconsultedasneededforfocusingondifferentareasatdifferentphasesinaproject.

AswithanydiscussiononBPMandbusinesstransformation,weexpectthisinformationtobecomedated.Thisbookaddressesthecurrentandnear‐futureBPMworld.Itrepresentsasoliddiscussiononwhatworks,bypeoplewhomustdeliveritsuseseveryday.Buttheconcepts,techniques,andtoolsarechanging,andABPMPiscommittedasanassociationtokeepingupwiththischange.TheresultisthatweareplanningtosendperiodicupdatesofthisCommonBodyofKnowledgetoourmembers.Ofcourseupdateswillonlytakeussofar,andweknowthatafourthandeventuallyfifthversionwillbeneeded.

OnbehalfoftheAssociationofBusinessProcessProfessionals,IthankyouforengaginginthisdiscussiononBPM.Pleasejoinusasamemberandshareyourexperiencesatourlocalchaptermeetingsoracrossourmembership.Ithinkyouwillenjoythesediscussionswithyourpeers.

TonyBenedict,CBPP

President,ABPMPInternational

vi

About the CBOK

Approaching the CBOK® rewrite —Creating Version 3

TheprojecttorewritetheABPMPCBOKbeganinlate2010.ThefirststepwastoconsiderthecommentsthathadbeencollectedfrompeoplewhowereusingthesecondversionoftheCBOK®.ThiswasaugmentedbycommentsandsuggestionsfromassociationmembersinEuropeandBrazil.Inlate2011,thedecisionwasmadetorewritetheCBOK®.ThiswasbecausetheBPMandBPMSindustrieshadchangesomuchthatitwouldbemorefeasibletostartoverthantosimplyaddinformation.

TheprojecttorewritetheCBOKwasheadedbyDanMorris.Theeffortwasdividedintothreemainsubprojects—thechapterrewrite,thechaptercontentreview,fullCBOKreview.Inaddition,afinalprofessionaleditwasperformedtoensuregrammarandspellingaccuracy.

Therewritesub‐projectwasledbyRajuSaxena,whomadecertainwekepttherewritemoving.ThechapterreviewswereledbyOwenCrowley,whosededicationwasunfailing.DanMorrisalsoledthefullchapterreviewandcoordinatedtheworktoaddresscomments.TonyBenedictledthefinaleditanddiagramcleanup.

Theapproachthatevolvedrecognizedthattheevolutionoftheindustryhasreachedapointwhereitwillbenecessarytocreateabaselineversionandthenmodifyitfrequently.Thismodificationwilladdresscommentsandindustrychangesthroughareleaseofnewsubversionsonanas‐neededbasis.Theintentistohighlightchangesandallowsubscriberstodownloadnewversionsthroughouttheirsubscription.

Guiding Principles

Increatingthisversion,theABPMPboardaskedthatthefollowingprinciplesbeusedtoguidetheauthorsandreviewers.

Focusonbusinesspractitioners SupportacommonunderstandingofBPM Provideaguidetoinformationthataidsthealignmentofteamsand

organizations HelpdefineacommonuseofBPM/BPMSlanguage Makecertainthediscussionsareeasytoread,thorough,andinsightful Referencerelateddisciplines(e.g.IndustrialEngineering,SixSigma,Lean,

etc.) Containcommonlyacceptedpractices Bevendor‐andmethodology‐neutral Guide(don’tprescribe) Includecurrentconcepts

vii

Content

EachchapterintheCBOK®addressesadifferenttopicwithinBPMandismeanttostandalone.Thechaptersdonotfollowachapter‐to‐chapterdiscussionusingacentralcasethatbuildsfromactivitytoactivity.ReadersshouldusetheCBOK®asaguidethatprovidescomprehensivediscussionoftopicsthat,combined,giveabroadoverviewofBPM,BPMS,businesstransformation,andbusinesschange.

ThechaptersintheCBOK®are:

Chapter Title

Chapter1: GuidetotheCBOK

Chapter2: BusinessProcessManagement

Chapter3: ProcessModeling

Chapter4: ProcessAnalysis

Chapter5: ProcessDesign

Chapter6: ProcessPerformanceManagement

Chapter7: ProcessTransformation

Chapter8: ProcessOrganization

Chapter9: EnterpriseProcessManagement

Chapter10: BPMTechnologies

The CBOK® version 3 and the ABPMP CBPP®

TogetherthesetopicsalignwiththeABPMPCertifiedBusinessProcessProfessional(CBPP™)andsupporttheknowledgetestingofthecertificationtest.However,itshouldbenotedthatwhileCBOK®providesafirmfoundationforpractitionerstounderstandthecomponentsofBPM,theCBPP™examinationisnotbasedontheABPMPCommonBodyofKnowledgealone.ExperienceisthekeyfactorinattainingtheproficiencyneededtopasstheCBPPandearncertification.

Authors

TheauthorsofthisCBOK®wereselectedbasedontheirexpertise,asproveninABPMPchaptermeetings,nationalABPMPmeetings,peerreviews,ABPMPcommitteeinvolvement,publishing,speaking,andindustryleadership.AllchapterauthorsareABPMPCertifiedBusinessProcessProfessionals(CBPP).Theyare,asfollows:

Chapter Author Professional Position

CBOK®overview ConnieMoore VicePresidentandResearchDirector,ForresterResearch

viii

Chapter1:GuidetotheCBOK®

RajuSaxena,CBPP

SeniorManager,ErnstandYoung

Chapter2:BusinessProcessManagement

DenisLee,CBPP President,BizArchSolutions,Inc.

Chapter3:ProcessModeling

EmmettPowell,CBPP

PhilVitkus,CBPP

EnterpriseBusinessAnalystandEducator

BusinessProcessAnalystandTechnicalWriter

Chapter4:ProcessAnalysis GabrielleField,CBPP

VPBusinessProcessImprovement,RaymondJamesFinancial

Chapter5:ProcessDesign DanMorris,CBPP

NorthAmericaPracticeManagerforBusinessProcessExcellence,TATAConsultancyServices(TCS)

Chapter6:ProcessPerformanceManagement

JoseFurlan,CBPP

DirectorofEducationServices,JDFurlan&AssociatesLtd.

RajuSaxena,CBPP

SeniorManager,ErnstandYoung

DanMorris,CBPP


Chapter7:ProcessTransformation

DanMorris,CBPP


NancyBilodeau,CBPP

SearsHoldingsCorporation

Chapter8:ProcessOrganization

TonyBenedict,CBPP

VicePresidentSupplyChain,AbrazoHealthcare

Chapter9:EnterpriseProcessManagement

DanMorris,CBPP


ToddLohr,CBPP

ManagingDirector,KPMG

Chapter10:BPMTechnologies

DanMorris,CBPP


MarcScharsig,CBPP

SeniorManagerBPM,Accenture

MichaelFuller IndependentConsultant

ix

Allauthorscontributedonavolunteerbasis.Theinitialconsiderationinselectingauthorswastofindpeoplewiththedeepexpertiseneededtoaddressthetopicsineachofthetenchapters.Oncethiswasdone,arewriteteamwasformedandeachchapter’scontentwasdiscussed.Asthechapterswerebeingwritten,theauthorsmetweeklytodiscussconcepts,approaches,andtechniquestomakecertainthatallalignedintheCBOK®.Thissharingallowedideastobevetted,assuredthecomprehensivenessofcoverage,andcreatedaconsistentABPMPperspective.

Chapter Introductions

Tohelpprovideindustryinsight,theCBOK®committeewasabletoengagenotedBPMexpertstosharetheirviewsonthedirectionthatvarioustopicareasmaybeheadinginoverthenearfuture.Thesediscussionsprovideadditionalvaluetoourreadersbygivingtheminsightintohowthesetopicareasareexpectedtoevolve.

Thefollowingexpertsprovideddiscussionsinthelistedtopicareas.

Chapter Industry Expert Company

CBOK®overview ConnieMoore ForresterResearch

Chapter1:GuidetotheCBOK®

Chapter2:BusinessProcessManagement

JanelleHill Gartner,Inc.

Chapter3:ProcessModeling CraigLeClair ForresterResearch

Chapter4:ProcessAnalysis EliseOlding Gartner,Inc.

Chapter5:ProcessDesign JimSinur Gartner,Inc.

Chapter6:ProcessPerformanceManagement

DavidMcCoy Gartner,Inc.

Chapter7:ProcessTransformation DavidKish TCSGlobalConsultingPractice

Chapter8:ProcessOrganization AndrewSpanyi SpanyiInternationalInc.

Chapter9:EnterpriseProcessManagement

PeterFingar Author

Chapter10:BPMTechnologies Dr.MathiasKirchmer

Accenture

x

Quality and the ABPMP CBOK®

QualityhasbeenamainconcernthroughouttheCBOK®rewriteprocess.Ourgoalwastoupdatethecoverageinthelastversion,addingnewideas,changesinthemarketplaceunderstandingofBPM,andchangesintheBPMStechnology.Todothis,ABPMPtookanapproachthatwasbuiltonchecksandbalances.

Toensurethattherewerenocoverageholesandtouncoveranycontroversialdiscussions,areviewcommitteewasformedfromadditionaltopicexperts.AllmembersofthereviewcommitteeareABPMPCertifiedBusinessProcessProfessionals(CBPP).Thesereviewerswentthrougheachchapteranddiscussedanyissuesincommittee.Thediscussionsresultedinchangesthatexpandedcontentandprovidedadifferent,broaderperspectiveonthetopiccoverage.

ThereviewcommitteewasmanagedbyOwenCrowley,withcontentadvisoryprovidedbyDanMorrisandGabrielleField.Owenmadecertainthatthereviewersremainedfocusedoncontentqualityduringthesixmonthsofthedetailedreview.Thereviewteammemberswere:

Review Committee Role Professional Position

OwenCrowley,CBPP

ReviewCommitteeManager

President,ExogeneCorp.

ToddLohr,CBPP

Member ManagingDirector,KPMG

MarcScharsig,CBPP

Member SeniorManagerBPM,Accenture

PhilVitkus,CBPP

Member IndependentConsultant

ChrisOttesen Member SpecialistLeader,GlobalMethodsandTools,AMEA,DeloitteConsultingLLP

DanMorris,CBPP

ReviewCommitteeAdvisor NAPracticeManager,BusinessProcessExcellence,TATAConsultancyServices(TCS)

Full CBOK® quality review

Oncemodificationswerecompleted,thenewCBOK®wasreviewedinitsentiretybytheoriginalauthors,thereviewcommittee,andathirdgroupofnewreviewers.Thegoalofthisreviewwastomakesurethatthenewversionwasunderstandableandcomplete.

Thisapproachensuredtheaccuracyandcompletenessofcontent,aswellasthequalityandcurrencyofideasanddiscussions.Thereviewdeliveredafullyvetted

xi

andapproveddiscussionofabroadrangeofBPMandBPMStopics.ItalsoallowedthefullCBOK®reviewteamtomakeafinalchecktoensurethatthediscussionsintheCBOK®alignedwiththecurrentwisdom,philosophiesandapproachespromotedbytheassociationandacceptedbyleadingindustryexperts.

CompleteCBOK®version3reviewers:

Reviewer Company

TonyBenedict VicePresidentSupplyChain,AbrazoHealthcare

DanMorris NorthAmericanPracticeManager,BusinessProcessExcellence,TATAConsultancyServices(TCS)

ConnieMoore VicePresidentandResearchDirector,ForresterResearch

JanelleHill VicePresidentandDistinguishedAnalyst,Gartner,Inc.

MarcScharsig SeniorManagerBPM,Accenture

ToddLohr ManagingDirector,KPMG

ChrisOttesen SpecialistLeader,GlobalMethodsandTools,AMEA,DeloitteConsultingLLP

RajuSaxena SeniorManager,ErnstandYoung

DenisLee President,BizArchSolutions,Inc.

EmmettPowell EnterpriseBusinessAnalystandEducator

OwenCrowley President,ExogeneCorp.

PhilVitkus IndependentBPMConsultant

NancyBilodeau DirectorLoyaltyPartnerProgram,SearsHoldingsCorporation

Completing the CBOK®

Afinaleditwasperformedbyaprofessionaleditortoensureformatconsistency,grammaticalcorrectness,andspellingaccuracy.Inaddition,graphicswererevisedbyaprofessionalgraphicsartisttoensureconsistencyandquality.

Vendor references

InBPMandBPMS,manyvendorsandresearchfirmscreatereferencemodelsandusedifferentterminologyinboththeireverydaydiscussionsandinthesemodels.ABPMPhasNOTadoptedanyspecificresearchfirms’,vendors’,orconsultingfirms’models.Instead,weuseavarietyofthesemodelsthroughouttheCBOKtoacquaintthereaderwithdifferentmodelsandtoshowthatthechoiceofmodelisnotsoimportant:rather,what’simportantisthatthereader’scompanyeitherselectonemodelforeachissue(suchasBPMmaturityandprocessmanagementmaturity)and

xii

usethatmodelconsistently,orthattheyunderstandthatvariousmodelsareinuseandadjustaccordingly.

The CBOK®

Future versions

BPMandBPMSarechangingrapidly,andanydiscussionwillneedtoberevisedandupdatedcontinuously.Todothis,ABPMPwillreleaseupdatestochaptersonanongoingbasis.ThesewillbeavailableontheABPMPwebsitetoABPMPmembersandotherswhopurchaseannualCBOK®licenses.

Werecognizethat,regardlessofthestepswehaveputinplacetodeliveraqualityproduct,theremaybetopicsthatmemberswouldlikeaddedandpointsthatmightbemorefullydiscussed.ThegoalistoprovideafoundationorframeworkfortheBPMindustryandhelpourmembersandotherreadersobtainacomprehensiveperspectiveofthetopicsandissuesthattheymustdealwithtodeliverimprovementandtransformation.

ReaderswhowouldliketoseeadditionaltopicsordiscussionsinfutureversionsareinvitedtosendallsuggestionsorrecommendationsforchangestoABPMPatEdcomm@abpmp.org

Comments

PleasesendcommentstoABPMPthroughourwebsite,andletusknowifthereareanytopicsyoubelieveweshouldincludeorifyouhavedisagreementswiththeassociation’spointofview.Yourcommentswillbeusedasafoundationforfutureversions.

xiii

Preface

Defining a Business Process Management Professional

ThefollowingisanexcerptfromanarticlewrittenbyBrettChamplin,pastPresidentoftheAssociationofBusinessProcessManagementProfessionals(ABPMP),forBPMStrategies,October2006edition.

Business Process Management Professionals

AtseveralrecentBPMconferences,Ihaveaskedaudiencesofseveralhundredattendeestogivemeashowofhands,firstfor“WhoisfromIT?”Generallyabout30‐45%ofthehandsgoup;then,“WhoisfromtheBusinessside?”Another30‐45%;then,“Whohereislikeme,stuckinthemiddle?”Nearlytheentiregroupraisestheirhands,generallyemphatically.Thisistelling.Manyofuswhoworkinprocessmanagement,processredesign,processperformanceanalysis,processautomation,andthelike,areconflicted.ArewebusinesspractitionerswhohavetounderstandhowtoleverageITtomanagebyprocessorareweITpractitionerswhohavetounderstandthebusinessinordertofullyutilizethecapabilitiesofnewITsolutions?

BPMisbothamanagementdisciplineandasetoftechnologiesthatsupportmanagingbyprocess.Aconvergenceoftechnologiesforworkflow,enterpriseapplicationintegration(EAI),documentandcontentmanagement,businessrulesmanagement,performancemanagementandanalyticsamongotherhavebeenbroughttobearwithafocusonsupportingprocessbasedmanagement.AfewyearsagoBPMsoftwarevendorswerefocusedontheexecutionlayerofthetechnologystack.TodaytheyaredeliveringBPMSuiteswithafullrangeoffeaturesandfunctionstosupportprocessmanagersandanalystsaswellastechnologydevelopers.

RecentresearchstudiesconfirmthatBusinessProcessManagement(BPM)israpidlyevolvingasthedominantmanagementparadigmofthe21stCentury.AnApril2005BPMGstudyfoundthat“…thepracticeofBPMasaprimarymeanstomanagebusinesshasalreadygainedsubstantialadoption”and“…morethan80%oftheworld’sleadingorganizationsareactivelyengagedinBPMprograms,manyoftheseonaglobalscale.”AnAPQCbenchmarkingstudycompletedinMarch2005foundthat“BPMisthewaybest‐practiceorganizationsconductbusiness.”Thatstudyalsoexaminedprovenstrategies,approaches,toolsandtechniques(includingbusinessprocessframeworksandmaturitymodels)employedbyworld‐class,process‐focusedenterprisesandfoundthatwhile“technology,byitself,doesnotconstituteBusinessProcessManagement,muchofthepromiseofBPMinitiativeswillnotberealizedwithoutpowerful,flexibleanduser‐friendlyITsolutionstosupportthem.”

BusinessProcessManagementandPerformanceManagementaremergingasmoreandmoreprocessmanagementgroupsbegintorecognizetheorganizationasasystemofinteractingprocesseswhoseperformancemustbebalanced,andthatmustbethefocusoffulfillingstrategies.Conversely,moreandmoreofthoseengagedinenterpriseperformancemanagementarerealizingthatitisthe

xiv

performanceofthebusinessprocesses,nottheorganizationalfunctionalunitsorasetofassets,thathastobetheircentralfocusinordertogainthetruebenefitsofaperformancemanagementinitiative.Sophisticatedandpowerfulnewtechnologiesarecentraltosuccessfulandsustainableprogramsforbothofthesedisciplines,andintegratingtheinformationdeliverycapabilitiesaswellasmanagementmethodsiscriticaltomovingupthescaleofmaturityindeployingthesepractices.

Alongwiththisbusinessprocessmanagementrevolution,neworganizationalstructuresandrolesareemergingandanewgenreofprofessionalsisemergingtosupportthesepractices.Yet,businessschoolsdon’tteachushowtomanagebyprocess.Notextbookstelluswhatrolesandresponsibilitiesweneedtoputinplaceinordertodothiskindofwork.Thereisnoauthoritativeresearchtoindicateexactlyhowweshouldstructureourgovernanceandoperationstodothiskindofwork.Infact,whatresearchthereisindicatesthatthereisno“one‐size‐fits‐all”solution.Variousmodelsandroleshaveprovensuccessfulinvariousindustries,noneshowinganyclearadvantageovertheother.Onethingthatisclearisthatmanagingbyprocessandadaptingnewinformationsystemstoolstosupportthoseactivitiesisasuccessfulstrategythatbringstremendousadvantagetothosebusinessesthatadoptit.And,itseemsthatthemorebroad‐basedtheprocessmanagementinitiativeisintheorganization,themoreeffectiveitisandthemorevalueitadds.

ThereseemtobeasmanycompanieswhoseBPMeffortsaredrivenbytheirITorganizationsastherearethosewhoseBPMprogramsarebeingledbycorebusinessareas.Likewise,thereseemtobetwomajorapproaches:thosethataremoreproject‐orientedversusthosethatviewBPMasacontinuousprocessimprovementandtransformationeffort.Thesedifferentmodelsgeneraterolesandresponsibilitieswithwidelyvaryingtitlesandalignmentsofresponsibilities,yetallareprocess‐managementfocused.

WithintheAssociationofBPMProfessionals,ourmembershipshowsadiversityoftitlesthatreflectthesedivergentapproachestoprocessmanagement.Wehavewellover150differenttitlesrepresentedinourdatabase,althoughthereareclustersaroundsomeofthetitleslikeManager,Director,VP,Analyst,Consultant,andArchitect,usuallyprecededorfollowedbyProcess,BPM,ProcessImprovement,ProcessInnovation,andthelike.

OnerolethatisparticularlysignificantinBPMprogramsisthatoftheProcessOwner.Dependingonwhethertheorganizationrestructuresaroundcross‐functionalbusinessprocesses,createsamatrix‐managedorganization,appointsfunctionalmanagerstotakeonadualrole,orreliesonacross‐functionalcouncilofmanagerstooverseecorebusinessprocesses,itwillensurethatsomeonetakesontheresponsibilitiesofa“ProcessOwner”foreachoftheorganization’skeyoperationalprocesses.Thisroleseemstobeoneofthecriticalsuccessfactorsineffectiveprocess‐orientedorganizations.

AnorganizationalfactorthatseemstoreflecttheevolutionormaturityinorganizationsimplementingBPMistheexistenceofaspecializedgroupthatis

xv

recognizedastheprocessspecialists.ManybeginwithaBPM“CenterofExcellence”orsimilargroupthatprovidestotheorganizationprocessmodeling,analysis,design,andprojectexpertisealongwithstandardtools,methodsandtechniquesandactsasaninternalconsultinggroup.Amorematureorexperiencedprocess‐orientedorganizationwillhaveaprocessmanagementgovernancegroupor“ProcessManagementOffice”thatoverseestheorganization’sportfolioofprocesses,andaligns,prioritizes,andauthorizestransformationefforts.Andsomecompaniesmayhavebothtypesofgroupsworkingtogether.Thesegroupsarestaffedwithprocessmanagementprofessionalswithawiderangeoftitlesandalignmentofresponsibilities.

WhilethereseemtobemanysuccessfulmodelsforimplementingBPMinorganizations,onethingtheyallhaveincommonisthemanynewroleswithnewsetsofskillsandresponsibilitiesallcenteredonBPM.Thisisanemerginggroupofprofessionalswhoseworkisessentialto21stcenturybusiness:thebusinessprocessprofessional.JudgingfromthemembersofABPMP,theyaregenerallyhighlyeducated(67%haveabachelororadvanceddegree)andhaveasignificantamountofexperience(9.9yearsaverage)workinginprocessimprovementandredesign.

Someofthemorecommonrolesare:

BusinessProcessAnalyst BusinessProcessEngineer BusinessProcessArchitect BusinessProcessManager BusinessProcessConsultant BusinessProcessManager BusinessProcessOwner BusinessAnalyst BusinessSystemsAnalyst ManagerorDirectorofBusinessPerformanceImprovement ManagerorDirectorofBusinessProcessInnovation ProcessOwner ProcessOfficer

Thesetitlesandtheirvariantscoverthemajorityofthenewrolesandresponsibilitiesinprocess‐managedorganizations.Regardlessoftherolesororganizationalstructure,theygenerallyareresponsibleforthesamesetsofactivities:ProcessModeling,ProcessAnalysis,ProcessDesign,ProcessChangeandTransformation,ProcessImplementation,ProcessMonitoringandControl,andProcessPerformanceImprovement.SomeoftheserolesmaybestaffedinITorganizationsandsomeinbusinessdisciplines.Manyorganizationsarestaffingwithcross‐disciplinegroupscombiningbothITandbusinessknowledgeorwithpeoplewhohaveservedinbothITandbusinessunits,bringingadepthofknowledgeandrangeofskillsthattranscendtraditionalboundaries.Manyhavefoundthatcombiningpeoplewhohavegeneralconsulting‐typeknowledgeandskillswith

xvi

otherswhohaveadepthofbusiness‐specificknowledgeisasuccessfulstrategyforBPMefforts.

Thereisanewprofessionalinthebusinessworldtoday,thebusinessprocessprofessional.Theworktheydoiscriticaltothefutureofcompetitiveorganizations.And,eventhoughthereisnosingleorclearmodelthatonecanadopt,itdoesn’tdiminishtheneedformoreskilledandmotivatedpeopletodothiswork.Eventually,universitieswillcomeoutwithwell‐researchedandstructuredmodelsbasedonsomeofthemostvisiblesuccessstories.Inthemeantime,businessescan’twaitforsomeonetotellthemthe“best”waytodothis;theyhavetodothisworktoday,andtherejustaren’tenoughknowledgeable,skilledpeopletogoaround.Successfulorganizationsarefindingthattostaffthesegroups,theyhavetoinvestintraininganddevelopment.Somearebuildingtheirowncurriculaandtrainingprogramsandbringingentry‐levelpeopleonboardtoworkcloselywiththefewtalentedBPMprofessionalstheydohave.Othersaresendingmanagers,projectleaders,andsystemsanalyststotraining,suchastheBPM‐Institutecertificateprogram,tobegintobuildtherequisiteknowledgeandskills.Thissituationwilllikelycontinuetobethemostviableapproachtobuildingprocessorganizationsforthenearfuture.

ThemissionofABPMPandEABPMistoengageinactivitiesthatpromotethepracticeofbusinessprocessmanagement,todevelopacommonbodyofknowledgeinthisfield,andtocontributetotheadvancementandskilldevelopmentofprofessionalswhoworkinthisdiscipline.ABPMPandEABPM’slocalchaptersproduceperiodiceventsfeaturingcasestudiesandpresentationsaboutBPMtopics,whichprovidesaninexpensivecontinuingeducationprogramfortheirmembers.ABPMPandEABPMhaveaneducationcommitteethatisdevelopingaBPMCommonBodyofKnowledge.Followingthat,wewillproducerecommendedcurriculaforacademicandtrainingprograms.Weintendtocreateasetofcriteriatoevaluatetrainingprogramsandaprocessforformalendorsementoftrainingprovidersandacademicprograms.Followingthat,wewilldevelopaprofessionalcertificationprogramtocertifypractitionersandexpertbusinessprocessmanagementprofessionals.

IthinkworkinginBPMatthistimeisthemostexcitingandvaluablebusinessexperiencemanagersandprofessionalscangettoday.IseeBusinessProcessManagementprofessionalsasthenewtrainingbackgroundforfuturebusinessleaderstoday,muchasprojectmanagementwas15yearsago.However,weneedtodevelopsomebaselinestandards,minimumqualifications,andsomereasonablepathforbecomingaprofessionalinthisarea.Ifyouareworkinginprocessmanagement,joinothersindevelopingtheprofession—joinABPMPtoday.Togetherwecanbuildanewprofessionaldisciplinethatwillcreatethefuture.

xvii

The Association of Business Process Management Professionals

Background on ABPMP

TheAssociationofBusinessProcessManagementProfessionals(ABPMP)isanon‐profit,vendor‐independentprofessionalorganizationdedicatedtotheadvancementofbusinessprocessmanagementconceptsandpractices.ABPMPispractitioner‐orientedandpractitioner‐led.

ABPMPhaslocalchaptersinseveralUSareas,andmanymoreareformingintheUSandinternationally.Individualswishingtoparticipatewhoarenotlocatednearanexistinglocalchapterareurgedtoinvestigatethefeasibilityofstartingachapterintheirlocality.Whennotaffiliatedwithalocaloperatingchapter,memberswillbepartoftheMembersAt‐Largechapter,whichhasitsownelectedofficersandparticipatesinABPMPactivitiesasanyotherchapterwould.

ABPMPisgovernedbyanelectedBoardofDirectors.Eachchapterpresidentisanex‐officio,votingmemberoftheInternationalBoardofDirectors.ABPMPalsohasaBoardofAdvisorsmadeupofsomeofthemostwellknownauthors,practitioners,andthought‐leadersinthefield.TheseadvisorsarevolunteerswhoperiodicallyofferadvicetothechaptersandBoardofDirectorsconcerningtheindustryandhowABPMPcanbestserveitsmembers.

ABPMPisaffiliatedwithotherprofessionalorganizations,includingtheEuropeanAssociationofBusinessProcessManagement(EABPM),whichadministerstheABPMPcertificationprocessandtranslatestheBPMCBOK®intotheFrenchandGermanlanguages.AdditionalaffiliationsaredescribedintheAppendixlabeled“ReferenceDisciplines.”

FormoreinformationonABPMP,pleaseseeourwebsiteatwww.abpmp.org.FormoredetailsaboutEABPMseethewebsiteatwww.eabpm.org

Core Mission / Values / Operation

TheAssociationofBusinessProcessManagementProfessionalsisanon‐profit,vendor‐neutralprofessionalorganizationdedicatedtotheadvancementofbusinessprocessmanagementconceptsandpractices.ABPMPispractitioner‐orientedandpractitioner‐led.

Vision

ThevisionoftheABPMPisto

Bethecenterforthecommunityofpracticeinbusinessprocessmanagement Providetheleadingprofessionalsocietyforbusinessprocessmanagement

professionals Definethedisciplineandpracticeofbusinessprocessmanagement Recognize,acknowledgeandhonorthosewhomakeoutstanding

contributionstothebusinessprocessmanagementdiscipline.

Mission

ThemissionofABPMPis

xviii

Toengageinactivitiesthatpromotethepracticeofbusinessprocessmanagement,

TodevelopaCommonBodyofKnowledgeforBPM,and Tocontributetotheadvancementandskilldevelopmentofprofessionals

whoworkintheBPMdiscipline.

Operation

TheABPMPproduceseducationalandnetworkingeventsforcontinuingeducationandsharingofbestpractices,newideas,andexperiencesofitsmembersandprofessionalcolleagues.InformationontheseeventscanbefoundontheABPMPwebsiteatwww.abpmp.org.

Code of Ethics

ABPMPiscommittedtothehigheststandardofprofessionalethicsandbelievesthatBusinessProcessManagementProfessionalsshould

Conducttheirprofessionalandpersonallivesandactivitiesinanethicalmanner Recognizeastandardofethicsfoundedonhonesty,justiceandcourtesyas

principlesguidingtheirconductandwayoflife Acknowledgethatthereisanobligationtopracticetheirprofessionaccordingto

thiscodeofethicsandstandardsofconduct.

AllABPMPmembersmustagreetoandsignthefollowingcodeofethicsandstatementofprofessionalconduct:

Thekeystoneofprofessionalconductisintegrity.BusinessProcessManagementProfessionalswilldischargetheirdutieswithfidelitytothepublic,theiremployers,andclientswithfairnessandimpartialitytoall.Itistheirdutytointerestthemselvesinpublicwelfare,andbereadytoapplytheirspecialknowledgeforthebenefitofhumankindandtheenvironment.

Iacknowledgethat

Ihaveanobligationtosocietyandwillparticipatetothebestofmyabilityinthedisseminationofknowledgepertainingtothegeneraldevelopmentandunderstandingofbusinessprocessmanagement.Further,Ishallnotuseknowledgeofaconfidentialnaturetofurthermypersonalinterest,norshallIviolatetheprivacyandconfidentialityofinformationentrustedtomeortowhichImaygainaccess.

Ihaveanobligationtomyemployer/clientwhosetrustIhold.Therefore,Ishallendeavortodischargethisobligationtothebestofmyability,toguardmyemployer/clientsinterests,andprovideadvicewiselyandhonestly.Ishallpromotetheunderstandingofbusinessprocessmanagementmethodsandproceduresusingeveryresourceavailabletome.

Ihaveanobligationtomyfellowmembersandprofessionalcolleagues.Therefore,IshallupholdthehighidealsofABPMPasoutlinedintheAssociationBylaws.Further,Ishallcooperatewithmyfellowmembersandshalltreatthemwithhonestyandrespectatalltimes.

xix

IaccepttheseobligationsasapersonalresponsibilityandasamemberofthisAssociation.IshallactivelydischargetheseobligationsandIdedicatemyselftothatend.

Standards of Conduct

ThesestandardsexpandontheCodeofEthicsbyprovidingspecificstatementsofbehaviorinsupportoftheCodeofEthics.Theyarenotobjectivestobestrivedfor;theyarerulesthatnoprofessionalwillviolate.Thefollowingstandardsaddresstenetsthatapplytotheprofession.

Inrecognitionofmyprofessionalobligations,Ishall

Avoidconflictofinterestandmakeknownanypotentialconflicts Protecttheprivacyandconfidentialityofallinformationentrustedtome AcceptfullresponsibilityforworkthatIperform Ensurethattheproductsofmyworkareusedinasociallyresponsibleway,to

thebestofmyability Support,respect,andabidebytheappropriatelocal,national,andinternational

laws MakeeveryefforttoensurethatIhavethemostcurrentknowledgeandthatthe

properexpertiseisavailablewhenneeded Sharemyknowledgewithothersandpresentfactualandobjectiveinformation

tothebestofmyability Befair,honest,andobjectiveinallprofessionalrelationships Cooperatewithothersinachievingunderstandingandinidentifyingproblems Protecttheproperinterestsofmyemployerandmyclientsatalltimes Takeappropriateactioninregardtoanyillegalorunethicalpracticesthatcome

tomyattention;IwillbringchargesagainstanypersononlywhenIhavereasonablebasisforbelievinginthetruthoftheallegationsandwithoutanyregardtopersonalinterest

Notuseknowledgeofaconfidentialorpersonalnatureinanyunauthorizedmannerortoachievepersonalgain

NevermisrepresentorwithholdinformationthatisgermanetoaproblemorsituationofpublicconcernnorwillIallowanysuchknowninformationtoremainunchallenged

Nottakeadvantageofalackofknowledgeorinexperienceonthepartofothers Notuseortakecreditfortheworkofotherswithoutspecificacknowledgement

andauthorization Notmisuseauthorityentrustedtome.

WearealwaysconcernedaboutthequalityofourinformationandwehavetakencaretoveteverydiscussioninthisCBOKthroughmultiplereviewsbytopBPMprofessionals.PleasecontactuswithcommentsonthisversionofourBPMCommonBodyofKnowledge.InformationontheABPMPAssociationisprovidedonourwebsiteathttp://www.abpmp.org/

ABPMPInternationalBoardofDirectors

xx

Table of Contents

ForewordbyConnieMoore,VicePresidentandPrincipalAnalyst,ForresterResearch....................................................................................................................................................2

ABPMPPresident’sNote...................................................................................................................iv

AbouttheCBOK.....................................................................................................................................vi

Preface...................................................................................................................................................xiii

TheAssociationofBusinessProcessManagementProfessionals..............................xvii

TableofContents....................................................................................................................xx

Chapter1..................................................................................................................................25

GuidetotheCBOK®...............................................................................................................25

1.0 Introduction.............................................................................................................................27

1.1 PurposeoftheGuidetotheBPMCBOK®...................................................................27

1.2 StatusandFeedback.............................................................................................................28

1.3 CBOK®Organization:SummaryofChapters............................................................28

1.4 OverviewofChapters...........................................................................................................29

1.5 BenefitsofBPM.......................................................................................................................31

1.6 BPMOverview.........................................................................................................................36

Chapter2..................................................................................................................................39

BusinessProcessManagement.........................................................................................39

ForewordbyJanelleHill,VPGartner,Inc................................................................................40

2.0 Introduction.............................................................................................................................43

2.1 WhatisBusinessProcessManagement?.....................................................................43

2.2 BPMCoreConcepts...............................................................................................................44

Chapter3..................................................................................................................................83

ProcessModeling...................................................................................................................83

ForewordbyCraigLeClair,VP,PrincipalAnalyst,ForresterResearch.....................84

3.0 Introduction.............................................................................................................................88

3.1 BusinessProcessModeling................................................................................................88

3.2 PurposeofProcessModeling............................................................................................91

3.3 CommonlyUsedProcessModelingNotations...........................................................93

3.4 SpecializedApproachesinProcessModeling.........................................................106

xxi

3.5 ProcessModelLevels........................................................................................................111

3.6 Bottom‐UpandTop‐DownModelingApproaches...............................................117

3.7 CapturingProcessInformation,andModelingParticipants............................118

3.8 FrameworksandReferenceModels...........................................................................120

3.9 ModelingTechniquesandTools...................................................................................121

3.10 ProcessValidationandSimulation...........................................................................122

3.11 KeyConcepts......................................................................................................................123

Chapter4................................................................................................................................125

ProcessAnalysis...................................................................................................................125

ForewordbyEliseOlding,Gartner,Inc..................................................................................126

4.0 Introduction..........................................................................................................................130

4.1 WhatisProcessAnalysis?...............................................................................................130

4.2 WhydoProcessAnalysis?...............................................................................................131

4.3 WhentoPerformAnalysis..............................................................................................132

4.4 ProcessAnalysisRoles......................................................................................................133

4.5 PreparingtoAnalyzeProcess........................................................................................134

4.6 GatheringInformation......................................................................................................142

4.7 DocumenttheAnalysis.....................................................................................................150

4.8 Considerations.....................................................................................................................150

4.9 Conclusion..............................................................................................................................154

4.10 KeyConcepts.......................................................................................................................154

Chapter5................................................................................................................................156

ProcessDesign......................................................................................................................156

ForewordbyJimSinur,VP,Gartner,Inc...............................................................................157

5.0 Introduction..........................................................................................................................160

5.1 WhatisProcessDesign?..................................................................................................160

5.2 ProcessDesignFoundation............................................................................................164

5.3 ProcessDiscovery–The“AsIs”or“currentstate”...............................................170

5.4 StrategicBusinessChange..............................................................................................177

5.5 ProcessAnalysis—Gaininganunderstandingofthebusiness.......................178

5.6 ProcessandWorkFlowDesign—Creatingthe“ToBe”Design......................180

5.7 ChangeManagement.........................................................................................................193

xxii

5.8 ITInfrastructureAnalysisandDesign.......................................................................194

5.9 SimulationModeling..........................................................................................................195

5.10 Conclusions.........................................................................................................................196

5.11 KeyConcepts.......................................................................................................................196

Chapter6................................................................................................................................197

ProcessPerformanceManagement...............................................................................197

ForewordbyDavidMcCoy,ManagingVicePresidentandGartnerFellowEmeritus.................................................................................................................................................................198

6.0 Introduction..........................................................................................................................204

ProcessPerformanceManagementSectionI......................................................................205

6.1 WhatisProcessPerformanceManagement?..........................................................205

6.2 Whatisprocessperformance?......................................................................................216

6.3 WhatcanProcessPerformanceMeasurementtellyou?....................................220

6.4 MeasurementandManagement...................................................................................223

6.5 Findingouthowtomeasureperformance..............................................................228

6.6. BuildingaPerformanceMeasurementCapability...............................................231

ProcessPerformanceManagementSectionII....................................................................233

Introduction.......................................................................................................................................233

6.7 Importanceandbenefitsofperformancemeasurement...................................233

6.8 Keyprocessperformancedefinitions........................................................................235

6.9 Monitoringandcontrollingoperations.....................................................................239

6.10 Alignmentofbusinessprocessandenterpriseperformance.......................242

6.11 Whattomeasure..............................................................................................................243

6.12 Thevoiceoftheprocess................................................................................................247

6.13 Simulationoffuturestate.............................................................................................251

6.14 Decisionsupportforprocessownersandmanagers.......................................253

6.15 Processperformancemanagementmaturityframework..............................254

6.16 Considerationsforsuccess...........................................................................................256

6.17 KeyConcepts......................................................................................................................257

Chapter7................................................................................................................................260

ProcessTransformation....................................................................................................260

ForewordbyTonyBenedict,VPSupplyChain,AbrazoHealthcare;President,ABPMP..................................................................................................................................................261

xxiii

7.0 Introduction..........................................................................................................................265

7.1 Transformation:BeyondImprovement....................................................................265

7.2 ExecutiveCommitment....................................................................................................271

7.3 Changemanagement:Gettingthestaffbehindtransformation.....................274

7.4 GettingReadyforProcessTransformation.............................................................296

7.5 Transformingthebusiness:reachingoptimization.............................................301

7.6 SustainingOptimization...................................................................................................309

7.7 KeyConcepts.........................................................................................................................311

Chapter8................................................................................................................................313

ProcessOrganization.........................................................................................................313

ForewordbyAndrewSpanyi,ManagingDirector,SpanyiInternationalInc........314

8.0 Introduction..........................................................................................................................317

8.1 TheProcess‐DrivenOrganization................................................................................317

8.2 FromHierarchicalStructurestotheProcess‐DrivenOrganization..............320

8.3 ProcessManagementRoles............................................................................................323

8.4 GoverningBodies................................................................................................................329

8.5 ASummaryDiscussion.....................................................................................................335

8.6 KeyConcepts.........................................................................................................................335

Chapter9................................................................................................................................338

EnterpriseProcessManagement...................................................................................338

ForewordbyPeterFingar,BusinessStrategy,BPM,andGlobalizationAdvisoratPeterFingar.com...............................................................................................................................339

9.0 Introduction..........................................................................................................................344

9.1 TransitioningtoEnterpriseProcessManagement...............................................345

9.2 Currentstate:AssessingProcessMaturity..............................................................352

9.3 ProcessEnablement..........................................................................................................354

9.4 ProcessGovernance...........................................................................................................356

9.5 BusinessProcessManagementRoadmap................................................................359

9.6 ProcessManagementCenterofExcellence.............................................................359

9.7 BPMIntegrationinSupportofProcessManagement.........................................362

Chapter10..............................................................................................................................366

BPMTechnology...................................................................................................................366

xxiv

ForewordbyDr.MathiasKirchmer,ExecutiveDirectorBPMandGlobalLeadBusinessProcessManagement‐Lifecycle(BPM‐L)Practice,Accenture.................367

10.0 Introduction.........................................................................................................................370

10.1 EvolutionofBPMTechnologies..................................................................................372

10.2 BPMTechnology:EnablingBusinessChange.......................................................373

10.3 CapabilitiesofBPMtechnologies..............................................................................380

10.4 MakingBPMtechnologiesworkforyou.................................................................403

10.5 BPMSGovernance.............................................................................................................409

10.6 ComingSoontoHelpDeliverFlexibility..................................................................415

10.7 VisionoftheFuture.........................................................................................................418

10.8 Summary:AdvantagesandRisksofProcessAutomation...............................420

10.9 KeyConcepts......................................................................................................................420

Glossary...................................................................................................................................423

xxv

Chapter 1

Guide to the CBOK®

Chapter1.GuidetotheCBOK®

26

CONTENTS

GuidetotheCBOK®...............................................................................................................25

1.0 Introduction.............................................................................................................................27

WhatistheGuidetotheBPMCBOK®?.................................................................................27

1.1 PurposeoftheGuidetotheBPMCBOK®...................................................................27

1.2 StatusandFeedback.............................................................................................................28

1.3 CBOK®Organization:SummaryofChapters............................................................28

1.4 OverviewofChapters...........................................................................................................29

1.5 BenefitsofBPM.......................................................................................................................31

1.5.1BenefitstotheEnterprise...............................................................................................33

1.5.2 BenefitstoCustomers.................................................................................................34

1.5.3 BenefitstoManagement.............................................................................................34

1.5.4 BenefitstoActors..........................................................................................................35

1.6 BPMOverview.........................................................................................................................36

LiteratureReferences..................................................................................................................37

Copyright A

BPM

P InternationalChapter1.GuidetotheCBOK®

27

1.0 Introduction

What is the Guide to the BPM CBOK®?

AsBPMbusinesspractices,managementdiscipline,andenablingtechnologiesmature,ourunderstandingofBPMalsomatures.ThereisatremendousbodyofknowledgeonBPM,includinghundredsofbooks,articles,presentations,processmodelsandbestpractices,whicharebaseduponpracticeexperience,academicstudy,andlessonslearned.ThetrendinBPMtodayfocusesonenterprise‐wide,cross‐functionalprocessesthataddvalueforcustomers(bothinternalandexternal).Businessprocessesdefinehowenterprisesperformworktodelivervaluetotheircustomers.Thepurposefulmanagementoftheseprocessescreatesstrongerbusinesspracticesthatleadtomoreeffectiveworkflow,greaterefficiencies,moreagility,andultimatelyhigherreturnsonstakeholders’investments.

ItwouldbeimpracticaltocollectandpresentinasinglevolumealloftheavailableknowledgeonthepracticeofBPM.ThisguidetotheBPMCommonBodyofKnowledgeisdesignedtoassistBPMprofessionalsbyprovidingacomprehensiveoverviewoftheissues,bestpractices,andlessonslearnedascollectedbytheABPMPandaffiliatedassociations.BPMisaconstantlyevolvingdiscipline.Version3.0oftheABPMPBPMCBOK®providesabasicunderstandingofBPMpracticealongwithreferencestotheBPMcommunityandothervaluablesourcesofinformation.BPMprofessionalsareencouragedtousethisguideinconjunctionwithavarietyofothersourcesofinformation,getinvolvedintheBPMcommunity,andexpandandsharetheirknowledgeonthepracticeofBPM.

BecausethetermBusinessProcessManagement(BPM)isusedsofrequentlythroughoutthispublication,herefollowsitsdefinitionasappliedhere:

BusinessProcessManagement(BPM)isamanagementdisciplinethatintegratesthestrategyandgoalsofanorganizationwiththeexpectationsandneedsofcustomersbyfocusingonend‐to‐endprocesses.BPMcomprisesstrategies,goals,culture,organizationalstructures,roles,policies,methodologies,andITtoolsto(a)analyze,design,implement,control,andcontinuouslyimproveend‐to‐endprocesses,and(b)toestablishprocessgovernance.

1.1 Purpose of the Guide to the BPM CBOK®

ThisGuidetotheBPMCBOK®providesabasicreferenceforBPMpractitioners.TheprimarypurposeofthisguideistoidentifyandprovideanoverviewoftheKnowledgeAreasthataregenerallyrecognizedandacceptedasgoodpractice.Itincludesrolesandorganizationalstructuresaswellasprovisionstosteeraprocess‐drivenorganization.TheGuideprovidesageneraloverviewofeachKnowledgeAreaandalistofcommonactivitiesandtasksassociatedwitheachKnowledgeArea.It

Copyright A

BPM


28

alsoprovideslinksandreferencestoothersourcesofinformationthatarepartofthebroaderBPMCommonBodyofKnowledge.

ThisGuideisalsointendedasaspringboardfordiscussionsamongBPMprofessionals.Often,adisciplinesuchasBPMfindsdifferentgroupsusinglanguageindifferentways,resultinginterminologyorconflictingdefinitionsthatcanconfusediscussionsonthetopic.OnepurposeoftheGuidetotheBPMCBOK®istoencouragetheuseofacommon,agreed‐uponvocabularyfortheBPMdiscipline.

Inaddition,theGuidereflectsthefundamentalknowledgerequiredofaBPMprofessional.AnyassessmentorprofessionalcertificationinthefieldwouldrequireademonstratedunderstandingofthecoreBPMconceptsoutlinedintheknowledgeareas,aswellastheabilitytoperformtheactivitiesandtasksidentifiedwithinthem.ThisGuidetotheBPMCBOK®isthebasisfordevelopingexaminationquestionsfortheexamthatindividualsmustpasstobecomeaCertifiedBusinessProcessProfessional(CBPP®).

1.2 Status and Feedback

AstheCommonBodyofKnowledgeinBPMevolvesandexpandswithadditionalinformationandexperience,sotoowillthisGuidetotheBPMCBOK®.Version2.0waspublishedinEnglish,German,andPortuguese.ReadersofVersion2.0providedvaluablefeedback,whichwastakenintoconsiderationforthedevelopmentofthisversion.ThepurposeofthisthirdreleaseoftheGuideistofurtherdefinethescopeandstructureoftheGuide.Version3.0wasenhancedbyaninternationalcollaborationbetweenABPMPandtheEuropeanAssociationofBusinessProcessManagement.ItwillbepublishedinFrench,Japanese,andArabic,inadditiontothepreviouslanguages.

ThedevelopmentandmanagementoftheGuidetotheBPMCBOK®istheresponsibilityoftheEducationCommitteewithintheABPMP.TheEducationCommitteewelcomesanyfeedbackinordertoimprovetheBPMCBOK®andgaugeitsacceptancebythecommunityofBPMprofessionals.

MembershipsupportandenthusiasmofBPMexpertsarecriticaltothesuccessofthisGuide,thedevelopmentoftheCertificationprocess,andthepromulgationofknowledgeonBPMtopics.TosupportmembershipinvolvementintheevolutionoftheBPMCBOK®,theEducationCommitteehasformedasubcommitteewhichfocusesonthesupportandmaintenanceofthisGuide.

1.3 CBOK® Organization: Summary of Chapters

ThisGuidetotheBPMCBOK®isorganizedinBPMcoreareasorchapters,asoutlinedinFigure1‐1.TheseBPMcoreareasaresegmentedintoabroader,organizational‐orientedperspectiveandaprocessperspective.BPMcoreareasreflectBPMcapabilitiesthatmaybeconsideredbyanorganizationimplementingBusinessProcessManagement.

BPMconceptsarecoveredintheBusinessProcessManagementchapter,whichsetsthestageforalloftheBPMcoreareas.

Copyright A

BPM


29

TheProcessModeling,Analysis,Design,Implementation,PerformanceManagement,andTransformationBPMcoreareascovercriticalBPMactivitiesandskillsets.ManyoftheBPMcoreareasareenabledandsupportedbyBPMTechnologies.PleasenotethatthereisnodedicatedCBOK®chapterforprocessimplementation,sinceIT‐relatedaspectsarecoveredintheBPMTechnologieschapterandorganizationalaspectsarecoveredinthechangemanagementsectionoftheProcessPerformanceTransformationchapter.

ThelargerBPMenvironmentalissuesandhowthepracticeofBPMrelatestootherorganizationaldimensions,suchasgovernanceandstrategicplanning,areaddressedintheProcessManagementOrganizationandEnterpriseProcessManagementchapters.

1.4 Overview of Chapters

Business Process Management (chapter 2)

TheBusinessProcessManagementchapterfocusesontheconceptsofBPM,suchaskeydefinitions,end‐to‐endprocess,customervalue,andthenatureofcross‐functionalwork.Processtypes,processcomponents,theBPMlifecycle,alongwithcriticalskillsandsuccessfactorsareintroducedandexplored.ThischapterdefinesBPMandprovidesthefoundationforexploringtheCoreAreasofBPM.

Process Modeling (chapter 3)

ProcessModelingincludesacriticalsetofskillsandprocessesthatenablepeopletounderstand,communicate,measure,andmanagetheprimarycomponentsof

Figure1.CoreAreasofBPMandCBOKOrganization

Copyright A

BPM


30

businessprocesses.TheProcessModelingCoreAreaprovidesanoverviewoftheseskills,activities,andkeydefinitions,alongwithanunderstandingofthepurposeandbenefitsofprocessmodeling,adiscussionofthetypesandusesofprocessmodels,andthetools,techniques,andmodelingstandards.

Process Analysis (chapter 4)

ProcessAnalysisinvolvesanunderstandingofbusinessprocesses,includingtheefficiencyandeffectivenessofbusinessprocesses.Thischapterexploresprocessanalysispurpose,activitiestosupportprocessdecomposition,andanalyticaltechniquesalongwithroles,scope,businesscontext,rules,andperformancemetrics.Thefocusisonunderstandingcurrent‐stateprocesseswithaviewtoachievingimprovementinthefuturestate.Avarietyofprocessanalysistypes,tools,andtechniquesareincludedwithinthisKnowledgeArea.

Process Design (chapter 5)

Processdesigninvolvescreatingthespecificationsforbusinessprocesseswithinthecontextofbusinessgoalsandprocessperformanceobjectives.Itprovidestheplansandguidelinesforhowworkflows,howrulesareapplied,andhowbusinessapplications,technologyplatforms,dataresources,financial,andoperationalcontrolsinteractwithotherinternalandexternalprocesses.Processdesignistheintentionalandthoughtfulplanningforhowbusinessprocessesfunctionandaremeasured,governed,andmanaged.ThisCoreAreaexploresprocessdesignroles,techniques,andprinciplesofgooddesign,alongwithanexplorationofcommonprocess‐designpatternsandconsiderationssuchascompliance,executiveleadership,andstrategicalignment.

Process Performance Measurement (chapter 6)

Processperformancemeasurementistheformal,plannedmonitoringofprocessexecutionandthetrackingofresultstodeterminetheeffectivenessandefficiencyoftheprocess.Thisinformationisusedtomakedecisionsforimprovingorretiringexistingprocessesand/orintroducingnewprocessesinordertomeetthestrategicobjectivesoftheorganization.Topicscoveredincludeimportanceandbenefitsofperformancemeasurement,keyprocessperformancedefinitions,monitoringandcontrollingoperations,alignmentofbusinessprocessandenterpriseperformance,whattomeasure,measurementmethods,modelingandsimulation,decisionsupportforprocessownersandmanagers,andconsiderationsforsuccess.

Process Transformation (chapter 7)

Processtransformationaddressesprocesschange.Processchangesarediscussedinthecontextofaprocesslifecyclefromplanningtoimplementation.Variousprocessimprovement,redesign,andreengineeringmethodologiesareexplored,alongwiththetasksassociatedwith‘construction,’qualitycontrol,andtheintroductionandevaluationofnewprocesses.Thetopicoforganizationalchangemanagement,whichiscriticaltosuccessfulprocesstransformation,isalsodiscussedhere:itincludesthepsychologicalbackgroundofchangemanagementandsuccessfactorsforchange.

Copyright A

BPM


31

Process Management Organization (chapter 8)

Theprocessmanagementorganizationknowledgeareaaddressestheroles,responsibilities,andreportingstructuretosupportprocess‐drivenorganizations.Adiscussionofwhatdefinesaprocess‐drivenenterprise,alongwithculturalconsiderationsandcross‐functional,team‐basedperformanceisprovided.Theimportanceofbusinessprocessgovernanceisexplored,alongwithavarietyofgovernancestructuresandthenotionofaBPMCenterofExcellence(COE)orCompetencyCenter.

Enterprise Process Management (chapter 9)

Enterpriseprocessmanagementisdrivenbytheneedtomaximizetheresultsofbusinessprocessesconsistentwithwell‐definedbusinessstrategiesandfunctionalgoalsbasedonthesestrategies.Processportfoliomanagementensuresthattheprocessportfoliosupportscorporateorbusiness‐unitstrategiesandprovidesamethodtomanageandevaluateinitiatives.TheEnterpriseProcessManagementKnowledgeAreaidentifiestoolsandmethodstoassessprocessmanagementmaturitylevels,alongwithrequiredBPMpracticeareasthatcanimproveaBPMorganizationstate.SeveralBusinessProcessFrameworksarediscussed,alongwiththenotionofprocessintegration—i.e.,interactionofvariousprocesseswitheachotherandwithmodelsthattieperformance,goals,technologies,people,andcontrols(bothfinancialandoperational)tobusinessstrategyandperformanceobjectives.Thetopicsofprocessarchitectureandbestpracticesinenterpriseprocessmanagementareexplored.

BPM Technology (chapter 10)

BPMisatechnology‐enabledandsupportedmanagementdiscipline.Thischapterdiscussesthewiderangeoftechnologiesavailabletosupporttheplanning,design,analysis,operation,andmonitoringofbusinessprocesses.Thesetechnologiesincludethesetofapplicationpackages,developmenttools,infrastructuretechnologies,anddataandinformationstoresthatprovidesupporttoBPMprofessionalsandworkersinBPM‐relatedactivities.IntegratedBusinessProcessManagementSuites(BPMS),processrepositories,andstand‐alonetoolsformodeling,analysis,design,executionandmonitoringarediscussed.BPMstandards,methodologies,andemergingtrendsarealsocovered.

1.5 Benefits of BPM

TogaincommitmentandmomentumfortheintroductionandfurtherdevelopmentofBPM,thebooksummarizessomeimportantpotentialbenefitsandadvantagesfordifferentstakeholders,particularlyfourimportantgroupsofstakeholderswhomaybenefitdirectlyorindirectlyfromBPM.Thislistshouldnotbereadasaroadmap,butasthetypesofopportunityavailable,dependingonthecompany’smaturityandtheenergyitdecidestogivetheBPMdevelopment.

Copyright A

BPM


32

Benefits of BPM for the

Enterprise Customer Management Actor

Clearownershipforcontinuousimprovement

Improvedprocesseswillpositivelyimpactcustomersatisfaction

Makingsurethatalltheactivitiesrealizedalongaprocessaddvalue

Securityandawarenessforactors

Agileresponsetomeasuredperformance

Mobilizingstaffonstakeholdersexpectations

Optimizingperformanceallalongtheprocess

Betterunderstandingof‘thewholepicture’

Performancemeasurementbenefitscostandquality

Keepingcontroloncommitmentstothecustomer

Improvedplanningandprojections

Clarifyingtherequirementsofaworkplace

Monitoringimprovescompliance

Overcomingtheobstaclesofdepartmentalborders

Definingpreciselytheappropriatesetoftoolsforactors

Visibility,understanding,andchangereadinessimproveagility

Facilitatinginternalandexternalbenchmarkingofoperations

Accesstoinformationsimplifiesprocessimprovement

Organizingalertslevelsincaseofincidentandanalyzingtheimpacts

Assessingprocesscostsfacilitatescostcontrolandreduction

Competence,consistencyand

Copyright A

BPM


33

adequacy

Sustainingtheknowledge

Table1.BenefitsofBPM

1.5.1 Benefits to the Enterprise

Clear ownership and responsibility for continuous improvement

Ifresponsibilitiesforprocessesareclearlyassigned(e.g.toprocessowners),alastingcommitmenttomaintainandpermanentlyimproveprocessescanbeensured.Ifthecustomerdoesnotgetwhattheywantorifinternalgoalsarenotachieved,clear‐cutresponsibilitiesensurequickandwellmapped‐outactions.

Agile response to measured performance

BPMcanfeedday‐to‐dayinformationcontrolsystemsthatmeasureprocessperformance.OrganizationswithrobustBPMcapabilitiescanthenrespondrapidlytodeviationsinmeasuredperformance.

Performance measurement benefits cost and quality

Activemeasurementofprocessperformancereinforcesandbenefitscostcontrolandquality.Withoutperformancemeasurement,organizationswillnothavethecapabilitytoachieveoptimalperformance.

Monitoring improves compliance

Mostorganizationsfaceinternalorexternalcomplianceriskthroughinactionorimproperresponsetoevents.Monitoringprocessexecutionagainstcompliancerequirementscangreatlymitigatesuchrisks.Automatedmonitoringcoupledwithqualitymanagementandclearproceduresandauthoritiescanfurthermitigatecompliancerisk,whileatthesametimereducingcompliancecostandimprovingoverallquality.

Visibility, understanding, and change readiness improves agility

Withoutprocessmanagement,organizationsbecomeboggeddownintheunknowns,andcanbeblindsidedbyunaccountedinternalorexternalchanges.Organizationsthatdocument,manage,andmeasuretheirprocessesarepreparedforcontinuousimprovementandarebetterpositionedtorecognizeandstayaheadofchallenges.

Access to useful information simplifies process improvement

Havingimmediateaccesstoprocessrepositoriesandbestpracticesfacilitatesandacceleratestheimprovementofprocessesortheeffectivereactiontoenvironmentchangesandnewrulesandregulations.

Copyright A

BPM


34

Assessing costs of processes facilitates cost control and reduction

Knowingalltheactivitiesinaprocessfacilitatesassessingdirectcostsofprocessesandidentifyingthemosteffectivewaystoreducethem.Additionallythishelpstobetterpricedeliveredproductsandservices.

Competence consistency and adequacy

Knowingalltheactivitiesexecutedinanorganizationenablescompetenceconsistency,standardization,andadequacy.Thisisalsoafoundationforassessingandmanagingcoreandcompetitivecapabilities.

Documenting operations and sustaining the knowledge

Theknowledgeofactivitiesandtasksperformedbyeachentityofanorganizationisthebasisfordescribingprocedures(howthebusinessisrun).Thissetofdocumentsprovidesarepositoryofknowledgeusefultoensureitssustainabilityallaroundthecompany.Itisanimportantpartoftheknowledgemanagementofanorganization.

1.5.2 Benefits to Customers

Improved processes will positively impact customer satisfaction

Theimprovementofprocesseshelpstomeettimeexpectations,increasethequalityofproductsandservices,andopensthepossibilitytoreducepricesthroughcostreduction.Allthisleadstohighercustomersatisfaction.

Mobilizing staff on stakeholders’ expectations

Aprocessisdesignedtomeetstakeholderrequirements.Ithighlightsalltheactorswhocontributetostakeholdersatisfactionandallowseachofthemtorecognizethepurposeoftheirwork,givingsensetotheworktheydo.

Keeping control on commitments to the customer

Steeringtheprocessesgivescontroltoindividualstoregularlymeasureperformanceand,ifnecessary,tocorrectexcessesineachpartofthebusiness.Thisallowsindividualstofocusonthecustomer’sbenefit.

1.5.3 Benefits to Management

Making sure that all the activities realized along a process add value

Aprocesscontainsasetofactivitiesthatsucceedoneanotherandarelinked.Everyactivitymadehastobringanaddedvaluetotheprocess.Theidentificationofthevariousactivitiesenablesquestionsabouttheirvalue,andifvaluecannotbefound,itisadvisabletodeletethem.

Optimizing performance all along the process

Theprocessdesignhelpsstafftolearnandmasterallofthenecessarycontributions.Ithelpsfocusperformanceanalysesoneachcontributorandfindsspecificorganizationalandtechnologicalwaystoimprovetheprocess.Intheend,changeswillreducetimeandcost,whileimprovingquality.

Copyright A

BPM


35

Improved planning and projections

Visibleandmeasureableprocessesaugmenttraditionalsourcesofplanningdata.Leadershipcantakeorganizationalperformanceandchangeplansintoaccountinmediumandlong‐termplanning.

Overcoming the obstacles of departmental borders

Manycompaniesarestructuredaccordingtoverticalsiloswhereeachbranchoptimizesitsownactivities.Aprocess‐basedapproachhighlightstheoperationallinkagesbetweendepartments,necessarytoeffectivelysatisfyeveryrequest.Aprocessviewhelpsanorganizationfocusoninteractionsandhandoffsthatwillallowittoimproveitsoverallprocessesandeffectiveness.

Facilitating internal and external benchmarking of operations

Aprocessapproachbasedonactivitiesandnotonorganizationstructuresenablesthecomparisonofdifferentwaystoachieveacommonobjective.Inaddition,KeyPerformanceIndicators(KPIs)attachedtotheprocessmakeiteasiertocomparetherelativeperformanceofdifferentsolutions.Theseinternalorexternalassessmentsfacilitatetochoosethebestpractices.

Organizing alerts levels in case of incident and analyzing the impacts

Theprocessownerisinchargeoftheday‐to‐dayexecutionoftheirprocesses.Withinvariousprocessteams,theprocessownermustdevelopwaysandmeansforearlydetectionofdysfunctionsthatemergeandensureorganizedandfocusedwaystocommunicatewithothers,dependingonthenatureofthesituation.

1.5.4 Benefits to Actors

Security and awareness for actors

Knowingtheimportanceofanindividual’scontributionsandperformanceaccordingtogoalsandindicatorscreatesawarenessoftheworkperformed,clarifiestheimportanceofeachposition,andhelpstobuildtheimportanceofthecustomer’sexperience.

Better understanding of ‘the whole picture’

Documentedandwell‐understoodprocessespromoteawarenessoftheinterdependenceamongactivities,andthereforetheimportanceofcomplianceasakeysuccessfactorfortheoverallbusinesssuccess.Designingprocessesrequiresanalyzingexistingpracticesandofferstheopportunitytoidentifyanygapsinthebusinessdocumentation(non‐describedoroutdatedprocedures,etc.).

Clarifying the requirements of a workplace

Theknowledgeoftheworkperformedprovidestheabilitytodesigntrainingmodulesadjustedtotheneedsoftheworkplace.

Defining precisely the appropriate set of tools for actors

Knowingprocessesindetailshelpaccuratelyidentifyallthenecessaryresourcesconsistentinquantitative(workload)andqualitative(skills)terms.Itoptimizestheworkplaceanditsdocumentation.

Copyright A

BPM


36

1.6 BPM Overview

BPMprovidesameanstofocusonresultsaswellascourseofaction.Figure2illustratesthreebroadapplicationsforBPM.

Figure2.ViewsofBPM

Initiativescanbelimitedinscope,suchasaprojectthatistargetedonBusinessProcessImprovement(BPI).ThiscanbeachievedbytheapplicationoftheBPMLifecycleasdescribedinthisGuideorbyapplyingothermethodologieslikeLeanManagementorSixSigma.

BusinessProcessImprovement(BPI)isasingularinitiativeorprojecttoimprovethealignmentandperformanceofaparticularprocesswiththeorganizationalstrategyandcustomerexpectations.BPIincludestheselection,analysis,design,andimplementationofthe(improved)process.

BPMcanalsomeanaholisticsystemastheoutcomeofinitiativesorprojects.Thisresult,calledEnterpriseProcessManagement(EPM),includesthestrategy,valuesandculture,structuresandroles,andawholesetofend‐to‐endprocesseswiththeirassociatedgoalsandindicators,IT,andpeople.ThedegreeofprogressreachedcanbeassessedasProcessManagementMaturityLevel.

Copyright A

BPM


37

EnterpriseProcessManagement(EPM)istheapplicationofBPMprinciples,methods,andprocessestoanindividualenterprise.EPM(a)assuresthealignmentoftheportfolioandarchitectureofend‐to‐endprocesseswiththeorganization’sstrategyandresourcesand(b)providesagovernancemodelforthemanagementandevaluationofBPMinitiatives.

BPMcanalsobeseenasaContinuousRefinement,whichcanbeachievedbytheapplicationofaday‐to‐dayfeedbackcontrolsystemtopermanentlyimprovethequalityofsingleprocessesandtheEnterpriseProcessManagementSystem.

BusinessProcessContinuousRefinementisthesustainedapproachtomakespecifiedprocessesmoreefficientandeffectivebyapplyingaconcurrentandresponsivefeedbackcontrolsystem.

Literature References

BPMG.(2005)“InSearchofBPMExcellence:StraightfromtheThoughtLeaders”Meghan‐KifferPress.

Champlin,B.(2006)“BusinessProcessManagementProfessionals,”BPMStrategies,October2006;Burlton,R.T.(2001)“BusinessProcessManagement:ProfitingfromProcess.”Sams

Morris,DanielandBrandon,Joel,(1994)“ReengineeringYourBusiness,”McGraw‐HillBookCompany

Davenport,T.(1993)“ProcessInnovation:ReengineeringWorkThroughInformationTechnology.”HarvardBusinessSchoolPress

DephiGroup,(2003)“BPM2003MarketMilestoneReport,”aDelphiGroupWhitepaper,

Dwyer,T.,(2004)“BPMInstitute’sStateofBusinessProcessManagement.”ExecutiveWhitePaper,.www.BPMInstitute.org

Hammer,M.;J.Champy(2003)“BusinessReengineering.”DieRadikalkurfürdasUnternehmen.7.Aufl.,CampusVerlag,G.(2009)‘PraxishandbuchProzessmanagement.8.Aufl.,VerlagDr.GötzSchmidt

Harmon,P.(2004).“EvaluatinganOrganization’sBusinessProcessMaturity,”BusinessProcessTrends,March2004,Vol.2,No.3,

IIBAInternationalInstituteofBusinessAnalysis(Ed.),(2009)“AGuidetotheBusinessAnalysisBodyofKnowledge”

Copyright A

BPM


38

Mahal,A.(2010)BusinessProcessManagement,“BasicsandBeyond:HowWorkGetsDone”TechnicsPublicationspp.1‐11,

Osterloh,M;J.Frost,(2003)ProzessmanagementalsKernkompetenz—WieSieBusinessReengineeringstrategischnutzenkönnen4.Aufl.Gablerhttp://www.caciasl.com/pdf/BPtrendLevelEval1to5.pdf

Parker,B.G.(1995)“DataManagementMaturityModel,”MITRESoftwareEngineeringCenter,McLean

Porter,M.(1985),“CompetitiveAdvantage,”NewYork:FreePress.

Rosemann,M.;T.deBruin.(2005)“ApplicationofaHolisticModelforDeterminingBPmaturity,”BusinessProcessTrends.

Rummler,G.A.(2004)“SeriousPerformanceConsulting:AccordingtoRummler.”ISPIandASTD

Rummler‐BracheGroup(2004)“BusinessProcessManagementinU.S.FirmsToday”AstudycommissionedbyRummler‐BracheGroup.

Rummler,G.A.;A.J.Ramias;R.A.Rummler(2010).“WhiteSpaceRevisited:CreatingValueThroughProcess”Jossey‐Bass

RyanK.;L.Ko(2009)“Acomputerscientist’sintroductoryguidetobusinessprocessmanagement”(BPM),ACMPress

Scheer,A.W.;F.Abolhassan,et.al.(Editors)(2004)“BusinessProcessAutomation”Springer‐Verlag.

Sinur,J.(2004).“LeveragingtheThreePhasesofProcessEvolution.”ProcessWorld2004,Gartner,Inc.Presentation

Spanyi,A.(2006),“MoreforLess:ThePowerofProcessManagement.”Meghan‐KifferPress

zurMuehlen,M.(2004).“Workflow‐basedProcessControlling.Foundation,Design,andApplicationofworkflow‐drivenProcessInformationSystems.”Logos

vomBrocke,J.;M.Rosemann(2010).“HandbookonBusinessProcessManagement:StrategicAlignment,Governance,PeopleandCulture.”Springer.

Copyright A

BPM

P InternationalChapter 2

Business Process Management

Copyright A

BPM

P InternationalChapter2.BusinessProcessManagement

40

Foreword by Janelle Hill, VP Gartner, Inc.

Gartner’s Vision for Business Process Management

Duringthepast100years,breakthroughsinprocessmanagementhavebeenfundamentaltotheprogressofcorporations,industries,andeconomies.ProcessandqualitydisciplinetransformedJapan'sfortunesinthedecadesafterWorldWarII,whichshowstheeconomicmusclethatbetterprocessmanagementcandeliver.

In2011,weareatthebeginningofanothererainprocessthinking—aperiodthat,inGartner’sview,willbedistinguishedbyoperationallyresilientprocesses,notjuststandardizedandefficientprocesses.InGartner’sview“operationalexcellence”shouldnolongersimplybemeasuredbyinward‐looking,efficiency‐orientedmetrics.Instead,keytenetsofBPMemphasizeprocessvisibility,accountability,andadaptabilityinordertocontinuallyoptimizeresultsandbettermeetthechallengesofagloballydiversebusinessenvironment.

Tomeetthesechallenges,enterprisesneedtoimprovetheirabilitytoanticipateandrespondtoshiftingmarketandcustomerdemands.Businesseswanttheiroperationstobecomemoreresilient,especiallygiventhefrequencyofdisruptiveeventsinaglobaleconomy.Yet,despite‘businessagility’havingbeenthemantraofBPMforthelast10years,feworganizationshaveactuallyachievedthisgoal.AlthoughleadersinBPMaredeliveringmorefrequentchangestotheirprocessesandhavefosteredacultureofcontinuousprocessimprovement,theirprocessesarestillnotdesignedforchange.Implementingchangecontinuestobedifficult,oftenrequiringdeeptechnicalskills.Moretypically,ITdeliverycyclesratherthanthepaceofbusinessstillcontrolprocessadaptability.

Therearemanyreasonsforthislackofachievement.Onefactoristhatfeworganizationshaveyetidentifiedthoseprocessesthattrulyneedtobecomemoreagile.Fewbusinessleadershaveaskedthemselvesquestionssuchas:

Whatarethesignalsinourworkthatwouldindicatethatoperationalchangemightbeneeded?Andhowcanwemonitortheenvironmentforthosesignals?

Whatevents(internallyandexternallytriggered)woulddriveustochangehowworkisdone?

Whataspectsofworkspecificallyneedtochangeandhowoften? Whoshoulddecidethatchangeisappropriateandwhatspecificchangeis

needed? Howcanwecommunicatethedesiredchangeandensurethatitis

implemented? Howcanweknowifthechangeachievesthedesiredoutcome?Andifit

doesn’t,couldweundothechangeeasily?

Furthermore,ourresearchfindsthatmostorganizationscontinuetofocusonsmallimprovementstostructuredprocesses,whenthebiggeropportunityforprocessdifferentiationisinknowledge‐intensivework.Workperformedbyknowledge

Copyright A

BPM


41

workersislargelyunstructured:itisnon‐routineandnotperformedinapredictable,sequentialfashion.

Knowledgeworkinvolvesresearch,analysis,highlevelsofexpertiseandjudgment,collaboration,riskassessment,andcreativity,inadditiontoinvestigative,negotiating,andcommunicationskillsandmore.Thecharacteristicsofknowledgeworkhavelargelyprecludeditfromthebenefitsofsoftwareautomationfordecades.Thiscan’tcontinue.Why?Becauseleadingeconomiesaroundtheworlddependonknowledgeworkersuccess.Theworld’sleadingeconomiesareallservices‐based—notagricultural‐orindustrial‐basedanymore.Services‐basedindustriesdependonharnessingknowledge.Therefore,organizationsshouldstarttoapplyprocessmanagementtechniquestobettersupportandcoordinatethesemoreunstructuredworkdomains.

Yettheexposureishighbecauseknowledgeworkisinherentlycomplexandwillchallengetraditionalprocessthinking.ApplyingBPMtoknowledge‐centricdomainsdoesnotmeanforcingstructureandroutineontotheseareas.Instead,advancedBPM‐enablingtechnologieslikeexplicitmodels,real‐timedatafeeds,virtualization,socialmedia,andstatisticalanalysiscanbeincorporatedtocoordinate(notautomate)resourceinteractions,toprioritizework,andmaketheprocessandindividualworkeffortstransparent.ByincorporatingmodernBPMtechniques(suchasempoweringthoseclosesttothecustomerexperienceofthework)andtechnologies,businessescanbecomemoreresponsivetoshiftingmarketdemands.BPMisincreasinglyaboutfosteringeffectiveworkhabits,notjuststandardizingprocessestoincreaseefficiencies.

ImplementingBPMisdifficult.Themainbarrierstoanysignificantchangearethehumanones:inertiaandvestedinterests.Andknowledgeworkersareamongthemostresistanttoprocessimprovement.Theyseeitasdiminishingtheirexpertiseanduniqueinsight.However,eventhisattitudereflectslong‐heldmisperceptionsofprocessimprovement.Processimprovementdoesnotalwaysmeanmakingallworkroutine.AlotofBPMeffortisaboutmanagingtheaggregateperformanceoutcomeoftheend‐to‐endprocess,notjustincreasingcontrolsovertheindividualactivitiesandtasks.Toachieveoperationalresilience,thecultureandattitudesoftheorganizationmustalsochange.TheshiftinmanagementpracticesforBPMwillnotcomeeasilybutcanhavefar‐reachingconsequences.

BPMisajourney,notadestination.TheadoptionofBPMwillstrengthencompetitiveadvantageinwell‐positionedcompanies.BPM‐centriccompanieswillenjoyincreasedalignmentbetweenoperationsandstrategy,greateroperationalresilience,less‐intrusivecomplianceandofcourse,increasedefficiencies.Beginyourjourneytoday!

Copyright A

BPM


42

Contents

ForewordbyJanelleHill,VPGartner,Inc................................................................................40

2.0 Introduction.............................................................................................................................43

2.1 WhatisBusinessProcessManagement?.....................................................................43

2.2 BPMCoreConcepts...............................................................................................................44

2.2.1BusinessProcessManagementisaManagementDiscipline..........................44

2.2.2Successfullyimplemented,BusinessProcessManagementisaCoreInternalCapability........................................................................................................................44

2.2.3BusinessProcessManagementaddressesthedeliveryofvaluetocustomer............................................................................................................................................45

2.2.4BusinessProcessManagementaddressesend‐to‐endworkandtheorchestrationofactivitiesacrossbusinessfunctions....................................................48

2.2.5BusinessProcessManagementaddressesWhat,Where,When,WhyandHowworkisdone,andWhoisresponsibleforperformingit...................................49

2.2.6ThemeansbywhichbusinessprocessesaredefinedandrepresentedshouldbeFitforPurposeandFitforUse...........................................................................51

2.2.7BusinessProcessesshouldbemanagedinaclosed‐loopcycletomaintainprocessintegrityandenablecontinuousimprovement..............................................53

2.2.8CoordinatedandProactiveManagementofBusinessProcessesrequiressignificantinvestmentininternalbusinesscapabilitydevelopment.....................59

2.2.9 Internalcapabilitiesrequiredtosupportenterprise‐wideBusinessProcessManagementaredevelopedalongaProcessMaturityCurve...................63

2.2.10ABusinessProcessManagementimplementationrequirestheintroductionofnewrolesintotheorganization..............................................................72

2.2.11BusinessProcessManagementisnotaprescribedframework,methodology,orsetoftools.....................................................................................................79

2.2.12Technologyplaysasupportingrole,notaleadingrole,inaBusinessProcessManagementimplementation.................................................................................80

2.2.13 ImplementationofBusinessProcessManagementisaStrategicDecisionandrequiresstrongexecutivesponsorship......................................................................81

Copyright A

BPM


43

2.0 Introduction

ThischapterintroducesgeneralBusinessProcessManagementdefinitionsandconcepts,whichprovideanessentialfoundationforexploringtheremainderoftheBPMCBOK.

2.1 What is Business Process Management?

Bydefinition,BusinessProcessManagementisamanagementdisciplinethattreatsbusinessprocessesasassets.Itpresumesthatorganizationalobjectivescanbeachievedthroughthedefinition,engineering,controlanddedicationtocontinuousimprovementofbusinessprocesses.

WhilethisdefinitionofBusinessProcessManagementisagoodstart,totrulyunderstandwhatBPMis,itmustbelookedatfromanumberofperspectives.FollowingisanintroductiontoseveralBPMCoreConcepts,whichwillbeelaboratedthroughouttheremainderoftheCBOK.Thesecoreconceptsare:

BusinessProcessManagementisaManagementDiscipline Successfullyimplemented,BusinessProcessManagementisaCoreInternal

Capability BusinessProcessManagementaddressesthedeliveryofvaluetocustomer BusinessProcessManagementaddressesend‐to‐endworkandtheorchestration

ofactivitiesacrossbusinessfunctions BusinessProcessManagementaddressesWhat,Where,When,WhyandHow

workisdoneandWhoisresponsibleforperformingit Themeansbywhichbusinessprocessesaredefinedandrepresentedshouldbe

FitForPurposeandFitForUse BusinessProcessesshouldbemanagedinaclosed‐loopcycletomaintain

processintegrityandenablecontinuousimprovement Coordinatedandproactivemanagementofbusinessprocessesrequires

significantinvestmentininternalbusinesscapabilitydevelopment Internalcapabilitiesrequiredtosupportenterprise‐wideBusinessProcess

ManagementaredevelopedalongaProcessMaturityCurve ABusinessProcessManagementimplementationrequirestheintroductionof

newrolesintotheorganization BusinessProcessManagementisnotaprescribedframework,methodology,or

setoftools Technologyplaysasupportingrole,notaleadingroleinaBusinessProcess

Managementimplementation TheImplementationofBusinessProcessManagementisaStrategicDecisionand

requiresstrongexecutivesponsorshipforsuccessfulimplementation

Copyright A

BPM


44

2.2 BPM Core Concepts

2.2.1 Business Process Management is a Management Discipline

Theword“Management”tracestotheFrenchwordménagement,“theartofconducting,directing,”andtotheLatinwordmanuagere,“toleadbythehand.”Itdescribestheactofleadingallorpartofanorganizationthroughthedeploymentofhuman,financial,material,andintellectualresourcestowardfulfillmentofstatedobjectives,specificallythemaximizationofvaluetocustomerandtherebyareturnoninvestmenttoshareholders.

A“Discipline”isabodyofknowledgethataddressescommonlyacceptedprinciplesandpracticesinaspecificsubjectarea.

A“ManagementDiscipline”thereforeisabodyofknowledgethataddressestheprinciplesandpracticesofbusinessadministration.Itspecifiestheprinciplesandpracticesthatdirectthemanagementofbusinessresourcestowardstatedobjectives.

BusinessProcessManagementisaManagementDisciplinewhichassumesthatorganizationalobjectivescanbestbeachievedthroughfocusedmanagementoftheorganization’sbusinessprocesses.Definedinthiscontext,BusinessProcessManagementisabodyofknowledgeusedtoestablishprinciplesandpracticestodirectthemanagementofresourcesunderthisassumption.

TherelevanceofintroducingBusinessProcessManagementasamanagementdisciplineisthreefold:

BusinessProcessManagementisnotaprescribedmethodologyandtoolkitconsumedwhollybyanorganization,butinsteadaBodyofKnowledgeconsistingofprinciplesandbestpracticestoguideanorganizationinthedevelopmentoftheseelements

TheBodyofKnowledgecanbeappliedtoanyorganization,whetherafor‐profit,non‐profitorgovernmententity,forthepurposeofdirectingbusinessresourcestowardstrategicobjectives

Effectivemanagementofbusinessprocessesrequiresparticipationfromtheentireorganization,fromexecutivemanagementthroughoperationalstaffandacrossallfunctionsandroles.Successfullyimplemented,BusinessProcessManagementbecomesengrainedinthecultureanddefinesthewaybusinessisconducted.

2.2.2 Successfully implemented, Business Process Management is a Core Internal Capability

ImplicitinthedefinitionofBusinessProcessManagementasaManagementDisciplineistheassumptionthatorganizationsthathavesuccessfullyimplementedit“havetheabilityto”effectivelymanagetheirbusinessprocesses.Inotherwords,theyhavedevelopedaBusinessProcessManagementcapability.

Copyright A

BPM


45

Acapabilityinthiscontextisacollectionofprocesses,people,andtechnologiesthattogetherprovidevaluetowardtheachievementofstrategicobjectives.

To“havetheabilityto”effectivelymanagebusinessprocesses(tohaveaBusinessProcessManagementcapability),anorganizationmustpossesstheprocesses,people,andtechnologiestodoso.Toputitanotherway,anauditofanorganization’sBusinessProcessManagementcapabilityshoulduncover:

1. Businessprocesseswhichthemselvessupportthemanagementofbusinessprocesses.Forexample,anorganizationshouldhaveprocessesthatenable:

Thedefinitionanddesignofbusinessprocesses Thebuildanddeploymentofbusinessprocesses Themonitoringandcontrolofbusinessprocessexecution Thecontinuousimprovementofbusinessprocessesovertime,inspite

ofandinresponsetointernalandexternalchange.

2. Specificroles(people)thatareengagedinthemanagementofbusinessprocesses.Thesemightinclude,butarenotlimitedto:

ProcessArchitectsresponsibleforbusinessprocessdefinitionanddesign

ProcessAnalystsresponsibleforbuild,deployment,monitoringandoptimizationofbusinessprocesses

ProcessOwnersresponsiblefortheend‐to‐endexecutionofbusinessprocessesagainstdefinedperformanceexpectationsandultimatelythedeliveryofvaluetocustomer.

3. Specializedtechnologiesdeployedtosupportthemanagementofbusinessprocesses.Thesetechnologiesprovidefunctionalityto:

Definebusinessprocessesinthecontextofoverarchingenterprisearchitecture

Designbusinessprocessesfordeployment Executebusinessprocessesinoperations Monitorbusinessprocessesagainstperformanceexpectations Analyzebusinessprocessestoidentifyandvalidateimprovement

opportunities Manageandcontrolbusinessprocesschange.

2.2.3 Business Process Management addresses the delivery of value to customer

ThepremiseofBusinessProcessManagementisthatorganizationalobjectivescanbeachievedthroughfocusedmanagementofbusinessprocesses.Regardlessofwhetheranorganizationisfor‐profit,not‐for‐profit,oragovernmententity,anorganization’sprimarypurposeistodelivervaluetocustomerintheformof

Copyright A

BPM


46

productsandservices.Thispurposeiswhatallorganizationalobjectivesshouldtraceto.

CommoninMBAprogramsistheprinciplethatafor‐profitorganization’sprimarypurposeistodeliverareturnonshareholderinvestment.Thissimplywillnothappen(atleastnotforlong)ifcustomersdonotperceivevaluefromtheorganization’sproductand/orserviceofferings.Soagain,theprimarypurposeofanorganizationistodelivervaluetocustomerintheformofproductsandservices;shareholdervalueisdrivenfromthere.

Simplydefined,abusinessprocessisasetofactivitiesthattransformoneormoreinputsintoaspecificoutput(productorservice)ofvaluetoacustomer;andsoitfollowsthatorganizationalobjectivescanbeachievedthroughfocusedmanagementofbusinessprocesses.

Figure3.

TosomewhoarefirstintroducedtoBusinessProcessManagement,ortothosewhomaynothaveacompleteunderstandingofit,thestatement“organizationalobjectivescanbeachievedthroughfocusedmanagementofbusinessprocesses”canseembold.Butwhenthestatementisthoroughlydecomposedandanalyzed,thelogictracks:

Organizationsexisttodelivervaluetocustomersintermsofproductsorservices

Allorganizationalobjectivesshouldthereforetracetodeliveryofvaluetocustomer

Businessprocessesarethevehiclesbywhichproductsandservicesarecreatedanddeliveredtocustomer

BusinessProcessManagementestablishesthemeansbywhichbusinessprocessesaremanaged

ThereforeBusinessProcessManagementisameansforachievingorganizationalobjectives.

Importantinthisdiscussionofcustomerisanunderstandingthat“Customer”isentirelydependentuponthebusinesscontextunderanalysis.Clearly,theconceptofcustomerexternaltotheenterpriseiswellrecognized.Forexample,

Copyright A

BPM


47

Thecustomersofatiremanufacturerarecarmanufacturersandpeoplewhodrivecars.

Thecustomersofafinancialservicesproviderareindividualsandbusinessentitieswhosaveandinvestmoney.

Figure4.

Lessobviousistheconceptofcustomerbetweenfunctionswithinanenterprise.InFigure4,engines,transmissions,andchassisareengineeredinDesign,madebyManufacturingandputtogetherbyAssembly.

Ifacontextboundaryweredrawnaroundthemanufacturingorganization,and,forthesakeofanalysis,ifthemanufacturingorganizationwereimaginedasanindependentorganizationalentity,thecustomeroftheManufacturingOrganizationisAssemblyandtheproductsdeliveredareEngines,Chassis,andTransmissions.TheSupplieroftheManufacturingOrganizationisDesign,andthevalueprovidedisintheformofDesignSpecifications.

Inanotherexample,theInformationSystemsorganizationwithinaPharmaceuticalcompanyprovidesservicestotheotherlinesofbusiness.EachoftheseservicesisdeliveredtothelinesofbusinessthroughbusinessprocessesexecutedbyInformationTechnology.ThisServiceProvider/Customerrelationshipisillustratedbelow.

Figure5

Copyright A

BPM


48

Figure6.Serviceprovider/Customerrelationship

ThekeytakeawayintheseexamplesandakeyconceptinBusinessProcessManagementisthatbusinessprocessesdelivervaluetocustomerintheformofproductsandservices.BusinessProcessManagementisaboutoptimizingthemeansbywhichthisvalueisdelivered.

Organizationssuccessfulinbusinessprocessmanagementinstillandfosteracultureofcustomerfocusattheenterpriselevel,thefunctionallevel,anddownthroughtherolelevel.

2.2.4 Business Process Management addresses end‐to‐end work and the orchestration of activities across business functions

ABusinessFunctionisaclassificationofworkthatisdonebyanorganizationbaseduponaparticularskillorprofessionalexpertise.Forexample,sales,finance,manufacturing,supplychain,andcustomerrelationshipmanagementareallclassicbusinessfunctions.Inthiscontext,abusinessfunctioncanbethoughtofasa“centerofexcellence”—agroupingofpeopleandtoolsspecializedinaspecificprofession,discipline,orareaofexpertise.

ConsideringthataBusinessProcessisasetofactivitiesthattransformoneormoreinputsintoanoutput(productorservice)ofvaluetoacustomer,itstandstoreasonthatmostcomplexproductsandserviceswillrequirecontributionfrommultiplebusinessfunctions.

Copyright A

BPM


49

Figure7.

Thediagramaboveillustrates

ActivitiesperformedbyBusinessFunctionscontainingspecializedexpertise SequencesofactivitiesorchestratedacrossmultipleBusinessFunctionsand

constitutingaBusinessProcess.

Theend‐to‐endmanagementofBusinessProcessesandthecontrolledorchestrationofactivitiesacrossmultipleBusinessFunctionsistheessenceofBusinessProcessManagementandwhatdifferentiatesitfromtraditionalFunctionalManagement.Intoday’scomplexorganizations,BusinessProcessManagementandFunctionalManagementdisciplinesmustcohabitandworktogetherfortheorganizationtoremaincompetitivelyviable.

FunctionalManagementensuresexecutionofthemyriadfunctionaldisciplinesrequiredtoproducetheorganization’sproductsandservices.

BusinessProcessManagementensuresworkiscoordinatedacrossthesemyriadfunctionsinordertodeliverproductsandservicesinthemosteffectiveandefficientmannerpossible.

2.2.5 Business Process Management addresses What, Where, When, Why and How work is done, and Who is responsible for performing it

Inmanyorganizations,businessprocessesvisibilityandunderstandingareoftenfacilitatedbygraphicalrepresentationsofactivitiesinboxesstrungtogetherinswimlanes,asinthediagrambelow.

Copyright A

BPM


50

Figure8.

Steppingbacktoexaminewhatinformationiscommunicatedinthisdiagram,wediscoveritsimplyrepresents“WhodoesWhatwork.”Whilethisinformationmightbeextremelyhelpful,italsomightleaveanumberofunansweredquestions,suchas:

Whenistheworkdone? Whatmaterialorinformationalinputsarerequired? Whatdeliverablesandartifactsareproduced? Whereistheworkdone? Wherearetheworkdeliverablesandartifactsstored? Whyistheworkdone? Whobenefitsfromthefinaloutput?

AcomprehensivelydefinedbusinessprocesswilladdressWhat,Where,When,WhyandHowworkisdone,andWhoisresponsibleforperformingit.Awell‐structuredprocessdefinitionwillprovidetherightamountofvisibilityanddetailtothevariousconsumersofthisinformation,potentiallyacrossalllevelsoftheorganization.Whileswimlanediagramsliketheoneaboveareoftencriticalcomponentsofacompletebusinessprocessdefinition,numerousotherrepresentationsneedtobeincludedinthefullpackage.

Asmallsampleofartifactsoftencreatedandmaintainedincludesthosethatrepresent

Businesscontext,includingtheinternalcapabilitiestheprocesssupportsandhowthebusinessprocesscontributestothedeliveryofproductsorservicestoanexternalcustomer

Copyright A

BPM


51

Processcontext,includingsuppliersandinputs,outputandcustomers,triggeringandresultingevents,processcontrols,enablingresources,andperformancetargets

Businesstransactionsdetailingthepassageofworkproductsbetweenfunctionsandroleswithinanorganizationandbetweentheorganizationandsuppliersandcustomers

Statetransitionsdetailingthevariousstagesofworkproductdevelopmentastheyprogressandaretransformedthroughtheprocess

Businesseventscreatedbothinternalandexternaltotheprocess,andhowtheseeventstriggerthevariousactivitiesandgatewaysthatmakeuptheprocess

Processdecomposition,illustratinghowabusinessprocessisbrokendownintosmallerandsmallerunitsofworkfromthehighest‐levelidentificationtothelowest‐levelproceduraltask

Performanceexpectationsdetailingthecommitmenttothecustomerwithrespecttoproductorservicedeliveryandthevariousperformanceindicatorsestablishedandmeasuredthroughouttheprocesstoensurethesecommitmentsaremet

Organizationalstructureanddepictionsofhowthevariousfunctionsandroleswithinanorganizationareassembledtosupportprocessexecution

Informationsystemfunctionalityandhowthatfunctionalityisleveragedtosupportprocessexecution.

Thekeytakeawayisthatcomprehensivemanagementofanend‐to‐endbusinessprocessrequiresacomprehensiveunderstandingofthebusinessprocess.ThisunderstandingmustextendwellbeyondHowworkisdone:itmustalsoaddressWhatworkisdone,When,Where,Why,andbyWhom.ABusinessProcessManagementdisciplinemustaccommodatethemeansbywhichthiscomprehensiveunderstandingisfacilitated.

2.2.6 The means by which business processes are defined and represented should be Fit for Purpose and Fit for Use

Clearly,thedevelopmentandmaintenanceofabusinessprocessdefinitionthatcananswereveryconceivablequestionaboutWho,What,Where,When,Why,andHowworkisdoneforeverypotentialrolewithinanorganizationwouldrequireasignificantinvestmentintimeandresources.Ifpossibleatall,thecostofdevelopingandmaintainingsuchamodelwouldlikelyfarexceedthevaluederivedfromthiseffort.

Whileeveryrepresentationdescribedinthesectionaboveisgenericallyvalid,itisincumbentupontheperson(s)responsiblefordevelopingandmaintainingtheprocessdefinitiontounderstandwhichrepresentationsarerequiredtomeetbusinessneed.Inotherwords,itisprudenttounderstandwhatpurposetheprocessdefinitionwillserve,andfocusonbuildingandmaintainingonlytherepresentationsthatsupportthispurpose.

Copyright A

BPM


52

Forexample,considerthefollowingbusinessneedsaprocessdefinitionmightsupportandthedifferentmixofprocessrepresentationsrequiredtosupporteachneed:

TheExecutiveLeadershipteamreliesuponbusinessprocessdefinitionstosupportvaluechainanalysis,culminatingintheestablishmentofnewandmodifiedstrategicobjectives.

TheBusinessContinuityandDisasterRecoveryteamreliesuponbusinessprocessdefinitionstounderstandthecriticalcapabilities,processesandunderlyingfunctionsthatmustberestoredtomaintaincommercialviabilityafteracatastrophicevent.

TheCorporateComplianceteamreliesuponbusinessprocessdefinitionstoensuretheorganizationisincompliancewithexternalregulationsandtounderstandwhatspecificprocessesandprocedureswouldneedtobeexaminedintheeventofregulationchange.

TheChiefTechnologyOfficerreliesuponbusinessprocessdefinitionstosupportthedevelopmentandmaintenanceoftheenterprisetechnologyroadmap.

AFunctionalManagerreliesuponbusinessprocessdefinitionstoensurecompletecoverageofonboarding,training,andjobsupportmaterialforheroperationsstaff.

ABusinessAnalysisteamreliesuponbusinessprocessdefinitionstoidentifyinstanceswheretechnologyinvestmentwillprovideapositivereturnoninvestment.

AnInformationTechnologyDevelopmentteamreliesuponbusinessprocessdefinitiontounderstandhowinformationsystemsrequirementsanddesignsupportbusinessfunction.

AWorkflowApplicationreliesuponabusinessprocessdefinitiontoautomaticallyorchestrateactivitiesacrossoperationsstaffandotherfunctionalapplicationsinaproductionenvironment.

Whileeachoftheabovebusinessneedsissupportedbytheexistenceofbusinessprocessdefinitions,ineachcircumstance,theinformationneedsandmostsuitablerepresentationsofthisinformationaredifferent.Thekeytakeawayisthataprocessdefinitionshouldbefitforpurposeandfitforuse:

FitforpurposeimpliesthattheprocessdefinitioncontainsallnecessaryinformationtoanswertheWho,What,Where,When,Why,andHowquestionsitisintendedtoaddress.

Fitforuseimpliesthattheprocessdefinitionisstructuredtorepresentthisinformationinthemostefficientandeffectivemannerpossible,consideringtheneedsoftheintendedaudience.

Copyright A

BPM


53

2.2.7 Business Processes should be managed in a closed‐loop cycle to maintain process integrity and enable continuous improvement

OrganizationswithmatureBPMcapabilitiesmanagetheirprocessesinaclosed‐loopcyclethataddressestheplanning,design,implementation,execution,measurement,control,andcontinuousimprovementofbusinessprocesses.

BPMliteratureisrifewithBusinessProcessLifecyclesthatdescribethisclosed‐loopmanagementapproach.RegardlessofthenumberofphasesinaBusinessProcessLifecycleandregardlessofthelabelsusedtodescribethem,thevastmajoritycanbemappedtothePlan,Do,Check,Act(PDCA)CyclemadepopularbyDr.W.EdwardsDeminginthe1950s.

Figure9.Deming’sPlanDoCheckAct(PDCA)Cycle

Becauseofitssimplicity,celebrity,andlackofbiastowardanyspecificandcommercializedmethodologyorframework,thePDCALifecyclewillbeusedhereinourdiscussionofBusinessProcessLifecycleandLifecycleManagement.

PracticalapplicationofaBusinessProcessLifecyclecanvarygreatly,dependingonthescopeofthattowhichitisapplied.Ononeendofthespectrum,theLifecyclecanbeappliedseparatelytoBusinessProcessesthataredefined,implemented,andmanagedindependentlyofoneanother.Thispracticeisoftenseeninone‐offprocessimprovementinitiativesandwithinorganizationswhosebusinessandprocessarchitecturedisciplines(andconsequently,conceptsofarchitecturalcomponentinteroperabilityandreuse)havenotfullymatured.Ontheotherendofthespectrum,theLifecyclecanbeappliedtoBusinessProcessesinaggregatewhenitisrecognizedthattheengineering,deployment,andmanagedcoordinationofmanybusinessprocessesspanningmultiplefunctionalorganizationsiswhatultimatelyleadstooptimizeddeliveryofvaluetoCustomer.ThislevelofLifecycleapplicationiscommoninorganizationsthathavesuccessfullyinvestedinanenterprise‐levelBusinessProcessManagementimplementationwithafullybakedbusinessandbusinessprocessarchitecturediscipline.

Forthisdiscussion,thePDCABusinessProcessLifecycleisappliedtoasingleBusinessProcess,asiscommoninone‐offprocessdevelopmentorimprovementefforts.

Copyright A

BPM


54

ThePlanPhase

Thepurposeofthe“Plan”phaseofthePDCALifecycleistoensurethatbothbusinessprocesscontextandinternalprocessdesignalignwiththeorganization’sstrategicobjectives.

Figure10.

Definingthebusinesscontext(BusinessContextDefinition)isthevehicleforensuringasolidunderstandingofhowtheprocessrelatestoitsexternalenvironment.Thiscriticalstepisperformedtoensureanunderstandingofprocessscopewhenthefollowinginformation,ataminimum,isknown:

Thecustomeroftheprocess Theprocessoutputandaclearunderstandingofwhytheprocessoutputis

consideredvaluabletothecustomer Howtheprocessandprocessoutputaligntotheorganizationalmissionand

supportstrategicobjectives(i.e.,how,contextually,theprocessfitsintoanoverarchingprocessarchitecture)

Theprocessinput(s),theevent(s)thatcantriggerprocessexecution,andthechannelsthroughwhichthosetriggerscanoccur

Theexistenceofcontrols,suchasexternalregulationorinternalpoliciesandrules,whichconstrainprocessdesignandexecution

Baselineperformance(effectivenessandefficiency)targets(assumingthisisanexistingbusinessprocess)

Future‐stateperformance(effectivenessandefficiency)targets

OnceBusinessContextisestablished,theinternalworkingsofthebusinessprocesscanbedesigned.Thisstepiscriticalindefiningwhatdeliverablesareproduced,whatworkisperformed,whentheworkisperformed,where,bywhom,andunderwhatconstraints.Awell‐designedbusinessprocesswillyieldandclearlyarticulate,ataminimum,

Theactivitiesthatmakeupthebusinessprocess Thevariousdeliverablesandartifactsthatareproducedduringprocess

executionandthevariousstatesthroughwhichtheyprogress Organizations,functions,androlesthattakepartinprocessexecution Informationsystemsusedtosupportprocessexecution Thevariouslocationsinwhichactivitiesareperformedandinwhich

deliverablesandartifactsrelatedtotheprocessarestored Specificeventsthatdriveprocessexecution

Copyright A

BPM


55

Businessrulesthatconstrainprocessexecution Processperformancemetricsandmeasurementpoints.

Additionally,awell‐designedbusinessprocesswilldetailtherelationshipsbetweenthebusinessprocesscomponentsidentifiedabove.Forexample,

Whichrolesareresponsibleforexecutingwhichactivities Whichactivitiesproducewhichdeliverables Whicheventstriggerwhichactivities Whichactivitiesareexecutedinwhichlocations Whichdeliverablesarestoredinwhichlocations Whichinformationsystemssupportwhichactivities.

Successinthe“Plan”phaseyields

AclearunderstandingofhowthebusinessprocesssupportstheOrganizationalMission.Inotherwords,validationthattheprocessoutputeitherindirectlyordirectlycontributestothecustomervalueproposition.

AssurancethatprocessdesignsupportstheOrganizationalVision.Inotherwords,ifdeployedasdesigned,theprocesswillmeetperformanceexpectationsthatcanbetracedtooverarchingorganizationalefficiencyandeffectivenesstargets.

Inorganizationsthatlacktheabilitytoengageinproperplanning,processdevelopmentisdriveninsteadbyassumptionandgutfeel.Theseorganizationsoftensufferfrommisalignment,politicalinfighting,operationalfirefighting,valuechainsbrokenacrossfunctionalsilos,operationalstafffeelingdisconnectedfrommanagement,andaninabilitytodriveforwardprogress.

TheDoPhase

Thepurposeofthe“Do”phaseofthePDCALifecycleistodeploytheprocessperthespecificationsdevelopedinthe“Plan”phaseandtocommittheprocesstooperations.

Figure11.

Thephysicalimplementationofbusinessprocesscantakemanyforms,includingbutnotlimitedto:

Copyright A

BPM


56

Creationofnewrolesandroleresponsibilitiesorthemodificationofexistingones

Developmentorrestructuringoffunctionalorganizations Buildorenhancementofinformationsystems,includingfunctionalapplications

andbusinessprocessandworkflowautomation DevelopmentanddeploymentofoperationalsupporttoolssuchasStandard

OperatingProcedures,JobAids,andSystemUserGuides Introductionofnewcustomerchannelsandtouchpoints Creationandimplementationofprocessperformancemonitoringmechanisms,

performancedashboards,andescalationmechanisms.

Oncethebusinessprocessisdeployedintooperations,the“Do”phaseofthePDCALifecyclealsoaddressesactualprocessexecution.Inotherwords,

Theprocessistriggeredbyinitiatingevents Processinputsarrive Activitiesareexecuted Sub‐deliverablesareproduced Processoutputsaregeneratedanddelivered.

Asdefinedaboveandillustratedinthediagrambelow(Figure13),abusinessprocessisacollectionofactivitiesthatproducesaspecificoutputofvalue(productorservice)toacustomer.Thisdefinitionhasbothaninternalaspect(collectionofactivities)andanexternalaspect(valuetocustomer),soprocessperformanceisbestmonitoredfrombothperspectives.

Performancemeasuresgatheredfromoutsidein,orfromthecustomerperspective,aretypicallyreferredtoaseffectivenessmeasuresandaredesignedtoanswerthequestion“Arewedoingtherightthings?”Thesemeasuresareputinplacetoensurecustomerneedsandexpectationsareconsistentlymet.

Performancemeasuresgatheredfrominsideout,orfromtheinternaloperationsperspective,aretypicallyreferredtoasefficiencymeasuresandaredesignedto

TheCheckPhase

Thepurposeofthe“Check”phaseofthePDCALifecycleistomeasureprocessperformanceagainstperformanceexpectations.

Figure12.

Copyright A

BPM


57

answerthequestion“Arewedoingthingsright?”Thesemeasuresareputinplacetomonitorprocessperformancewithrespecttotimeandcost.

Figure13.

Awell‐architectedprocessdefinitioninthe“Plan”phaseisthekeytoachievingusefulmetricsinthe“Check”phase.Asillustratedinthediagrambelow(Figure14),customerexpectationsaroundproductorservicedeliverydriveprocessperformancetargets.Thesehighest‐levelperformancetargetsareinturndecomposedintounderlyingperformancetargetsthatcanbesetatthefunctionalandoperationallevel.Intheory:

Ifalloperationaltargetsaremetthenfunctionaltargetsaresatisfied Ifallfunctionaltargetsaremetthenhighestlevelprocessperformancetargets

aresatisfied Ifallprocessperformancetargetsaresatisfiedthensoisthecustomer.

Copyright A

BPM


58

Figure14.

The“Check”PhaseofthePDCALifecyclerepresentsthemechanismformeasuringagainstthesetargets.

Acriticalfactorinunderstandingthe“Check”phaseofthePDCALifecycleisthatprocessperformancemeasurementcanbeextremelycomprehensive,involvingthegatheringofawidevarietyofdatafromanumberofsourcesandfeedingarangeofdecisionsandactionsinthe“Do”phasewhichspanareal‐time,near‐term,andlonger‐termtimehorizon.

Traditionalcategoriesofperformancemeasuresinclude:

Timeliness:e.g.,throughput,cycletimeanddeliveryondatepromised ProductQuality:e.g.,freedomfromdefects,volumeofreworkandproduct

reliability ServiceQuality:e.g.,responsiveness,trustworthinessandservicereliability Cost:e.g.,laborcost,materialcost,overheadandcostofrework CustomerSatisfaction:e.g.,productorserviceperceptionsmeetexpectations.

TheActPhase

Thepurposeofthe“Act”phaseofthePDCALifecycleistomakedeterminationsandreactaccordinglytoprocessperformancedatacollectedinthe“Check”phase.Thisphaseenablesmaintenanceofprocessintegritydespiteenvironmentalinstabilityandthroughenvironmentalchange,andensurestheprocesscanbecontinuallyimprovedtomeetnewperformancegoalsovertime.

Figure15.

Twocategoriesexistfor“Acting”onprocessperformancedatacollectedfromthe“Check”phase:

Copyright A

BPM


59

Actionsonindividualprocessinstances(real‐timeornear‐real‐timeintervention)

Identificationandplanningofchangetoprocessdefinitionanddeployment(i.e.,changingthewayallprocessinstanceswillbeexecutedinthefuture).

Thefirstcategory(actionsonindividualprocessinstances)canonlyhappenwherereal‐timeornear‐real‐timeperformancemonitoringexists.Forexample,aspartofanewhireprocess,aworkspacemustbesetupbySpaceManagementtwodayspriortostartdate.Processmonitoringisperformedtoensurethisoccurs.Ifitdoesnot,theissueisescalatedalongadefinedescalationpathforresolution.

Thesecondcategory(identificationandplanningofchangetoprocessdefinitionanddeployment)isthefeedbackloop,whichensuresthecontinuityofaprocessthroughenvironmentalchangeandenablesthecontinuousimprovementofaprocessovertime.Forexample,frommonitoringactivitiesinthecheckphase,thefollowingisdeterminedaboutthenewhireprocess:

45%ofallworkspacesetupsarenotcompletedwithinthetwo‐days‐prior‐tostart‐datetimerequirementandmustbeescalated,whichincreasesthecosttofulfillby$2000perincident

95%ofHumanResourceSpecialistsindicate“Dissatisfied”or“ExtremelyDissatisfied”withtechnologiestosupportpre‐employmentscreeningandtrackingactivities

Anewunionrequirementdictatesthatallnewlyhiredfull‐timeemployeesmustbeprovidedanergonomicassessmentoftheirworkspaceandreasonableaccommodationwithinonemonthofstartdate

Executiveleadershipestablishesanewobjective:Reducetimetofillavacantpositionby22businessdays.

Alloftheaboveexamplesrepresentpotentialchangestothecurrent‐stateprocessdefinitionanddeployment.The“data”tosupporttheseobservationsiscollectedduringthe“Check”phaseofthePDCALifecycle.Future‐stateprocessdefinitionstemmingfromtheseobservationswilloccurinthe“Plan”phase.Therefore,the“Act”phasemustaccommodate:

Thecollectionandaggregationofdataandobservationsfromthe“Check”phase Ananalysisofthisdataandlistofobservationsforcriticalityandimpact Thedevelopmentofrecommendationstoaddresstheeachiteminthelist(i.e.,

future‐statedesignrequirements) Arankingandprioritizationofallfuture‐statedesignrequirementstobe

accommodatedduringthenext“Plan”phaseofthePDCALifecycle.

2.2.8 Coordinated and Proactive Management of Business Processes requires significant investment in internal business capability development

Inourdiscussionabove,thePDCALifecyclewasappliedtothemanagementofasinglebusinessprocessinisolation.Inreality,onanenterprise‐wideorevenonanorganization‐widelevel,valuetocustomercannotbewhollydeliveredthroughthe

Copyright A

BPM


60

executionofasinglebusinessprocess,butratherthroughthecoordinatedmanagementofmanyintertwinedbusinessprocesses.

Forthisdiscussion,businessprocessescanbecategorizedintothreetypes:

1. PrimaryProcessesareend‐to‐end,typicallycross‐functionalprocessesthatdirectlydelivervaluetocustomer.Primaryprocessesareoftenreferredtoas“core”processesbecausetheyrepresenttheessentialactivitiesanorganizationperformstofulfillitsmission.Theseprocessesmakeupthevaluechainwhereeachstepaddsvaluetotheprecedingstep,measuredbyitscontributiontothecreationordeliveryofaproductorserviceandultimatelydeliveringvaluetoacustomer.

2. SupportProcessesaredesignedtosupportprimaryprocesses,oftenbymanagingresourcesand/orinfrastructurerequiredbyprimaryprocesses.Themaindifferencebetweenprimaryandsupportprocessesisthatsupportprocessesdonotdirectlydelivervaluetocustomers,whileprimaryprocessesdo.Commonexamplesofsupportprocessesincludethosefoundininformationtechnology,facilities,financeandhumanresourcemanagement.Whilesupportprocessesareoftentightlyassociatedwithfunctionalareas(forexampleaprocessthatgrantsandrevokesnetworkaccess),supportprocessescanandoftendocrossfunctionalboundaries.

3. ManagementProcessesaredesignedtomeasure,monitor,andcontrolbusinessactivities.Theyensurethatprimaryandsupportprocessesaredesignedandexecutedinamannerthatmeetsoperational,financial,regulatory,andlegalgoals.Managementprocesses,likesupportprocesses,donotdirectlyaddvaluetocustomersbutarenecessarytoensuretheorganizationoperatesaccordingtoeffectivenessandefficiencytargets.Asexplainedearlierinthischapter,theBusinessProcessManagementdiscipline,ifimplementedsuccessfullyandcomprehensively,constitutesasetofinternalbusinesscapabilitiesthatincludetheabilitytodesign,deploy,monitor,control,andcontinuouslyimprovebusinessprocesses.Thesecapabilitiesarethemselvesrealizedthroughtheexecutionofbusinessprocessesthatexistsolelyforthepurposeofdesigning,deploying,monitoring,controlling,andcontinuouslyimprovingotherprimaryandsupportbusinessprocesses.TheseconstituteaBusinessProcessManagementDisciplineandareprimeexamplesofManagementProcesses.

Understandinghowthesethreedifferenttypesofbusinessprocesses(Primary,Support,andManagement)interactandinterfacewitheachotherinacomplexorganizationisabsolutelyessentialtounderstandingtheBusinessProcessManagementdiscipline.Consider,forexample,acardealershipandthetotalvaluedeliveredtocardealershipcustomers.Thismightinclude: Theabilitytopurchaseacar Theabilitytofinanceacar(ifnecessary) Theabilitytohaveacarserviced(ifelected).

Copyright A

BPM


61

Fromanoutside‐in1perspective,allthecustomerreallyseesistheoutputofthreebusinessprocesses:

Sellacar(thecustomerdrivesoffinanewsetofwheels) Financeacarsale(thecustomerreceivesapaymentcouponinthemail) Serviceacar(thecustomerbringsthecarinperiodicallyforanoilchangeand

tune‐up)

TheseareexamplesofPrimaryBusinessProcessesbecausetheydirectlydelivervaluetoacustomer.

Alookinsidethecardealershipatwhatittakestodeliverthisvaluetocustomerrevealsamuchmorecomplexpicture.Todeliverthisvalueconsistentlyandtoremaincompetitiveinthemarketplace,thecardealershipmustpossessanumberofinternalcapabilitiesperhapsnotrecognizabletothecustomer.Forexample,theabilityto

Accesscapitaltopurchaseinventoryfrommanufacturer Assessthemarketplacetooptimizethemixofusedandnewcarsandcarmodels

ininventory Ordercarsfrommanufacturersandwholesalers Keeptheshowroomfloorandinventoryofvehiclescleanandpresentable Managecustomerandsupplierdata Hireandonboardsalespeople,financespecialists,andservicetechnicians Managepayrollandbenefits Monitorinterestratesandassessfinancepackagesandoptionsfromcompeting

suppliers Stocktheservicecenterwithpartsandtools.

Eachofthese“abilities”isrealizedthroughtheexecutionofoneormoreSupportBusinessProcesses.Noneofthemdirectlyaddsvaluetocardealershipcustomers,butafailureinanyoneofthemcouldresultindegradationofvaluedelivered.

Additionally,ifthedealershipistrulypracticingcomprehensivemanagementofbusinessprocesses,itmustalsopossesstheabilitytodothingslike

Measurecustomersatisfaction Measureefficiency(timeandcost)ofservicedelivery Identifyopportunitiesforprocesschangeandimprovement Alignprocessimprovementopportunitiestostrategicobjectivesandprioritize

themaccordingly Buildprocessimprovementopportunitiesintofuture‐statedesignanddeploy

thesedesignseffectivelyandefficientlyintooperations Measurethereturnoninvestmentofalltheabove.

1BusinessProcessManagement(BPM)isaTeamSport:PlayittoWin!,AndrewSpanyi,2003

Copyright A

BPM


62

Eachofthese“abilities”isrealizedthroughtheexecutionofoneormoreManagementBusinessProcessesthatconstituteaBusinessProcessManagementdiscipline.LiketheSupportBusinessProcesses,noneofthemdirectlyaddvaluetocardealershipcustomers,buttheyareputinplacetooptimizetheefficiencyandeffectivenessofthisvaluedelivery.

Inenterprise‐wideoreveninlargeorganization‐wideBusinessProcessManagementimplementationswheredozenstohundredsorthousandsofintertwinedbusinessprocessesmustbemanagedinconcert,itistypicaltoseeinvestmentinthedevelopmentofspecializedcapabilitiestosupportthiseffort.InourdiscussionofBusinessProcessLifecycleManagement,thePDCALifecyclewasappliedtothemanagementofasinglebusinessprocess.ToapplyittothecomprehensivemanagementofallPrimary,Support,andManagementprocessesdeployedwithinanenterpriserequiresunderstandingthevariousspecializedcapabilitiesthatmustexist.Thesecapabilitiesmaybehousedwithinasinglebusinessfunction(i.e.,a“CenterofExcellence”)orspreadthroughspecializedrolesacrossseveralbusinessfunctions.

Managingbusinessprocessesinaggregatethroughthe“Plan”PhaseofthePDCALifecycleusuallyinvolvesthedevelopmentofcapabilitiestosupportProcessPlanningandDefinition.Forexample,

StrategicPlanningtoensurestrategicobjectivesarealignedtomarketneedandresultingstrategiesaretiedtounderlyingcapabilities,processes,functions,andtechnologies

EnterpriseArchitecture(incorporatingattheveryleastBusiness,Information,Application,andTechnologyArchitecturedisciplines)toensurethatcriticalorganizationalcomponentsareidentifiedandrelationshipsbetweencomponentsareoptimized

TransformationPlanningtodriveorganizationalstrategiesthrougharchitecture,culminatinginoptimalandachievableFuture‐StateOperatingModelsandtheRoadmapsforachievingthem.

Managingbusinessprocessesinaggregatethroughthe“Do”PhaseofthePDCALifecycleusuallyinvolvesthedevelopmentofcapabilitiestosupportDetailedProcessDesign,Build,andDeployment.Forexample,

PortfolioManagementtosequence,initiate,andmanagetheexecutionoflargeportfoliosofbusiness‐centricandtechnology‐centricinitiativesdrivenfromTransformationPlanning

ProjectManagementtomanageindividualbusiness‐centricandtechnology‐centricinitiativesunderneathprojectportfolios

OrganizationalChangeManagementtobothprepareforandsupporttheorganizationthroughchange,andtocontinuouslymonitorandassessanorganization’scapacityforchange.

Copyright A

BPM


63

Managingbusinessprocessesinaggregatethroughthe“Check”PhaseofthePDCALifecycleusuallyinvolvesthedevelopmentofcapabilitiestosupportPerformanceMonitoringandReporting.Forexample,

PerformanceMonitoringtoassessreal‐timeandnear‐real‐timeprocessperformanceanditsimpactondeliveryofvaluetocustomer,andalsotocollectdatatosupportfuturebusinesschangeandcontinuousimprovementinitiatives

PerformanceReportingtoensurethatappropriateprocessperformance‐anddecision‐supportinformationisavailableattherighttimeandattherightlevelofdetailtorolesatalllevelsoftheorganization,fromexecutivestooperationsstaff.

Managingbusinessprocessesinaggregatethroughthe“Act”PhaseofthePDCALifecycleusuallyinvolvesthedevelopmentofcapabilitiestosupportResponsetoChangeandContinuousImprovement.Forexample,

BusinessProcessAnalysistoassesswhetherprocessperformanceandultimatedeliveryofvaluetocustomeristrulymeetingperformanceexpectations,andwherepotentialproblemsoropportunitiesforimprovementmightexist

ChangeResponseandContinuousImprovementtointake,assess,prioritize,andactuponbothshort‐termandlong‐termperformancebreachesandopportunitiesforprocessimprovement.

2.2.9 Internal capabilities required to support enterprise‐wide Business Process Management are developed along a Process Maturity Curve.

Asintroducedabove,myriadinternalbusinesscapabilitiesmustbematuredtofullysupportalarge‐scaleBusinessProcessManagementimplementation.ManyorganizationslaunchingintoBusinessProcessManagementfindthatthesecapabilitiesalreadyexistinvariousstatesofmaturitywithintheenterprise.Inthiscircumstance,movingforwardwithBusinessProcessManagementimplementationisanexerciseintyingtogetherthesealready‐existentcapabilitiesunderaprocess‐orientedorganizationalfocusandmindset.

Otherorganizationsinwhichthesecapabilitiesdonotexist,especiallythosethatcommittoBusinessProcessManagementbecausetheyareinsuchastateofdecayandchaosthattheymustdosoinordertoremaincommerciallyviable,arefacedwiththedauntingtaskoffiguringouthowandwhentointroducethesecapabilitiesintotheorganization.Understandingandtrackingtheorganization’srelativeplacementonaProcessMaturityCurve,andalsounderstandingwhichcapabilitiesneedtobematuredovertimeastheorganizationprogressesalongtheMaturityCurve,areconsideredhelpfulandworthwhileexercisesbymanyorganizationsintheimplementationofBusinessProcessManagement.

AswithBusinessProcessLifecycles,BPMliteraturehasanabundanceofBusinessProcessMaturityCurves,rangingfromtheverysimpletotheverycomplex.Averysimplematuritycurveispresentedheretofacilitateunderstandingofthewaymany

Copyright A

BPM


64

organizationssequencethedevelopmentofinternalbusinesscapabilitiestosupportthematurationoftheBusinessProcessManagementdiscipline.

Figure16.

ByanalyzingthestateofitsbusinessprocesseswithinthecontextoftheProcessMaturityCurveabove(Figure16),anorganizationcandeterminewhetherthestateofitsprocesses(eitherindividuallyorinaggregate)isAdHoc,Defined,Controlled,ArchitectedorProactivelyManaged,anddetermineaccordinglywheretofocusresourcesindevelopinginternalbusinesscapabilities.

Business Processes in the Ad‐Hoc State

OrganizationsintheAd‐Hocstatehaveverylittleifanyunderstandinganddefinitionofend‐to‐end,cross‐functionalbusinessprocessandlittlevisibilityintothetruemeansbywhichvalueisdeliveredtocustomer.Whilepocketsoffunctionalactivitydefinitionmayexist(e.g.,viaexistenceofStandardOperatingProcedureorembeddedinonboardingandtrainingmaterial),thesepocketsaretypicallyfoundwithindisparatefunctionalunits;themethodofrepresentationisinconsistentandoftencan’tbeunderstoodwithoutdeepdomainknowledge,andthefunctionalactivitydefinitionrarelytiesinameaningfulwaytooverarchingbusinessprocess.Table2belowsummarizestheproblemsoftenperceivedbyorganizationswithalow(Ad‐Hoc)stateofProcessMaturityandmanyoftheprimarydriversthatcompelorganizationstoinvestinBusinessProcessManagement,withthemyriadinternalcapabilitiesrequiredtosupportit.

Copyright A

BPM


65

Customers /

Suppliers /

Partners

Lowcustomersatisfactionwithproductsorservicesandlossofcustomers

Increasedpenaltiesforproductqualityissuesand/orservicebreaches

Unmanageablecomplexityduetoincreasednumbersofcustomers/suppliers/partners

Longleadtimestomeetrequestsandpersistentdeliveryfailures

Supplierandpartnercomplaints,priceincreasesorrefusaltodobusiness

Management

Lackofreliableorconflictingmanagementinformation Lackofvisibilityintooperationstounderstandand

predictproblems Lackofdecision‐supportinfrastructuretoreact

appropriatelywhenproblemsoccur Difficultyattractingandretainingtalent Highcostofonboardingandtrainingstaff Inabilitytoexpandcapacity,despiteincreasedheadcount Massivedisruptionsstemmingfromorganizational

changesuchasreorganizationandinformationsystemdeployments

Employees

Lackofemployeeempowermentandsatisfaction Employeeapathy,lackofengagement,andlackof

accountability Employeeperceptionofnotknowingwhatvaluethey

provideandwhatisexpected Employeeshavingdifficultykeepingupwithcontinual

changeandgrowingcomplexity

Process

Unclearrolesandresponsibilitiesfromaprocessperspective

Poorproductand/orservicequalityandsubstantialvolumeofrework

Largenumbersofhand‐offsbetweenrolesandlackofstandardprotocolbetweenhandoffs

Highvolumeoftimeaddressing,discussinganddebatingexceptionsanderrorhandling

Grossvariationsinthewayworkisdonebypeopleinthesamerolewhoareresponsibleforproducingthesameoutcome

Acultureofheroicsandarewardsystemthatpraises

Copyright A

BPM


66

heroesandminimizestheimportanceofteamcollaborators

Lackofend‐to‐endunderstandingoftheprocessandlackofunderstandingthedownstreamimpactofvariationsinupstreamactivities

Rolesandfunctionsthatmakeprocess‐relateddecisionswithlittleornoregardforthecustomerperspectiveandimpactoncustomer

Information

Technology

PerceptionthatITisdisconnectedfromthebusinessanddoesnotunderstanditsneeds

Technologyprojectsthatfailtodeliverexpectedvalue SoaringITcostsandalackofunderstandingwhy DisproportionateamountoftimeneededbyITproject

teamstogainanunderstandingofthebusinessdomain,businesscontextoftheproject,andthebusinessrequirements

ProjectsthatarethrownoverthewalltoITwithfeworunclearbusinessrequirements

ITprojectsthatarethrownbackoverthewalltothebusinesswithverylittlefocusonbusinessreadinessandorganizationalchangemanagement

AhighproportionofITsolutionsthataredeliveredtothebusinessbutarenotfullyadoptedoraresummarilyrejected

Table2.

Moving from an Ad‐Hoc to a Defined state of Process Maturity

Organization‐drivingprogressionfromanAd‐HoctoaDefinedstateofprocessmaturitywilloftenmakeinvestmentsinthosecapabilitiessupportingProcessPlanningandDefinitionandDetailedProcessDesign,Build,andDeployment.

WithinProcessPlanningandDefinition(the“Plan”phaseoftheProcessLifecycle)itiscommontosee

Anincreasedawarenessandunderstandingofwhatbusinessprocessis,howitrelatestothedeliveryofvaluetocustomer,andhowittiestooperations‐levelprocedure

Anincreasedawarenessofhowbusinessprocessimprovementinitiatives,alongwithtechnologyimprovementinitiativestieddirectlyandvisiblytofacilitatebusinessprocessimprovement,supporttheorganization’sstrategicdirection

Anincreasedunderstandingofhoworganizationalstructureandinformationtechnologysupportbusinessprocessexecution,andthereforethe

Copyright A

BPM


67

developmentofbetter‐qualitybusinessrequirementstodriveorganizationandtechnologychanges

TheemergenceofBusinessArchitect,BusinessAnalyst,andProcessAnalystrolesasdistinctfromtechnology‐focusedSystemsAnalystroles

Investmentinthedevelopmentofastandardandrepeatablebusinessandbusinessprocessanalysismethodologyandtoolset

Aprogressionfromrudimentarytwo‐dimensionaldrawinganddocumentationtoolstowardtheuseofmoresophisticated,multi‐dimensionalenterprisearchitectureandbusinessprocessmodelingtools.

WithinDetailedProcessDesign,Build,andDeployment(the“Do”phaseoftheProcessLifecycle)itiscommontosee

Thedevelopmentandmaturityofprojectportfoliomanagementandaresultingdecreaseininitiativeredundancies,overlaps,andproject‐teamcollisions(i.e.multipledisjointedprojectteamsdrivingcompetingchangeswithinthesamebusinessprocessand/orbusinessdomain)

Animprovedconnectionbetweenbusinessandinformationtechnology.Specifically,anevolutionfrommyopicfocusonsoftwaredevelopmentthatappearsdisjointedfromsoundbusinessrequirements,towardanexpandedunderstandingofbusiness‐systemsdevelopmentthatmayormaynotbesupportedbysoftwaredevelopment

Technologydeploymenteffortsthataremoretightlycoupledwithbusinessstakeholdersandbetterdeliveronbusinessneed;anevolutionthatplacesmoreemphasisonbusinessreadiness,organizationalchangemanagement,anddevelopmentofbusinessprocessandproceduredefinitionthroughout,inconjunctionwiththeSoftwareDevelopmentLifecycleratherthanasanafterthought,asiscommonwithmaytechnology‐drivenefforts

Organizationalfocusonthedevelopmentanddeploymentofbusinessprocessandprocedureforthesakeofbusinessprocessstabilityandrepeatability,leveragingamorestructured(architecture‐driven)frameworkandmethodfordoingso.

AsindicatedinTable2above,organizationsthatfailtoinvestinbusinessprocessdefinitioncapabilitiessufferfromaninabilityto

Keeppromisestocustomersregardingproductandservicedelivery

Communicateperformanceexpectationstooperationalstaff

Promoteanunderstandingofwhatconstitutes“incompliance”andoperatewithinit

Achieveconsistencyandrepeatabilityinprocessexecution

Controloperationalcosts,especiallyinlightofincreasedorganizationalandenvironmentalcomplexity.

Copyright A

BPM


68

Moving from a Defined to a Controlled state of Process Maturity

OrganizationsdrivingprogressionfromaDefinedtoaControlledstateofProcessMaturityhavetrulybeguntorecognizebusinessprocessesasassetsandhavediscoveredthatthecareandmaintenanceofthemistypicallyworththeinvestment.TheseorganizationshaveseenthevalueofreachingtheDefinedstate,atleastinlocalizedinstanceswithintheorganization,andwanttoprotecttheinvestment.Byanalogy,thisissimilartotherecognitionthatregularoilchangesandservicingonanewvehiclearewhatkeepitoutoftherepairshopandrunningreliably.

AnorganizationalcommitmenttoprogressingfromtheDefinedtoControlledstateofProcessMaturityrequiresaninvestmentinthosecapabilitiessupportingPerformanceMonitoringandReportingandResponsetoChangeandContinuousImprovement(the“Check”and“Act”phasesoftheProcessLifecycle).Specifically,itiscommontosee

AnincreasedawarenessandunderstandingofwhatProcessPerformanceManagementisandwhyitisimportant

Investmentinthetoolsandtechniquestoestablisheffectivenessandefficiencytargetsacrossend‐to‐endbusinessprocessesandanorganizationalcommitmenttomeasureandreportonthemconsistentlyandregularly

Increasedvisibilityacrossmultipleorganizationaldimensionsthroughthemeasureandreportingofprocessperformancedata.Forexample,enhancedexecutivemanagementvisibilityintodailyoperations,betteroperationsstaffunderstandingofmanagementintentanddirection,abetterunderstandingofend‐to‐end,cross‐functionalprocessexecutionanditsrelationtothedeliveryofvaluetocustomer,andabetterunderstandingofcustomerneedsandexpectations

TheemergenceofspecializedrolessuchasProcessOwnersandProcessStewards.Theserolesareengagedinthemanagementofend‐to‐endprocessexecutionacrossfunctionalorganizationsandareheldaccountablefortheultimatedeliveryofvaluetocustomerthroughclearlydefinedproduct‐andservice‐deliverytargets

Thedevelopmentofformalinternalmechanismstoanalyzeprocessperformancedata,intakesuggestionsforprocesschange,assessunplannedchangesintheenvironment,andtoaggregatethisinformationintoresponseandimprovementstrategies

Thedevelopmentofformalinternalstructuresandmethodstofacilitatecross‐functionalcollaborationandtostandardizeprotocolsforcross‐functionalcommunicationanddisputeresolution.

Organizationsthatfailtoinvestinbusinessprocesscontrolcapabilitiessufferfrom

Theinabilitytodefinitivelyprove(i.e.throughdata)whetherinvestmentinbusinessprocessmaturationhasproducedanyrealresultstowardthe

Copyright A

BPM


69

bottomline.Withouttheabilitytoprovereturnoninvestment,fundingquicklydisappearsandtheorganizationislefttoassumethatthefocusonbusinessprocessesis“notwhatisneededtomoveforward”

Theunfortunate(butverycommon)phenomenoninwhichsignificantinvestmentismadetowardbusinessprocessdefinitionanddeployment,buttheartifactsbecomestaleasquicklyastheyaredevelopedbecausethereisnomechanismtokeepthemuptodatethroughbusinessandenvironmentalchange.Here,too,itiscommonfororganizationstoreachtheconclusionthatthey“triedthatbusinessprocessmanagementthinganditdidn’tworkout.”

Forthesereasons,organizationsinvestingheavilyinthe“Defined”stateofprocessmaturityareoftenadvisedbyconsultantsandpractitionerstoinvestinthedevelopmentof“Control”capabilitiessimultaneously.Becauseoftheincrediblechange‐managementchallengesoftenencountered,especiallyinorganizationsthatareextremelyfracturedacrossfunctionalsiloes,startingsmallandinanon‐criticalareaofthebusinessisoftenthechosenstrategy.

Moving from a Controlled to an Architected state of Process Maturity

Assuggestedabove,organizationsthatinvestinBusinessProcessManagementimplementationsarewelladvisedtostartsmall,onnarrowlyfocusedpilotprojectsinareasofthebusinessthatarenotmissioncritical.ThisadvicehasbecomewidelyacknowledgedamongstBusinessProcessManagementprofessionalsandpractitionersandisevidencedthroughoutBusinessProcessManagementliterature.AsBusinessProcessManagementconceptsandbestpracticesbegintotakeholdwithintheorganization,andassuccessesarerealized,thefootprintofBusinessProcessManagementimplementationwillbegintogrowandexpandacrosstheenterprise.

OrganizationsthatexperiencesuccessinBusinessProcessManagementimplementationandbegintoexpandthefootprintofimplementationmustaddresstherealitythatlarge‐scalepracticeofBusinessProcessManagementisincrediblyinformation‐anddata‐intensive.Developingatrueunderstandingofandabilitytomanagethe“What,”“When,”“Where,”“Why,”“How”and“Who”oflargeBusinessProcessesportfolioscannotbedonewithoutadedicationtoinformation‐andknowledge‐managementandaninvestmentinArchitecture.

AprogressionfromtheControlledtotheArchitectedstateofProcessMaturity,therefore,isanaturalandmandatoryoneasthefootprintofBusinessProcessManagementimplementationexpandsandthevolumeofbusinessprocessesdefinedandbroughtundercontrolincreases.

Theconceptofarchitectureandthevalueitprovidestothebusinessisoftenmisunderstood.Simplydefined,architectureistheidentificationanddefinitionofcomponentsandtherelationshipbetweencomponents.Forexample,withrespecttohousesandothertypesofbuildings,architectureisusedtoidentifyanddefineatvariouslevelsofdetailthefoundation,framing,roofing,plumbing,electrical,andinterior‐finishcomponentsandhowtheyareassembled.Similarly,withrespecttothebusiness(andinthecontextofBusinessProcessManagement),architectureis

Copyright A

BPM


70

usedtoidentifyanddefinethecomponentsthatmakeupthebusinessandtherelationshipsbetweenthesecomponents—i.e.,productsandservices,capabilities,processes,procedures,customers,organizations,roles,workproducts,locations,events,businessrules,informationsystems,goals,performanceindicators,andsoon.

AnorganizationalcommitmenttoprogressingintotheArchitectedstateofProcessMaturityrequiresaninvestmentinthosecapabilitiessupportingPlanningandDefinition(the“Plan”phaseoftheProcessLifecycle),specificallyinthedevelopmentofthevariousEnterpriseArchitecturedisciplines.Forexample,itiscommontoseeinvestmentin

StrategicPlanning:adisciplinethatdealswithbusinessmotivationandthecustomervalueproposition.Specifically,StrategicPlanningidentifiesandrelatescomponentslikevisionandmission,objectivesandstrategies,productsandservices,andinternalandexternalhealthindicatorstooptimizeandimprovemarketposition.

BusinessArchitecture:adisciplinethatidentifiesandrelateskeybusinesscomponentssuchasproductsandservices,internalcapabilities,businessprocesses,businessfunctionsandroles,performancegoals,keyperformanceindicators,andinformationsystems.BusinessArchitectureensurescriticalbusinesscomponentsaretiedtogetherinamannerthatbestsupportsbusinessstrategy.

InformationArchitecture:adisciplinethatidentifiesandrelatesdataandinformationcomponentsrelevanttocustomers,partners,suppliers,andinternalbusinessentities.InformationArchitectureaddressesthecontentandstructureofdataandinformationcomponentsthatarecreatedandtransformedthroughthevariousbusinessprocessesthatmakeuptheenterprise.

ApplicationArchitecture:adisciplinethatidentifiesandrelatestheenterprisesuiteofapplicationsandallsub‐componentsthatmakeupindividualapplicationstoensuretheyarescalable,reliable,available,andmanageable.ApplicationArchitectureensuresthatthevariousfunctionalapplication,workflowautomation,andbusinessprocessmanagementsystemsareoptimizedtosupportbusinessprocessexecution.

CoreServices(ServiceOriented)Architecture:adisciplinethatidentifiesandrelatestheinformationandtechnologycomponentsassembledtocreatecorebusinessservicesthatareimplementedthroughtechnology.Specifically,CoreServicesorServiceOrientedArchitectureensuresthatthecomponentscomprisingWebServices,web‐basedapplications,databases,andtechnologyinfrastructureareoptimizedtomakedataavailableandappropriatelypackagedforuse(consumption)bybusinessprocesses.

OrganizationsthatinvestinBusinessProcessManagementbutfailtoinvestinthedevelopmentofcapabilitiesrelatedtoArchitecturesufferfromtheinabilityto

Copyright A

BPM


71

Assessthetrueimpactofchangeacrossallofthevariouscomponentsthataffectthe“What,”“When,”“Where,”“Why,”“How”and“Who”ofbusinessprocessexecutionanddeliveryofvaluetocustomer.Forexample,theabilitytoanswerquestionssuchas“Whatareallthebusinessprocessesandoperations‐levelproceduresimpactedbyanexternalregulationchange?Reorganization?Aninformation‐systemdeployment?”

Efficientlyidentifyandfixproblemsstemmingfromunplannedchange,whichimpactsprocessperformanceandproduct‐andservice‐deliverytargets

Identifycomponent(bothbusinessandtechnology)interoperabilityrequirementsandopportunitiesforreuse,orabilitytobuildthesefactorsintoinitialdesigninordertoincreaseoperationalefficienciesandpreventcostlyrework.

Moving from an Architected to a Proactively Managed state of Process Maturity

ProactiveBusinessProcessManagementreferstotheabilitytopredictandplanforchangeinordertotakeadvantageofitortopreventitfromcompromisingthedeliveryofvaluetocustomer.ProactivemanagementofbusinessprocessesistheHolyGrailofBusinessProcessManagement.OrganizationsthatconsistentlypracticeproactiveBusinessProcessManagementareabletocontrolchangeatalllevelsoftheorganizationratherthanbevictimsofchange.Forexample,inorganizationspracticingproactiveBusinessProcessManagement,

Reorganizationsaredrivenfromstrategicplanningandarchitectureasameanstooptimizehowfunctionsarestructuredtosupportbusinessprocessexecutionandthedeliveryofvaluetocustomer.Duringplanningitisunderstoodwhichproducts,services,processes,procedures,functions,roles,jobaidsandinformationsystemswillbeimpactedbythereorganization.Thesecomponentsareallassessedforimpact:planstoretrofitandupdatethemareestablishedandcanbecontrolledinconjunctionwiththereorganization,ratherthanasapost‐reorganizationfirefight.

Theorganizationcanquickly,easily,andappropriatelyrespondtoregulationchangesandotherexternalpressuresandthreats.Forexample,bymanyestimates,totalcoststoimpactedorganizationsofaddressingthecombinedY2KthreatandtheSarbanes‐OxleyActinthelead‐uptotheyear2000andbeyondwasoveratrillionUSdollars.Muchofthiscostwasincurredbecauseofinadequatemeanstodiscovertheimpactonoperationsandinefficientmeansofdrivingtheappropriatechangeintooperations.

OrganizationspracticingproactiveBusinessProcessManagementhavematuredandbroadlydeployedinternalbusinesscapabilitiestosupportallphasesoftheProcessLifecycleinaclosed‐loopsystemofmanagement:

Copyright A

BPM


72

Figure17.

ThecapabilitiessupportingProcessDefinitionandPlanning(the“Plan”phaseofthePDCALifecycle)ensurethatthecontextandhigh‐levelarchitectureofallPrimary,Support,andManagementprocessesacrosstheenterpriseareoptimizedtomeettheorganization’sstrategicdirection.

ThecapabilitiessupportingDetailedProcess,Design,Build,andDeployment(the“Do”phaseofthePDCALifecycle)ensurethatallbusinessprocessesareplacedinoperationsaccordingtothespecificationsdevelopedinthe“Plan”phase.

ThecapabilitiessupportingPerformanceMonitoringandReporting(the“Check”phaseofthePDCALifecycle)ensurethatprocessperformanceisconsistentlyandholisticallymeasuredagainstperformanceexpectationsestablishedinthe“Plan”phaseandthatperformanceinformationisreadilyavailableandconsumablebyallrolesthatrelyuponit.

ThecapabilitiessupportingResponsetoChangeandContinuousImprovement(the“Act”phaseofthePDCALifecycle)ensurethattheorganizationcanbestdetermine,andreactappropriatelyto,informationcollectedinthe“Check”phase.Thesecapabilitiesensurethatprocessintegrityismaintaineddespiteenvironmentalinstabilityandchange,andarethecatalystforcontinuedimprovementofprocessesovertime.

Fromthe“Act”phaseofthePDCALifecycle,newstrategic,functional,andoperationaldirectivesarepushedintothe“Plan”phasefordefinitionandplanning,therebycontinuingthecycleofthisclosed‐loopmanagementsystem.

2.2.10 A Business Process Management implementation requires the introduction of new roles into the organization

Asdefined,BusinessProcessManagementisamanagementdiscipline.Itrepresentsabodyofknowledgethataddressestheprinciplesandpracticesofbusinessadministrationandspecifiesacodeofconductandmethodsthatdirectthemanagementofbusinessresources.

Copyright A

BPM


73

Inherentintheconceptofmanagementandmanagementdisciplineistheconceptofgovernance.Genericallydefined,governanceisastructuredapproachtodecisionmakingandthemeansbywhichdecisionsareimplemented(ornotimplemented).Appliedtobusinessprocesses,governanceimplies

Structureddecisionmakingregardinghowanorganizationfunctionswithrespecttothedeliveryofvaluetocustomer

Astructuredapproachtoimplementingchangesinthewayanorganizationfunctionswithrespecttothedeliveryofvaluetocustomer.

Theend‐to‐endandthereforecross‐functionalnatureofmanagingbusinessprocessescreatesaneedforspecializedrolestosupportgovernance.Intraditional,functionallymanagedorganizations,strategicintentispushedintobusinessfunctionsataveryhighlevel,andstructureddecisionmakingisconstrainedwithinorganizationalboundaries.Asaresult,andasdepictedinthediagrambelow(Figure18),inefficienciesandbreakdownsmostoftenoccurinthehandoffsbetweenfunctionalorganizationsbecausethereexistsamanagementvacuum.Becausefunctionalmanagersaremeasuredandevaluatedfortheirperformanceinoptimizingtheirfunctions,thereexistsavoidinresponsibilityforoptimizingthehandoffsbetweenfunctions.

Figure18

Toaddresstheissueofprocessinefficiencies,breakdowns,andcommunicationgapsbetweenfunctions,aBusinessProcessManagementimplementationtypicallyintroducesnewrolesintotheorganizationwithresponsibilitiesformanagingprocessesend‐to‐endacrossfunctionalboundaries.

Notethattheintentofthisdiscussionistonotbeprescriptive,butrathertointroduceconceptsandprovideaframeworkforconceptualunderstanding.Thelabelsattachedtoprocess‐centricrolesandtheexactroleresponsibilitiesassociatedwiththemwillvaryfromorganizationtoorganization.Thekeytakeawayisa

Processbreakdownatahandoffbetweenfunctions

Copyright A

BPM


74

conceptualunderstandingofwhythesetypesofrolesandroleresponsibilitiesexistandwhytheyareimportant.

Alsoimportanttonoteinthisdiscussionisthatasingleindividualrepresentingasinglepositionintheorganizationalhierarchycanplaymultipleroles.Inthiscontext,wewillseewhereitmightmakesenseforoneindividualtohavearolewithresponsibilitiesinthemanagementofabusinessfunction,andanotherrolewithresponsibilitiesinthemanagementofoverarchingbusinessprocesses,whichhisorherfunctionsupports.

Whilethelabelsmayvaryfromimplementationtoimplementation,forthepurposeofthisdiscussionwewilllookattherolesandroleresponsibilitiesofthe

ProcessOwner ProcessLeader ProcessSteward ProcessAnalyst ProcessGovernor.

2.2.10.1 Process Owner

TheProcessOwnerisacenterpieceroleinaBusinessProcessManagementimplementationandisassignedoverallresponsibilityfortheend‐to‐endmanagementofoneormorebusinessprocesses.Specifically,thismeansthattheProcessOwnerisresponsibleforensuringtheprocessmeetsestablishedperformance(effectivenessandefficiency)expectations.Forexample,inFigure19below,aperformancetargetof100days’cycletimehasbeensetforaspecificbusinessprocess.TheProcessOwnerisresponsibleforensuringthattheprocessisdesigned,deployed,monitored,andcontrolledinamannerthatmeetsthistargetforeveryprocessinstance.

Figure19

Copyright A

BPM


75

Inordertomeettheseresponsibilities,aprocessownertypically

Engagesateamofstakeholderstodefinebusinessprocesscontextandensurealignmentwithstrategicobjectives

EngagesateamofstakeholdersandSMEstoensurebusinessprocessdesignmeetsexpectationswithinitsdefinedorganizationalcontext

Servesaspointofcontactforprocess‐relatedquestions Ensuresunderstandingofhowpeopleandsystemsareengagedtosupport

processexecution Playsactivestakeholderroleinbusinessandtechnologyinitiativesthatimpact

theprocess Facilitatesbusinessprocessadoption Monitorsandreportsprocessperformancedata Proposesacorrectivecourseofactionifprocessperformanceisnotasexpected Escalatesinstancesofsignificantprocessperformancebreachesrequiring

attention Leadsateamtoassess,prioritize,andimplementrequestsforprocesschange CollaborateswithotherProcessOwnerstoensurealignment.

WithrespecttoorganizationalpositioningoftheProcessOwnerrole,therearefundamentallytwoapproachestoimplementation,FunctionallyAlignedandNon‐FunctionallyAlignedProcessOwnership.

FunctionallyAlignedProcessOwnership

IntheFunctionallyAlignedimplementationapproach,ProcessOwnersreporttoheadsoffunctionalorganizations.Incaseswhereabusinessprocesstranscendsorganizationalboundaries(whichtheymostoftendo),therearetwooptionsfortheresponsibilities(andthereforetheaccountability)ofProcessOwnership:

AsingleProcessOwnerisassignedeventhoughsomeprocessparticipantsreporttootherfunctionalorganizations

TheresponsibilityforprocessownershipisassignedtomultipleProcessOwners

Figure20

Thereareinherentweaknessesinbothofthesemodels.Inthefirst,thereisadangerthatprocessparticipantsfromotherfunctionalorganizationsmaynotrecognize

Copyright A

BPM


76

ProcessOwnerauthorityandscopeofmanagement,andsimilarlythatProcessOwnersarelesslikelytotakeresponsibilityforissuesstemmingfromotherfunctions.TheweaknessinthesecondmodelisthatProcessOwnershipissharedacrossfunctions.Thisisreallynodifferentthantraditionalfunctionalmanagementstructuresandintroducesthesamehostofproblems,specificallyalackofclaritywithrespecttomanagementofthehandoffsbetweenfunctions.

TheprosofadoptingafunctionallyalignedProcessOwnershipapproacharethatitislessthreateningtotheexistingpowerstructureandmorefamiliartooperationsstaff.Therefore,functionallyalignedprocessownershiphasmuchlesschanceofbeingsummarilyrejectedatintroductionbytheorganization.Forthesereasons,manyorganizationschoosetoacceptintheshorttermthatthisapproachislesseffective,andviewfunctionally‐alignedprocessownershipasababy‐steptothemoreeffectivebuthardertoimplementapproachofnon‐functionally‐alignedProcessOwnership.

Non‐Functionally‐AlignedProcessOwnership

IntheNon‐FunctionallyAlignedimplementationapproach,ProcessOwnersreportdirectlytotheheadoftheorganization(ortoanorganizationalstructuredirectlyunderthehead).Inthiscase,ProcessOwnersarepeersofthetotheheadsoffunctionalorganizationsintheorganizationalhierarchy.

TheprosofthisapproacharethattheProcessOwnerisinanappropriatepositionintheorganizationalhierarchytoaddresscross‐functionalhandoffissues,andthereisacleardistinctionbetweentheresponsibilitiesofaProcessOwnerandthoseoffunctionalmanagement.

Theconofthisapproachisthatitsignificantlychangesthetraditionalpowerstructurewithinanorganization.Thereisahighpotentialforinitialresistance(typicallyfromfunctionalmanagers)sometimesrequiringextremeinterventionfromexecutiveleadershiptogetthegovernancemodelofftheground.

2.2.10.2 Process Leader

TheroleoftheProcessLeaderisplayedbymembersoftheorganization’sexecutiveleadershipteamandmayormaynotinvolverepresentativesoftheprocessownershipfunction.

InorganizationswhereaBusinessProcessManagementdiscipline

Figure21

Figure22

Copyright A

BPM


77

exists,thetypicalresponsibilitiesoftheExecutiveLeadershipTeammembers(e.g.,developingorganizationalVision,Mission,andCoreValuesandestablishingstrategicdirection)remainintact.

AdditionalresponsibilitiesassociatedwiththeroleofProcessLeadermightinclude

DefiningthevisionandstrategyforBusinessProcessManagementandsponsoringitsimplementation

Ensuringthatprocessperformanceobjectivesareestablishedinalignmentwithstrategicdirection

Confirmingthatprocesschangerecommendationsandprioritizationsareinalignmentwithstrategicintent.

2.2.10.3 Process Steward

TheroleofProcessStewardisplayedbymembersoftheorganization’sfunctionalmanagement—thatis,themanagersofoperationsstaffwhoexecuteactivitieswithinanend‐to‐endbusinessprocess.

InorganizationswhereaBusinessProcessManagementdisciplineexists,typicalresponsibilitiesoftheFunctionalManagementTeammembersinclude

Developingknowledgeandexpertisewithinthefunctionaldiscipline

Attractingandretainingtoptalentwithinthefunctionaldiscipline

Structuringanddevelopingfunctionalteamroledescriptionsandresponsibilities

Definingandmaintainingoperational‐levelprocedures.

ThesetraditionalFunctionalManagerresponsibilitiesremainintactwithinorganizationswhereaBusinessProcessManagementdisciplineexists.AdditionalresponsibilitiesassociatedwiththeroleofProcessStewardmightinclude

Ensuringthatoperational‐levelprocedurealignswithrequirementsofoverarchingbusinessprocessesthatthefunctionsupports

Ensuringthatoperationsstaffareawareofexpectationswithrespecttosupportingoverarchingbusinessprocesses(e.g.performanceexpectations,expectedqualityoftheoutput(s)producedbythefunction,escalationpathsandcircumstancesunderwhichescalationisdesired,etc.)

GatheringandsubmittingfeedbackandsuggestionsforprocessimprovementtotheProcessOwner

Membershipontheteam(ledbyProcessOwner)whichassessesandprioritizesprocesschangerequests

Figure23

Copyright A

BPM


78

Sharinginformationwiththeprocessownerregardingfunctional‐levelperformancethatisrelevanttotheoverarchingbusinessprocess.

2.2.10.4 Process Analyst

Figure24

InsmallBusinessProcessManagementimplementations,theProcessAnalystcanhaveresponsibilitiesacrossallphasesoftheBusinessProcessLifecycle.Inlargerimplementations,ProcessAnalystsmightspecializeinoneortwokeyaspectsofthediscipline.Asamplingoftypicalresponsibilitiesincludes

End‐to‐enddesignoftheorganization’sbusinessprocesses(underdirectionofProcessOwnerandwithinputfromfunctionalSMEs)

Maintenanceoftheprocessmodelrepository CollaborationwithProcessOwnerandStewardstodiagnoseproblemsand

proposesolutions Performinganalyses(e.g.performanceanalysis,impactanalysisandprocess

simulation)asrequestedbyProcessOwnerand/orProcessStewards Typically,membershipontheteamthatassessesandprioritizesrequestsfor

processchange Typically,membershiponprocesschangeimplementationteams.

2.2.10.5 Process Governor

TheroleoftheProcessGovernoriscriticalindrivingprocessmaturationthroughstandardizationinthepracticeanduseofBPMmethodologiesandtools.Thisroleislessfocusedonthecontentoftheorganization’sprocessesthanonhowthatcontentisdocumentedandmanaged.

TheroleofProcessGovernorcanbeplayedbythesamepersonwhoistheProcessOwnerinsmallBPMimplementationsandwhentheProcessOwnerisfunctionallyneutral.However,inimplementations

Figure25

Copyright A

BPM


79

wheretheProcessOwnerisfunctionallyaligned,itisusuallydesirabletohaveaseparateroleofProcessGovernor(reportingtotheHeadoftheOrganization).

TypicalresponsibilitiesofaProcessGovernormightinclude

DefiningBusinessProcessManagementprinciples,practices,andstandards EnsuringthatBusinessProcessManagementprinciples,practices,andstandards

arescalableacrossthecurrentandexpectedfuturescopeoftheBusinessProcessManagementimplementation

Providingguidance,mentorship,andtrainingonbestpracticesandstandards,andenforcingcompliancewiththem.

2.2.11 Business Process Management is not a prescribed framework, methodology, or set of tools

Thebusinesslandscapeisrepletewithframeworks,methodologies,andtoolsthatcanbeappliedtothedefinition,design,execution,monitoring,analysis,andcontrolofbusinessprocesses.Forexample,

EnterpriseArchitectureframeworksandmethodologiessuchasZachman,TOGAF,DODAF,andFEAFareoftenusedtodefinetheorganizationalcontextofbusinessprocessesand,specifically,theirlinktostrategicobjectives.

FrameworksandmethodologiessuchasRummler‐BracheandLeanareoftenusedtooptimizebusinessprocessdesignwithrespecttoactivitiesperformed,deliverablesproduced,andthehumanandinformationsystemresourcesemployed.

Businessprocessescanbedeployedandexecutedbyvariousmeans,includingworkperformedbyhumans,workperformedbymachinessuchasdrillpressesandconveyorbelts,andworkperformedbyinformationsystemssuchasfunctionalapplicationsandworkflowengines.

Variousmethodsandtoolscanbeemployedtoperformreal‐time,near‐real‐time,andaggregatebusinessprocessmonitoring.ExamplesincludeActivityBasedTiming,ActivityBasedCosting,SERVQUAL,andBalancedScorecard.

Similarly,countlessapproachesexisttoaidinbusinessprocessanalysis,includingSixSigma,MonteCarloandDiscreetEventSimulation.

TheBusinessProcessManagementdisciplineaidsanorganizationinestablishingthoseprinciplesandpracticesthatwillenableittobemostefficientandeffectiveintheexecutionofitsbusinessprocesses.WhileaBusinessProcessManagementimplementationcanemployanyoftheabove‐mentionedframeworks,methodologies,andtools,theexactmixwillbedifferentforeachorganization.Forexample,

Amaturebusinessarchitecturefunctionforalargeandcomplexmultinationalcompanytoremaincompetitivemightnotmakesensefora50‐personstartup.

Amanufacturingoperationcanachieveprocessefficienciesbyreplacinghumanlaborwithamaterialhandlingsystem,butamortgagebrokercan

Copyright A

BPM


80

achievethesamebyinvestinginworkflowandbusinessprocessautomationsystems.

Amanufacturingoperationmightinvestheavilyintheabilitytomonitorthecostofproductionattheactivityandtasklevel(ActivityBasedCosting),butafinancialservicescompanymightchoosetoinvestintheabilitytomonitorcustomerperceptionsofservicequalityagainstcustomerexpectations(SERVQUAL).

AnITorganizationwithhighlydetailedprocessspecificationsandtheabilitytocollectdetailedprocessperformancemeasuresmightemploySixSigmatodrivevariationfromprocessexecution,buttheR&Dorganizationmightchoosealesssophisticatedprocessanalysisapproachbecauseofthedynamicandpurposefullyunstablenatureofitsenvironment.

BusinessProcessManagementisamanagementdiscipline.Itassumesthatorganizationalobjectivescanbeachievedthroughthefocusedmanagementofbusinessprocesses.Underthisassumption,itguidesorganizationsindevelopingprinciplesandpracticestomanageresources,butitdoesnotprescribeaspecificsetofframeworks,methodologies,ortools.Thesedecisionsarelefttoeachindividualorganizationandeachwillemployadifferentmix.Thisprinciplecanapplyeventodifferentfunctionalorganizationswithinthesameenterprise.

2.2.12 Technology plays a supporting role, not a leading role, in a Business Process Management implementation

ThepastdecadehasseenincredibleadvancementinthedevelopmentofsophisticatedsoftwareapplicationsdesignedtosupporttheBusinessProcessManagementdiscipline.Amongtheseapplicationsaretoolstoenable

BusinessProcessArchitectureandtheabilitytomodelbusinessprocesseswithinthecontextofanoverarchingEnterpriseArchitecture

BusinessProcessDesign,includingtheabilitytoeffectivelycommunicatedesigntovariedstakeholdergroupsandalsopromotedesignintoprocessexecutionengines

BusinessProcessExecutionandtheabilitytoautomatetheorchestrationofactivitiesbetweenhumansandinformationsystemsengagedinprocessexecution

BusinessProcessAnalysisandtheabilitytoautomateanalysispracticessuchasActivityBasedTiming,ActivityBasedCosting,andScenarioBasedSimulation

BusinessRulesManagementandtheabilitytomanagebusinessrulesindependentlyofthebusinessprocessestheyconstrain,therebypromotingoperationalagilityandflexibility

WebServiceDevelopment,ServiceOrientedArchitecture,andtheabilitytoreadilyproduceenterprisedatarequiredintheexecutionofbusinessprocesses

RoundTripFeedbackandtheabilitytoleverageprocess‐executionperformancedataforanalysis,andultimatelytoinfluencefutureprocessdesignandimplementation.

Copyright A

BPM


81

Asamanagementdisciplinethatresultsinimprovedbusinessperformance,BusinessProcessManagementispracticedthroughasetofinterconnectedmethodologiesthattogetherpromotethesoundengineeringandcontinuousoptimizationofbusinessprocesses.Peopleinspecializedroles,whomayormaynotemployspecializedtoolstoassistthemintheirpractice,executebusinessProcessManagementmethodologies.

ThekeytakeawayisthatBusinessProcessManagementisamanagementdisciplinepracticedbypeople.WhileitisentirelypossibleforBPMpractitionerstoengageBPMmethodologieswithoutsupportingtechnologies,investmentinBPMtechnologieswithoutanoverarchingsetofmethodologiesdoesnotmakesense.Inshort,

InformationtechnologiescanbeemployedtosupportBPMpractitionersintheexecutionofBPMmethodologies.

TheITfunctionisanenablerofBPMefforts,notaleader. BPMimplementationisnotanITprojectbutacoordinatedmodificationof

businessmanagementpracticesthatmaybeenhancedbytechnology.

WhilethepracticeofBPMwithasoundmethodologyandnosupportingtechnologiescanbeverysuccessful,aBPMeffortleadingwithtechnologyandnomethodologyisdoomedtofail.Thedecisiontoinvestintechnologyshouldbedrivenfromstrongbusinessrequirementsandadisciplinedapproachtodeterminingareturnoninvestment.ManyorganizationswilldecidetoinvestinBPMtechnologiestofurtherenhancealready‐successfulBPMimplementations.

Ofcourse,ifBPMtechnologiesareemployed,ITwillplayanimportantroleintechnicalassessment,architecturaldesign,physicaldeployment,andoperationalmaintenanceofBPMtechnologies.Still,investmentoftechnologyandtheroleofITshouldalwaysfollowsoundbusinessneed.

2.2.13 Implementation of Business Process Management is a Strategic Decision and requires strong executive sponsorship.

Aspresentedthusfar,afullscale(enterprise‐wideorlargeorganization‐wide)BusinessProcessManagementimplementationoftenrequirestheintroductionanddevelopmentof

NewdisciplinessuchasEnterpriseArchitecture,TransformationPlanning,PortfolioManagement,PerformanceManagement,andProcessChangeManagement

Newcapabilitiesthatleveragethesedisciplines,suchastheabilitytooptimizebusinessprocessdesigninalignmentwithstrategicobjectives,deploybusinessprocessesandprocessimprovementsintooperations,monitorprocessperformance,addressperformancebreaches,respondtoenvironmentalchange,andcapitalizeonopportunitiesforprocessimprovement

Copyright A

BPM


82

Newbusinessprocesses,roles,andtechnologiesdeployedspecificallytoengageunderneaththesecapabilitiesinthecoordinatedend‐to‐endmanagementofprocess.

Theend‐to‐endmanagementoflargenumbersofbusinessprocessesinaggregateandacrossorganizationalboundariesintroducesanewparadigm.Newrolesfocusedontheend‐to‐endmanagementofbusinessprocessesacrossfunctionalorganizationsmustinteractwithtraditionalfunctionally‐basedmanagersundernewgovernancestructures.Theseintroductionsfundamentallychangethewayorganizationsmakedecisionsandthewayinwhichresourcesareallocated.

Toeffectthistypeofchangeinanorganizationcantakeyearsandrequiresatremendousamountofplanning,discipline,andperseverance.Forthesereasons,thedecisiontoimplementafull‐scaleBusinessProcessManagementdisciplinemustbeastrategicdecision:itrequiresatop‐to‐bottomcommitmentfromtheorganization,fromexecutiveleadershipwhichdefinesandsupportsthepracticeofBPM,throughlineandfunctionalmanagerswhomustcollaboratewithprocessownersonthedesignandexecutionofbusinessprocesses,tooperationsstaffwhomustoftenworkinextendedandvirtualteamstoensurevaluedeliverytotheendcustomer.

ItisverycommonfororganizationstoattemptaBusinessProcessManagementimplementationfromagrassrootsoperationalorfunctionallevel,butexperiencehasshownthatwithoutfullorganizationalcommitment,thepracticeandbenefitsofBPMareunlikelytomature.WhileindividualcontributorsmaydevelopBPMskillsinagrassrootsmodel,withoutsupportingleadership,values,beliefs,andculture,BPMasacomprehensivemanagementdisciplineisunlikelytotakeholdinasuccessful,meaningfulway.Strongleadershipisperhapsmostcritical,sinceitistheorganization’sleaderswhomostinfluenceculture,setstructures,goals,andincentivesfortheorganization,andhavethenecessaryauthoritytomakechangesthatcreateanenvironmentprimedforsuccess.

Copyright A

BPM

P International

Chapter 3

Process Modeling

Copyright A

BPM

P InternationalChapter3.ProcessModeling

84

Foreword by Craig Le Clair, VP, Principal Analyst, Forrester Research

Someverylargeforcestodaywillpushprocessmodelinginnewdirections.Processmodeling,forexample,mustsupportemergingconsumer‐technology‐driven“outsidein”designapproachesandtakeastrongerroleincommunicatingtothebusiness,inverydifferentwaysthanbefore:thatis,withlessemphasisonprocessmapsandmoreonbusinessservicesandcapabilities.

Inaddition,datafromtheoutsideworld—fromsocialmedia,sensors,andmobilecapture,referredtoasbigdata—isnowgrowingatanexponentialpaceinvolumeandimportance.Combinedwithemerginganalytics,itwilltransformprocessesandthetoolsthatsupportthem.

Processmodelingmustalsoevolve,quickly,toaccommodatethegrowingimportanceofbigdataandanalyticsindrivingprocessesandatthesametimeprovideinnovativewaystoreducetheskillsgapforprocessanalysts,whichgrowsdaily.Forexample,althoughcompaniesusevariousapproachestotackleprocess‐improvementprojects,theyoftenendupwithdepartmentalprocessesthatdothesamethingasbefore—justbetterorfaster.Asaresult,thereisaneedtoshiftfromisolatedBPMimprovement‐focusedprojectstosustainablebusinesstransformationprograms,where—yes—processmodelingcanhelp.Withinthiscontext,afewtrendsstandout:

Process modeling will better connect strategy to real‐time execution for improved responsiveness.Foryears,BPMheldoutthepromiseof“roundtripping”—theabilitytocontinuouslymodel,design,execute,andimprovebusinessprocesses.Unfortunately,mostBPMsolutionshavefocusedheavilyontheexecutionsideoftheequation,givingminimalattentiontothestrategicside.Overthenextfewyears,processmodelingwillshiftthefocusofBPMsuitesfromdevelopmentandexecutiontoamoreintegratedbalancebetweenmonitoringandexecutingprocessstrategy.Tohelpcreatethisintegratedbalance,thenextgenerationofBPMsuiteswillconnectbusinessarchitecture—capabilitymodels,valuestreams,andstrategymaps—withreal‐timeprocessexecutiontohighlightandrecommendimprovementsforcriticalprocessperformancegaps.

Model‐based design must improve communication with business stakeholders.Althoughmostenterpriseshavesometooltomodelbusinessprocesses,businessstakeholdersarelimitedtousingVisioorasimplifiedmodelingtooltodefineanddocumentbusinessprocesses.Attheotherextreme,moresophisticatedorganizationsdeploybusinessprocessanalysistoolsthatprovideextensivefirepowerformodelingandanalyzingbusinessprocesses.Inbothscenarios,businessstakeholderscurrentlyrelyheavilyontechnicaldeveloperstoturnprocessmodelsintoexecutablesolutions.Lookingforward,model‐to‐executionenvironmentswillimproveusabilityandallowbusinessstakeholderstointegratewithinternalapplicationsandservices,withminimalsupportfromtraditionalapplicationdevelopmentteams.

Process modeling will treat data as a first‐class citizen of business processes.Today,mostbusinessprocessprofessionalsviewdataasagivenandpaylittleattentionto

Copyright A

BPM


85

owningormaintainingdataquality.However,inthefuture,masterdata’srolewillbecomethelinchpintodeliveringintegratedcustomerexperiencesacrossdifferentchannels,asthedisconnectbetweenprocessanddatabecomesathorninthesideofbusinessprocessprofessionalsdrivingcustomertransformationinitiatives.Theexplosionofbigdataandanalyticswillcreateanew“lighter”formofmodelingasorganizationsseekvaluefromagrowingnumberofdigitalandanalogsensors,socialmedia,financialsystems,emails,surveys,andcustomercallcenters—tonameafew.Newdata‐centered‐tooltidalwavesswellonthehorizon.Thesenewproductivitytoolswillbegintomodel“metadata”andbypasstraditionalprocessmodels.

Teams will increasingly use collaboration to tap business strategists, customer experience experts, process transformation gurus, and technologists.Likethesiloedprocessesinorganizations,groupsworkingontransformationareoftenorganizedinsmallsilosandscatteredacrosstheenterprise.WeroutinelyseeprocessexcellenceteamsworkinginbusinessoperationsusingLeanandSixSigmatoimproveortransformprocesses,whilemarketingteamsworkontransformingthecustomerexperienceandITprofessionalsarebusyputtinginBPMsuites.Eachofthesegroupshasmuchtooffer,buttheireffortsoftenproceedinisolation.By2015,companiesthatembracecollaborativeprocessmodelingwillcombinethebestoftheseeffortsintoonestrategicinitiative,andputexpertsintocentersofexcellencethroughouttheorganization.Theseintegrated,holisticteamswillalsoincludebusinessstrategistsandchange‐managementexpertstoincreasethechanceofprofound,lastingchange.

Business‐ready process modeling will abstract configuration from technical complexity.Technologiessupportingthebusiness,includingenterpriseapps,businessprocessmanagementsuites,dynamiccasemanagement,collaborationandmobileapps,arebecominginherentlyeasiertouseandmanage.Thisisdrivenbyimprovementsinend‐userinterfaces,aswellasbyconfigurationimprovementsthatpresentmoreintuitive(andincreasinglygraphical)set‐uptoolsthatabstracttechnicalcomplexity.Asmoresoftwarevendorsdeliverbusiness‐readytechnology,businessprocessstakeholderswillbecomelessdependentonITtoconfigureprocessesandunlocknewfeaturesoftheapplications.

Thisisagreattimetobeaprocessspecialist,whetheryouarepartofabusinessarchitectureteaminITorananalystsupportingthebusinessdirectly.Thedemandforyourskillsisgrowing,andthetoolstosupportyouwillmakeyoureffortsmorerewarding.

Copyright A

BPM


86

Contents

ForewordbyCraigLeClair,VP,PrincipalAnalyst,ForresterResearch.....................84

3.0 Introduction.............................................................................................................................88

3.1 BusinessProcessModeling................................................................................................88

3.1.1 Useofmodels..................................................................................................................88

3.1.2 ProcessComponentsandTools..............................................................................90

3.2 PurposeofProcessModeling............................................................................................91

3.2.1 Taskathanddrivesprocessmodeling.................................................................91

3.2.2 Processmodelingisameanstobusinessends................................................91

3.3 CommonlyUsedProcessModelingNotations...........................................................93

3.3.1 BusinessProcessModelandNotation(BPMN)2.0.........................................94

3.3.2 SwimLanes......................................................................................................................96

3.3.3 FlowCharting..................................................................................................................97

3.3.4 EventProcessChain(EPC).........................................................................................99

3.3.5 UnifiedModelingLanguage(UML).....................................................................102

3.3.6 IDEF..................................................................................................................................104

3.3.7 ValueStreamMapping..............................................................................................105

3.4 SpecializedApproachesinProcessModeling.........................................................106

3.4.1 ValueChain...................................................................................................................107

3.4.2 SIPOC...............................................................................................................................108

3.4.3 SystemDynamics........................................................................................................109

3.5 ProcessModelLevels........................................................................................................111

Assigningprocessinformation.............................................................................................111

Aligningprocessinformation................................................................................................111

Levelsvaryinnumberandname........................................................................................111

Bestpractice:businessmodelingstandards..................................................................111

3.5.1 AnExampleSetofModelLevels..........................................................................112

3.6 Bottom‐UpandTop‐DownModelingApproaches...............................................117

Bottom‐upmodelingprojects...............................................................................................117

Top‐downmodelingprojects................................................................................................117

Modelingapproachruleofthumb.......................................................................................118

Copyright A

BPM


87

3.7 CapturingProcessInformation,andModelingParticipants............................118

3.7.1 DirectObservation......................................................................................................118

3.7.2 Interviews.......................................................................................................................119

3.7.3 Survey/WrittenFeedback.......................................................................................119

3.7.4 Structuredworkshops..............................................................................................119

3.7.5 Web‐BasedConferencing........................................................................................119

3.7.6 ModelingParticipants..............................................................................................120

3.8 FrameworksandReferenceModels...........................................................................120

3.8.1 ModelingWithinaFramework............................................................................120

3.8.2 UsingaReferenceModel.........................................................................................121

3.9 ModelingTechniquesandTools...................................................................................121

3.9.1 DrawingToolsandReports....................................................................................122

3.9.2 ElectronicModelingandProjection...................................................................122

3.10 ProcessValidationandSimulation...........................................................................122

3.10.1 ProcessSimulationUses.......................................................................................122

3.10.2 SimulationToolsandEnvironments..............................................................123

3.10.3 TechnicalSimulation/LoadAnalysis...............................................................123

3.11 KeyConcepts......................................................................................................................123

Copyright A

BPM


88

3.0 Introduction

ProcessModelingrequiresacriticalsetofskillsandtechniquesthatenablepeopletounderstand,communicate,measure,andmanagetheprimarycomponentsofbusinessprocesses.Forenterprisesawareofthehighvalueoftheirbusinessprocesses,processmodelingisthefoundationalactivityformanagingtheenterprise.

3.1 Business Process Modeling

BusinessProcessModelingisthesetofactivitiesinvolvedincreatingrepresentationsofanexistingorproposedbusinessprocess.Itcanprovideanend‐to‐endperspectiveoraportionofanorganization’sprimary,supporting,ormanagementprocesses.

3.1.1 Use of models

Amodelreferstoasimplifiedrepresentationofathing,concept,oractivity.Modelscanbemathematical,graphical,physical,narrative,oracombinationofthese.Modelshaveawiderangeofapplicationsinbusinessenvironments,including

Organizing(structuring) Discovery(learning) Forecasting(predicting) Measuring(quantifying) Explaining(teaching,demonstration) Verification(validation) Control(constraints,objectives).

Businessprocessescanbeexpressedthroughmodelingatmanylevelsofdetail,rangingfromhighlyabstracttohighlydetailed.Afully‐developedbusinessprocessmodelwilltypicallyrepresentseveralperspectivesservingdifferentpurposes.

3.1.1.1 Process model contents

Aprocessmodelincludesiconsthatrepresentworkflow,dataflow,events,decisions,gateways,andotherelementsoftheprocessitself.Aprocessmodelcancontainillustrationsandinformationabout

Theicons(representingtheprocesselements)usedintheillustrations Therelationshipsamongtheicons Therelationshipsoftheiconstotheirenvironment Howtheiconsrepresentedbehaveorperform.

3.1.1.2 Identifying a process model

Whenlookingatabusiness“illustration,”usethefollowingtabletodecidewhetheryouarelookingataprocessmodeloraprocessdiagramorprocessmap.

Copyright A

BPM


89

3.1.1.3 Static vs. Dynamic Models

Using static models

Staticmodelsrepresentasinglestateofabusinessprocessorcertainelementsofabusinessprocess.Staticrepresentations

Establishbaselines Documentconfigurationstages Depictcertainfuturestatesbasedonassumptionsofgoalsorrisksofthe

process Managechange

Table3

Copyright A

BPM


90

Drivetheprocesstowardamoreadvancedlevelofmaturity.

3.1.1.4 Dynamic models

Modelsorsomeelementsofamodelcanbeconstructedwithdynamicfeatures.Examplesofdynamicmodelsincludethosethataredesignedtoallowinteractionwithauserorthosethatshowthedevelopmentofatrendovertime.

3.1.1.5 Dynamic modeling tools

Mosttop‐tiermodelingtoolsprovidedynamicinteractioncapabilities.Insomecases,themostbasicversionofamodelingtoolwillhavesimulationcapabilitiesappropriateformostmodelingprojects.Asamodelingprojectprogressesandrequiresmoredetailedanalysis,youmayneedmoreadvancedandevenautomatedsimulationcapabilities.Ifso,considerobtainingthecapabilitiesyouneedfromthevendorofthetoolyouareusing,orasanadd‐onfromapartneroftheoriginalvendor.

3.1.1.6 Combining static and dynamic models

Oftenamodelingeffortbenefitsfromamixtureofstaticanddynamicmodels.Forexample,whenconsideringafutureprocessconfiguration(the“To‐Be”process),byfeedingsampledatathroughadynamicprocessmodelyoucanseehowtheactualprocesswillperform.Conversely,cyclingofadynamicmodelcanproduceadesirablesetofstatic“snapshots”toaidinfurtheranalysis.

3.1.2 Process Components and Tools

3.1.2.1 Process modeling tools capture process components

Processcomponentsspecifytheproperties,behavior,purpose,andotherelementsofthebusinessprocess.Youcanusesomemodelingtoolstocaptureandcatalogueprocesscomponentsandtheinformationassociatedwitheachcomponenttoorganize,analyze,andmanageanorganization’sportfolio(i.e.,collection)ofprocesses.

3.1.2.2 Modeling tools capabilities

Modelingtoolsvaryinthenumberandtypesofcomponents(andinformation)theycancapture,whichaffectsthetypeandlevelofprocessperformanceanalysisyoucanperform.Processmodelingprojectsfrequentlygrowinscopeandcomplexity.Becauseofthis,selectingamorepowerfultoolthanrequiredatthebeginningofamodelingprojectoftenmakesthemostsense.

Examples of process components

Table4presentssomeprocesscomponents(andrelatedinformation)youcancaptureinprocessmodels.

Copyright A

BPM


91

ExamplesofProcessComponentsandDatainProcessModelsInputs/OutputsEvents/ResultsValueAddRoles/OrganizationsData/InformationProbabilitiesQueuingTransmissionTimeWaitTime

ArrivalPatterns/DistributionsCosts(indirectanddirect)EntryRulesExitRulesBranchingRulesJoinRulesWork/HandlingTimeBatchingServers(numberofperformersavailabletoperformtasks)

Table4.ExamplesofProcessComponentsandDatainProcessModels

3.2 Purpose of Process Modeling

3.2.1 Task at hand drives process modeling

Asaworkactivity,thepurposeofprocessmodelingistocreatearepresentationoftheprocessthatdescribesitaccuratelyandsufficientlyforthetaskathand.Forthisreason,thelevelofdetailtomodelandthespecifictypeofmodelisbasedonwhatisexpectedfromthemodelingproject.Asimplediagrammaysufficeforoneproject,whileafullydevelopedmodelmayberequiredforanother.

3.2.2 Process modeling is a means to business ends

Processmodelsarethemeansto

Manageorganizationprocesses Analyzeprocessperformance Definechanges.

Processmodelscanexpressatargetbusinessstateorspecifytherequirementsforresourcestoenableeffectivebusinessoperations,suchaspeople,information,facilities,automation,finance,andenergy.

Thefollowingtableoutlines,fromdifferentpointsofview,somereasonsforprocessmodeling.

Copyright A

BPM


92

PointofView ReasonsforProcessModeling

Businesscommunity Savemoney—cutcosts Improvequality—reducewaste Reducetimetoproduction Increaseproductivity Reducetimeforordertodelivery—customersatisfaction Targetproblemstofixthoseproblems Captureperformerknowledge—avoidprocessbreakdown Standardizeemployeeperformance

Businessprocessprofessional

Solvesabusinessproblemby o Describingtheprocessasaccuratelyandsufficientlyas

necessaryforthetaskathand o Communicatingtheprocessclearlytotheintended

audience o Selectingthelevelofdetailandthespecifictypeof

modeldependinguponwhatisexpectedofthemodelingprojectandthebusinessproblemthatneedsfixing

Organizational Processmodelsarethemeanstoo Managetheorganization’sprocesses o Analyzeprocessperformance o Definechanges

Processmodelscano Expressatargetbusinessstate o Specifyrequirementsforresourcestoenableeffective

operations(e.g.,people,information,facilities,automation,finance,orenergy)

Analysisandperformanceimprovement

Increaseclarityorunderstandingofaprocess Aidintraining Assessperformanceagainststandardsandcompliance

requirements Understandprocessperformanceundervaryingloadsorother

changes Analyzepotentialopportunitiesforimprovement Designanewprocessoranewapproachtoexistingprocess Facilitatecommunicationanddiscussion Documentarequirementsdeterminationeffort

Process‐managedbusiness

Centralstartingpointtodrivecollectiveunderstandingandconsensusamongprocessstakeholders

Savecosts,timeandeffortoverguessworkandexperimentationwiththeactualprocesses

Helpprocessperformersfromadepartmentseehowtheirinputsandoutputsaffectthedevelopmentofvalueacrossfunctionallines

Mayresultinlocaldecisionmakingthatmaximizesvalueintheprocessratherthanproducinglocaloptimization

Table5.ReasonsforProcessModeling

Copyright A

BPM


93

3.3 Commonly Used Process Modeling Notations

Anotationis‐‐Astandardizedsetofsymbolsandrulesthatgovernhowthesymbolsrepresentsomethingelse.

Forexample,musicalnotationincludesuniversallyrecognizedsymbolsfornotesandclefs.Similarly,abusinessprocessmodelingnotationincludesicons(pictures)andconnectorsthathelpshowrelationshipsamongthevariousreal‐lifecomponentsofabusinessprocess.

Thereareanumberofmodelingandnotationalstandardsandtechniquesinusetoday.Selectingthebestapproachfromtheavailableoptionscanbedifficult;however,selectinganapproachthatfollowsstandardsandwell‐knownconventionsprovidesfar‐reachingadvantages,aslistedinTable6.

BenefitstoUsingaStandardModelingNotation

Membersofthebusinesscommunity,businessprocessprofessionals,andITprofessionalshaveacommonsymbolset,language,andtechniquethroughwhichtocommunicate.

Resultingprocessmodelsareconsistentinformandmeaningwhichsimplifiesdesign,analysis,andmeasurementwhileenablingmodelre‐use.

Staffcanimportandexportprocessmodelsamongvarioustools. Withsometools,staffcantransformthemodelingnotationintoanexecution

language. Thereisasignificantgrowthtrendinsomeofthesefeatures,notablythe

importfacilityandcompatibilitywithexecutionengines.

Table6.BenefitstoUsingaStandardModelingNotation

Guidelines for selecting a modeling notation

Thissectionprovidesabriefdescriptionofsomeofthemostcommonlyencounteredmodelingnotations.Notethattheexamplesprovidedarejustthegraphicalveneerofthenotationalsystemspresented.Inmodernmodelingenvironments,theremaybemanylevelsanddetailedattributesthathelptomorefullydescribeabusinessprocess.

Whenchoosingamodelingnotation,considertheuniquecombinationofcircumstancesinyourorganization.ReviewthemodelingnotationsinTable7tohelpmaketheselection.Andkeepinminditissometimesappropriatetousedifferentnotationsfordifferentstagesofamodelingprojectorfordifferentlevelsortypesofmodels.

Copyright A

BPM


94

CommonlyUsedProcessModelingNotations

ModelingNotation Description

BusinessProcessModelandNotation(BPMN)2.0

StandardcreatedbytheObjectManagementGroup;103icons,usefulforpresentingamodeltomultipleaudiences

SwimLanes Notadistinctnotation,butanadditiontomostothernotationsystems;helpsidentifyhand‐offsinaprocess

FlowChartingOriginallyapprovedasanANSIstandard,includesaverysimpleandsmallsetofsymbolsthatarenotstandardized;facilitates“quickcapture”ofprocessflow

EventProcessChain(EPC)

DevelopedwithintheframeworkofARIS,considerseventsastriggerstoorresultsfromaprocessstep;usefulformodelingcomplexsetsofprocesses

UnifiedModelingLanguage(UML)

MaintainedbytheObjectManagementGroup,astandardsetofdiagrammingtechniques,notationsprimarilyfordescribinginformationsystemsrequirements

IntegratedDefinitionLanguage(IDEF)

AFederalInformationProcessingStandardthathighlightstheinputs,outputs,mechanisms,andcontrolsofaprocess,andclearlylinksprocessesupanddownlevelsofdetail;goodstartingplaceforanenterprise‐wideviewofanorganization

ValueStreamMappingFromLeanManufacturing,averysimplesetofsymbols;usedtoaddprocessresourcecostsandtimeelementstoaprocessmodeltoclearlydepictprocessefficiency

Table7.CommonlyUsedProcessModelingNotations

3.3.1 Business Process Model and Notation (BPMN) 2.0

BusinessProcessModelandNotation2.0isastandardcreatedbytheBusinessProcessManagementInitiative,nowmergedwiththeObjectManagementGroup(OMG),aninformationsystemsstandards‐settinggroup.BPMNhasgrowingacceptanceasastandardfrommanyperspectives,whichhasresultedinitsinclusioninseveralofthemostwidelyusedmodelingtools.Itprovidesarobustsymbolsetformodelingdifferentaspectsofbusinessprocesses.Likemostmodernnotations,thesymbolsdescribedefiniterelationshipssuchasworkflowandorderofprecedence.

Copyright A

BPM


95

Key features

Version2(BPMN2.0)representssignificantmaturingandsolidificationofthenotation

Over100totalicons,organizedintodescriptiveandanalyticsetstomeetdifferentuserneeds

Veryprecisenotationindicating:beginning,intermediate,andendevents;activities,andmessageflows;intra‐businesscommunicationsandinter‐businesscollaboration;andactivityanddataflows.

When to use

Topresentamodelofaprocesstomultiplesetsofaudiences Tosimulateabusinessprocesswithaprocessengine Toexecuteaprocess.

Advantages

Widespreaduseandunderstanding;consideredbymanytobethedefactostandardintheU.S.

SignificantuseintheU.S.DepartmentofDefenseandothergovernmententities

Oneofthemostpowerfulandversatilenotationsforidentifyingprocessconstraints.

Disadvantages

Requirestrainingandexperiencetousefullsetofsymbolscorrectly Difficulttoseerelationshipsamongmultiplelevelsofaprocess Differentmodelingtoolsmaysupportdifferentsub‐setsofthenotation InformationTechnologyoriginsinhibitusewithsomeorganizations’

membersofthebusinesscommunity.

Start event

Induct materialcomponents

Typical task object

Assemblecomponents

Connectors describe sequence

Test product

Test Passed?

No

Ship to customerYes

Process Failure

Process Success

End Event

Shippingdocuments

Copyright A

BPM


96

Example

Figure26.SimpleBPMNProcessDiagram

For more information:

TheObjectManagementgroup’sdedicatedwebsiteathttp://www.bpmn.org/

Helpfilesandsamplemodelsinmostmajormodelingtools.

3.3.2 Swim Lanes

Swimlanesarenotadistinctnotationbutratherausefulnotationaladditiontomostothernotationsystems.TheyareoftenincorporatedintoBPMN,EPC,UML,orsimpleflowchartingasameansofdefiningtheperformerresponsibleforperforminganactivity.Thelanes(rows)aregenerallyrepresentedaslongverticalorhorizontalrectanglesorsometimesassimplelinesorbars,resemblingthechannelorlanemarkingsinswimmingcompetitions.Arrangingtheflowofactivitiesandtasksacrosstheserowsmakesiteasytovisualizehandoffsinthework.

Key features

Thelanesrepresentperformersorcombinationsofperformers Lanescouldindicateroles,organizations,systems,oranyotherperformer

entityorcombination.

Copyright A

BPM


97

When to use

Toclearlydistinguishatwhatpointtheresponsibilityforperformancechanges

Toincreaseunderstandingamongprocessstakeholders.

Advantages

Aidscollaborationasprocessperformersareabletodistinguishtheirrolesinrelationtoothers

Clearlydefineshand‐offpointsinaprocess Candescribeflowsofoperationalprecedence,material,andmessages.

Disadvantages

Becomescomplexinareaswhereperformanceresponsibilityisjointlyheld Incertaincases,canpreserveasiloprocessmindset.

Example (used in BPMN) of one “pool” and three lanes

Figure27.Traditionalswimlanediagram.(ProvidedbyBruceSilver,withpermissionfromtheauthor.)


http://www.agilemodeling.com/style/activityDiagram.htm#Swimlanes Helpfilesformostmajormodelingenvironments

3.3.3 Flow Charting

Flowchartingiswidelyused;itisbaseduponasimplesetofsymbolsforoperations,decisions,andotherprimaryprocesselements.ThenotationforthemostcommonflowchartingwasapprovedasanANSIstandardin1970forrepresentingsystemsflows.Otherflow‐chartingnotationshavebeenusedbyindustrialengineersfordecadesandutilizedifferentsymbolsandlayoutsforspecificindustrialmappings.

Copyright A

BPM


98

Forexample,flowchartingisusedtodescribetheflowofmaterials,rolesandwork,orplacementofmachinery,analysisofegressandingressindispatchcenters.

Key features

Usedwithorwithoutswimlanes Manyvariationsfordifferentpurposes Simplecoresetofeasilyrecognizedsymbols Forerunnerofmanymoremodernnotations.

When to use

Toquicklycaptureprocessflowforsharingwheredetailsdonotrequiredocumenting

Tobeginamodelingprojectwherefundingisnotavailableforfull‐featuredtools

Todevelophighlydetaileddiagramsforuseintraditionalsystemcoding.

Advantages

Wellunderstoodbysoftwareengineersandsystemsengineers Athighlevels,helpsbuildconsensus Adequatefor“happypath”illustrations Inexpensivetouse Supportedbylower‐ordertoolsincludinggeneral‐purposegraphicsand

visualizationtools.

Disadvantages

DespiteinfluencefromANSIstandards,therearemanyvariations Maybeimprecisewhenusedtodepictcomplexbusinessprocesses Objectsdonothaverobustsetofdescriptiveattributes Modelsconstructedare“flat,”requiringtheuseofconnectorsymbolsto

showwhereprocesssegmentscontinue Notgenerallyconsideredrobustenoughforcomplexprocesscapture.

Examples (showing a few of the most commonly used symbols)

Twoexamplesareprovidedbelowtoillustratehowmuchflow‐chartingsymbolscanvaryinappearancefromoneorganizationtoanother.

Copyright A

BPM


99

Figure28

Figure29


ApplicableANSIstandards Introductorycomputerprogrammingcoursetexts

3.3.4 Event Process Chain (EPC)

EventProcessChainsrangefromverysimpletoverycomplex.EPCdescribeseventsaseithertriggeringorresultingfromaprocessstep,calleda“function.”Thus,theflowisnormallyevent‐function‐event.EPCreliesheavilyuponlogicaloperatorscalled“rules.”Thebasicruleobjectsare“AND,”“OR,”and“ExclusiveOR.”Theseruleobjectsexpressdecisions,tests,parallelism,andconvergenceintheprocessflow.A

Copyright A

BPM


100

simpleEPCconsistsofjusttheseobjectsplusarrowsthatdefinerelationshipsbetweenthem.

Key features

TheEPCmethodwasdevelopedwithintheframeworkofARISbyProf.Wilhelm‐AugustScheerattheUniversitätdesSaarlandesintheearly1990s

Itcanbeusedformodeling,analyzing,andre‐designingbusinessprocesses Maybeenhancedwithverticalorhorizontalswimlanes Simplecoresetofeasily‐recognizedsymbols,augmentedwithalarge

numberofoptionalorspecial‐purposeobjects Sometoolsemployasystemoffilterstolimitorcontrolthesubsetofthe

notationtobeused.

When to use

Modelingcomplexsetsofprocesseswithmanyprocessinterfacesandsub‐models

Tofillindetailsofprocessesbelowthelevelsnormallyaddressedbysomeenterprisearchitectureframeworks

Advantages

WidelyusedandunderstoodinGermanyandotherEuropeancountries,especiallyinmultinationalenterprises

SubstantialpresenceintheU.S.DepartmentofDefenseandotherlargeenterprises

AproperlyconstructedEPCmaybereadlikeasetofsentences Maybeusedasameansofcollaborationamonggroupsoffunctionalexperts

whohavelittleexperiencewithmodels Possibletoenhancethemodelsthroughtheuseofmanyoptionalobject

typesthatdescribeperformers,supportingsystems,information,orswimlanesofrelatedactivity

SometoolsmaytranslatebetweenEPCandBPMNnotationswithgrowingreliability

Oneofthemostpowerfulandversatileforidentificationofprocessconstraints.

Disadvantages

LessprevalentthanBPMNandFlowChartinginU.S.modelingprojects Modelingteamsmustbedisciplinedintheuseofthenotationtoavoid

possiblelogicgaps StrongestimplementationislimitedtotheARISfamilyofprocessmodeling

tools.

Copyright A

BPM


101

Example

Figure30.EventProcessChain(1)

Copyright A

BPM


102

Figure31.EventProcessChain(2)

Formoreinformation:

http://www.ariscommunity.com/ http://www.softwareag.com/corporate/products/aris_platform/modeling/

default.asp

3.3.5 Unified Modeling Language (UML)

UMLprovidesastandardsetofdiagrammingtechniquesandnotationsprimarilyfordescribinginformationsystemsrequirements.WhileUMLisprimarilyusedforsystemsanalysisanddesign,afeworganizationsalsouseUMLactivitydiagramsforbusinessprocessmodeling.UMLismaintainedbytheObjectManagementGroup(OMG),astandards‐settingbodyfortheinformationsystemsfield.

Key features

Actuallyasetofnineormorerelateddiagrammingtechniquesandnotations Describesverycomplexlateralandparent‐childrelationships Symbolsetvariessomewhatdependingonmodeltype

Copyright A

BPM


103

Animportantsubset,SysML,oftenusedtodescribesystemsandsystemsofsystems.

When to use

Todevelopusecases Todescribeinformationsystemsrequirements Todesignsysteminteractionsbelowtheleveloftheprocessflowsdepicted

inothertools Tocaptureordesigndatastructures Mayalsobeusedtodepictbusinessprocessflowsatalowerlevel Oftenusedtopresent‘use’cases.

Advantages

Well‐establishedcommunityofusers Implementedinmostmajormodelingenvironments Manyreferencesavailablefrombooksandonlinesources.

Disadvantages

Designedformodelingsoftwareapplications;businessprocessmodelingisasecondaryuse

Notationalrepresentationmayvaryfromtooltotool

Example

(SeeFigure32below)

Figure32.Source:

http://www.gentleware.com/fileadmin/media/archives/userguides/poseidon_users_guide/activitydiagram.html

Copyright A

BPM


104


ObjectManagementGroupmaintainsacompletespecificationforthisnotationathttp://www.uml.orgaswellaslinkstootherusefulinformation

HelpfilestructureinIBMRationalsoftware.

3.3.6 IDEF

IDEFisafamilyofmodelingnotationconceptsthataredescribedinaFederalInformationProcessingStandard(FIPS)thatwasdevelopedbytheUSAirForce.Itisanotationandtechniquethatisonepartofamethodologyfordefiningtheworkprocessesandinformationsystemsinmanufacturingenvironments.Itwaswidelyusedandavailableinmanymodelingtoolsformanyyearsandisnowinthepublicdomain.

Thenotationemploysaverysimplesetofsymbolsconsistingofprocessboxeswitharrowsshowinginputs,outputs,controls,andmechanisms.Althougheachlevelofthemodelisreadlefttorightandtoptobottom,thenumberingsystemusedforthemajorstepsarerepresentedinawaythatallowsforeasyassociationbetweenparentandchildlevelsofdecompositionintheprocess.Thus,achildprocessboxnamedA1.3isinterpretedtobeachildprocessoftheparentdiagramA1.Eachsuccessivelevelofdecompositionusesanotherdecimalpointtocontinuethiseasytraceabilityoflineage.

Key features

Topleveldefinesthetopictobemodeled Subsequentlevelsdisplaydecompositionofthelevelabovewithaseriesof

boxes Stepsintheprocesshaveinputs,outputs,controlsandmechanismsdepicted

bylabeledarrows Systemoflabelingindicatesexactrelationshipwithnextlevelabove(B32is

thesecondprocesssub‐stepoftheB3processstep).

When to use

Maybeusedforanylevelofactivitymodeling IntegratedComputerAidedManufacturing(ICAM).

Advantages

Preciseexpression Easy‐to‐followlogicaldecompositionofmodellevels ExhaustivedocumentationavailablefromU.S.Federalgovernmentor

commercialsources.

Disadvantages

Implementationsareoftenvisuallyunappealing Notationconsistingmainlyofboxesandarrowscanappearclutteredand

busy.

Copyright A

BPM


105

Example

Figure33.IDEFSampleDiagram

For more information

DraftFederalInformationProcessingStandardsPublication183 ComputerAssociatesBPWinproductdescription.

3.3.7 Value Stream Mapping

ValueStreamMappingisatechniqueusedinLeanManufacturing.NottobeconfusedwithValueChainnotation,ValueStreamMappingexpressesthephysicalenvironmentandflowofmaterialsandproductsinamanufacturingenvironment.AtToyota,wherethetechniqueoriginated,itisknownas"MaterialandInformationFlowMapping."ValueStreamMappingisusedtoaddprocessresourcecostsandtimeelementstoaprocessmodel,toincorporatetheviewoftheprocessefficiency.

Key features

Verysimplesetofsymbols Mayincorporatediagrammingfromothernotations.

When to use

Toincreaseinvolvementofprocessperformersinprocessanalysis Tohelpguideperformersinself‐identifyingopportunitiestoleanaprocess Inanyprojectthatdoesnotrequiretheuseoffull‐featuredmodeling

environments Inenvironmentswhereprocesscostsandtimerequirementsareeasily

identified.

Advantages

Simple,easytouse

Disadvantages

Flatmodels Norepository

Copyright A

BPM


106

Unabletouseforverycomplexissues

Example

(SeeFigure34below)

Figure34.ValueStreamMappingSampleDiagram(ReprintedfromLSixSigmapublication)


MostLeanandSixSigmatexts

3.4 Specialized Approaches in Process Modeling

Thefollowingthreeapproachescanbeusedinprocessmodelingorprocessimprovementinitiatives.Theyareconsideredspecializedapproaches,eachprovidinganenterpriseperspectiveanalysis.Furtherdetailandsamplematerialsareavailablefromthewebsitesforeachapproach,listedbelow.

SpecializedApproachesinProcessModeling

ModelingNotation Description

ValueChain IntroducedbyMichaelPorter,thisnotationemphasizescapturingthoseprocessesandactivitiesthat“addvalue”totheserviceorproductprovidedtoacustomer.Providesanoverviewbutnotdetailedviewofbusinessprocesses.

Supplier,Input,Process,Output,andCustomer(SIPOC)

AstyleofprocessdocumentationusedinSixSigma,usefultoemphasizethesourcesofinputs(suppliers)andthetargetsoftheoutputs(customer).

SystemDynamics SystemsDynamicmodelspresentadynamicviewofabusinesssystem’sperformance.

Copyright A

BPM


107

Table8.SpecializedApproachesinProcessModeling

3.4.1 Value Chain

Valuechainnotationsareacategoryofsymbolsetsusedtovisualizetheaccumulationofvalueorstepstowardachievementofagoal.Variousapproachestovaluechainsemploytheirownsetsofsymbols,butthesearegenerallyeasilyinterpretedandoftenemployanarroworhorizontalchevrontoexpresseachstepinthechain.Relationshipsarealsogenerallyeasytounderstand,withthechiefonedescribingapredecessor‐successorrelationship.

Sometimesgroupsofstepsaresummarizedundera“processsuperior”object.Thesemodelsgenerallyflowfromlefttoright,describingthesub‐processesthatdirectlycontributetoproducingvaluefortheorganization’scustomers(clientsorconstituents).TheconceptofthevaluechainwasintroducedbyMichaelPorterinhisworksoncorporatestrategyandistypicallyappliedattheenterprisemodelingandplanninglevel.

Key features

Featuresvaryamongtools:

SometimesimplementedasValue‐AddedChainDiagram Overlaysrepresentingperformers,finance,time,systems,orspecificdata

clustersmaybeadded Swimlanesmaybeusedtoenhanceeffectiveness

When to use

Tocreateadecompositionofthoseprocesssegmentsthatrelatemostdirectlytoaddingcustomervalue

Todepictoverviewlevelsofprocesses

Advantages

Easytoreadandinterpret Littleambiguitybecauseofsimplerelationships Maybeaugmentedwithoptionalinputandoutputidentification,orother

overlayssuchasfinancialororganizationalinvolvement

Disadvantages

Decisionpointsunclear Usefulnessbreaksdownwithincreasedcomplexity,requiringuseofmore

detailednotationsforfurtherdecomposition

Copyright A

BPM


108

Example

Figure35.AValueChaindiagram


AValueChainReferenceModelhasbeenproposedbyTheValueChainGroup,Inc.athttp://www.value‐chain.org/en/rel/19/

AstrongValue‐AddedChainDiagramimplementationisincludedinmodelingtoolsfromSoftwareAG(ARIS).

3.4.2 SIPOC

SIPOCstandsforSupplier,Input,Process,Output,andCustomer.ItisastyleofprocessdocumentationusedinSixSigma.Thereisnostandardorpreferrednotationsetandthistechniquemaybesatisfiedbycompletingatablewiththoseheadings.TheSIPOCmodelisoftenusedtogainaninitialconsensusonwhatareasofaprocessareunderstudy.

Key features

Simplecolumnararrangement(notswimlanes) Textentriesorwell‐understoodnotationalelementsmaybeusedtopopulate

thecolumns

When to use

UsedextensivelyattheonsetofLeanandSixSigmaprojects Theexerciseofnamingtheentitiesineachcolumncanacceleratedetailed

modelinginanothertool Useforinitialconsensus‐buildingofprocessmodelingprojectscope.

Advantages

Fast Simple Requiresonlyatemplateinaspreadsheetorwordprocessingdocument

Major ProcessSegment

Process Step 1

Process Superior Relationship

Process Step 2aProcess Predecessor

Relationship

Step 2b

Process Step 3

Copyright A

BPM


109

Disadvantages

Littlepotentialforin‐depthcapture,design,oranalysis Maydelaytheadoptionofamorepowerfulmethod

Example

Figure36.SIPOCWorksheet


http://www.isixsigma.com

3.4.3 System Dynamics

Morethanjustadifferentnotation,SystemDynamicsmodelsare“activityonarrow”diagramsratherthan“activityonnode”diagramslikemostoftheothernotations.SystemDynamicsmodelsareespeciallyusefulindevelopingdynamiclifecycle‐typemodelsthatfocusontheoverallbusinesssystem’sperformanceandtheimpactofchangingthekeyvariablesthataffectoverallperformance.Thesearemoreoftenusedtomodelanentireenterpriseorlineofbusinessratherthanlower‐levelworkflowtypemodels.SystemDynamicsmodelsareoftenusedtodescribetheenterprisebusiness“architecture”fromadynamicbehavioralperspective,ratherthanastaticstructuralperspective.

Key features

Causalandfeedbackloopdiagrams Dynamic—viacontrolledanimationdemonstrateshowprocessperforms

Copyright A

BPM


110

When to use

Toprovidea“macroview,”simulatinganorganization’soverallperformance Tocompareimpactsofchangingmultiplevariablesonaprocessoran

organization.

Advantages

Presentsactive,moving,fluctuatingrepresentationofahigh‐levelprocess Easiertounderstandthanastaticrepresentationortextdescription.

Disadvantages

Notusefulfordiscerningproblemsattheworkerlevelorwithsupportingcomputerapplications

Notusefulfordiscerninginfluencesexternaltoaprocessuponthatprocess

Example

Thefollowingisonlya“snapshot”fromaSystemDynamicsmodel.AnactualSystemDynamicsmodelisnotstatic,butshowswithmovementhowchangingvariablesaffectaprocess.

Figure37


SystemDynamicsSociety:http://www.systemdynamics.org/

Copyright A

BPM


111

SystemDynamics—MITSloanPhDProgram:http://mitsloan.mit.edu/phd/system‐dynamics.php

TheSystemDynamicsReview,thejournaloftheSystemDynamicsSociety:http://www.systemdynamics.org/publications.htm

3.5 Process Model Levels

Assigning process information

Processinformationdiscoveryuncoversinformationatvariouslevelsofdetail.Theselevelsofdetailneedtobesortedoutandtheinformationassignedtothedifferentlevelsofprocesseswithinaprocessmodelhierarchy.Thetoplevelofthehierarchyshowstheend‐to‐endprocess.Fromthereitisbrokendown(decomposed)intolowerlevelsofdetailuntiltheactivitieswherethe“work”oftheprocessisperformedareidentified.

Aligning process information

Whencollectingprocessinformation,considerassigningprocessinformationtotheappropriateprocesslevelastheinformationiscollected.Astheteamlearnsmoreabouttheprocess,theprocessinformationcanbere‐assigned.Besuretoaligntheinformationatanylevelinthehierarchytoinformationatahigherlevelinthehierarchy.Bydoingthis,theinformationateachlevelprovidesadditionaldetailtotheinformationatthenexthigherlevel.Additionally,aligningprocessinformationacrossprocesslevelsallowstheteamtoidentifymissinginformationorinformationthatneedstobequestioned.

Thediagrambelowisanexampleofaprocesshierarchy,startingatthehighest,leastdetailedlevel,theEnterpriseProcesslevel,and“drillingdown”totheBusinessProcesslevelandWorkflowlevel.

Levels vary in number and name

Thenumberoflevelsandtheirnameswillvaryaccordingtothemethodsandnamingconventionsindifferentcompanies.Keypointstoremember:

Theprocessmustbebrokenintoalowenoughleveltounderstandtheactivitiesthataretakingplaceandhowtheyfittogethertoproducethebusinessunit’sendproducts.

Ifthereistobeanyhopeofcontrollingtheprocessinformationanditsquality,theteamneedsawaytoorganizetheinformationthatiscollectedandthemodelsthatarebuilt.

Thelevelsinthefigurebelowareanexampleofhowacompanycanlookatdefininglevelsofdetailintheirprocessmodelingstandards.

Best practice: business modeling standards

Formalbusinessmodelingstandardsshoulddirectthenumberandnameofthelevelsinboththecurrent“AsIs”andthefuture“ToBe”models.Inthepast,these

Copyright A

BPM


112

standardscouldbeindependentofanyexternalmodelingstandardortool,butthatischanging.Consideraligninginternalmodelingstandardswiththetoolsthatareusedandtheircapabilitiesandlimitations.Forexample,whileitisnottheonlymodelingstandard,BPMN2.0isbecomingamajorstandardforBPMS(businessprocessmanagementsuite)vendors.Consequently,anorganization’sinternalmodelingstandardsmayneedtoconformtoBPMN.Agoodruleofthumbinlookingatmodelingstandardsistohavethemaddressinsomewayatleastthelevelsshownintheexamplediagram.

Figure38.AnExampleofProcessModelLevels

3.5.1 An Example Set of Model Levels

Processescanbemodeledfrommanyperspectives,orpointsofview,accordingtotheneedsoftheorganization.Processmodelinghasbeenusedforstrategicplanning,improvingoperations,andspecifyingdataandapplicationssystemrequirementsformanyyears.

Copyright A

BPM


113

Integrating process models

Theadventofprocess‐focusedmanagementdisciplinescreatedtheneedtodevelopmodelsthatintegratethesedifferentperspectives.InaBPMenvironment,anorganization’sstrategyisenactedthroughprocessperformance.Processperformancelinkstheenterpriseandbusinessprocessmodelstotheworkflow(oroperations)model,whichpresentsWHATmustbedonetoprovidetheinternalorexternalcustomerwithaproductorservice.Theworkflowmodelinturnlinkstothetasksteps—whichdescribeHOWtheworkisdone.Andthetasksteps,inturn,mustbesupportedbytheinformationtechnologysystems.

Process repository maintains alignment

Tokeepthesetypesofmodelsaligned,alineofvisibilityisneededfromonetypeofmodelandperspectivetothenextinacoherentframework,typicallymaintainedinaprocessrepository.Table9liststhedifferentperspectivesthataprocessrepositorycanmaintain.

Table9

3.5.1.1 Enterprise Process Models

Enterprise perspective

Themembersofanorganizationwhoneedtoseehowtheenterpriseoperatesoverall,andalignoverallenterprisestrategywithaggregatedprocessperformancetakean“enterpriseperspective”orpointofview.Theenterpriseperspectivearrangestheprimaryprocessestoprovideasenseoftheirinteractionand

ThisPosition

IsAccountablefor

TakesthisPointofView

UsesthisLevelofModel

Madeupof

ExecutiveManagement

AligningStrategywithEnterpriseProcessPerformance

EnterprisePerspective

EnterpriseProcessModel

Processesandsub‐processes

ProcessOwner

BusinessProcessPerformance

BusinessPerspective

BusinessProcessModel

Sub‐processesandactivities

OperationsManager&Staff

OverseeingandDoingtheWork

OperationalPerspective

WorkflowModel

Activities

Copyright A

BPM


114

integration.Theenterprisepointofviewiscaptured,foreachorganization,inanEnterpriseProcessModel.

Enterprise Models

AnEnterpriseProcessModelprovidesafullend‐to‐end,high‐levelviewoftheprocess.Themodelcanshowsub‐processesaswellashigh‐levelproblemsandapplicationsystems.AnEnterpriseProcessModelistypicallyaverygeneralmodelthatdescribesthefocusofanorganizationandarrangesthemajorprocessesoftheentireorganization.

Enterprise Process Model components

Generally,eachhigh‐levelbusinessprocessisdescribedinmoredetailbyitsmajorcomponents(sub‐processes).Anenterprisemodeltypicallyhastwoormorelevelsofdetailandservesasahigh‐levelorganizational“blueprint.”TheEnterpriseProcessModelmayormaynotincludesupportandmanagementprocesses.

Additional Use for Enterprise Process Models

Thesemodelshaveusesotherthanasageneralclassificationandcommunicationstool.Theprocessescanbe

MappedtoKeyPerformanceIndicators(KPIs)andstrategicgoalsinaprocessportfolio

Usedtoprioritizeresourcesandprojectefforts,and MappedintoaSystemDynamics‐typemodeltoformulatestrategiesfor

alternatefuturescenariosortodevelophigh‐levelestimatesandforecasts.

Use of process model frameworks

Someenterpriseprocessmodelingprojectsstartbyusingoneormoreprocessmodelframeworkstocreatea“strawenterprisemodel.”The“strawenterpriseprocessmodel”providesaspringboardforvettingorchangingbyexecutivemanagement.Conversely,someenterpriseprocessmodelingprojectsbeginwiththeexecutiveandfunctionalmanagement’spointofviewandthenbenchmarktheenterpriseprocessmodelagainsttheprocessmodelframeworks.

Process model framework examples

Examplesofprocessmodelframeworksinclude

Simplemulti‐levelorpyramidframework TheAPQCProcessClassificationFramework Porter’svaluechain Industry‐specificframeworkssuchasthoseintheenergydistribution,oiland

gasproduction,telecommunications,andinsuranceindustries.

Copyright A

BPM


115

Frameworks categorize and group processes

Theseframeworkstypicallycategorizeprocessesasprimary,support,andmanagement.Eachofthesecategoriesmaybeusedtogroupthemajorprocessesofthebusiness.Examplesofframeworksgroupingprimaryprocessesinclude:

InPorter’svaluechain,theprimaryprocessesareInboundLogistics,Operations,OutboundLogistics,MarketingandSales,andAfter‐SalesService.

IntheAPQCProcessClassificationFramework,theprimary(Operations)processesareDevelopVisionandStrategy(1.0),Design&DevelopProductsandServices(2.0),MarketandSellProductsandServices(3.0),DeliverProducts&Services(4.0),andManageCustomerService(5.0).

Inamorecustomer‐orientedservicesmodel,theprimarybusinessprocessescanbeEngageCustomers,TransactBusiness,FulfillCustomerExpectations,andServiceCustomers.

Processmodelframeworksandarchitecturearefurtherpresentedinchapter9,“EnterpriseProcessManagement.”

3.5.1.2 Business Process Models

The “process owner’s” point of view

Eachbusinessprocesshasaprocess‘owner’whoisaccountablefortheprocess’sperformanceandhastheauthoritytoaddorremoveresourcesthataffecttheperformanceoftheprocess.Thebusinessperspective,usedbytheprocessowner

Providesthebusinesscontext, Describesthebusinessprocess,and Definesthescopeofthebusinessprocessforanalysisandimplementing

changes.

Thebusinessperspectiveiscapturedinbusinessprocessmodels.

End‐to‐end primary, support, and management processes

Businessprocessmodelsbuiltfromthebusinessperspective

Depictthemajorevents,activities,andresultsforeachofthemajorend‐to‐endprocesses,theirsub‐processes,andtheirinteractionswiththeirenvironment.

Typicallyalsodescribethesupportandmanagementprocessesandhowtheyinteractwithorsupporttheprimaryprocesses.

3.5.1.3 Workflow Models

Operations Manager’s point of view

Managerswhoareresponsibleformonitoringperformanceandwholookforwaystocontinuouslyimproveoperationalperformancetakeanoperationsperspective,oroperationspointofview.WorkflowModelscapturetheoperationspointofview.

Copyright A

BPM


116

Describe WHAT must be done

WorkflowModelstypicallydescribeWHATmustbedonefortheprocessestobecompleted.Thesemodelsaremoredetailedthanenterpriseorbusinessprocessmodels.Workflowmodelsaremappeddowntotheactivities(alsocalledtasks,orprocedures)thatmakeuptheprocesses.WorkflowModelsincludetheactivitiesthat“functions”—positions,departments,andsystems—performandtherelationshipoftheactivitiestootherfunctionsandprocesses.

Rolling up activities

Atthisthirdlevelofdetailitiseasytounderstandtheactivitiesthatareperformedinafunctionalbusinessunit.ByrollingtheactivitiesuptotheBusinessProcesslevel,itiseasytoseehowallworkfitsintoprocessesandhowtheactivitiesplayrolesinproducingtheendproductoftheprocess.

Details “below” the Workflow Model

TheWorkflowprovidesonlyabasicunderstandingofthedetailinthebusinessoperation.Itisoftennotasufficientlevelofdetailtoresolveproblems,reducecost,orsupportautomation.Fortheseactions,itisnecessarytotaketheworkflowleveltoagreaterlevelofdetail.

3.5.1.4 Task Steps

And,yes,therearestilllowerlevelsofdetailthatmaybeneeded.Thekeyistomaptheprocessestothelevelthatyouneedtosupport

Whatyouaredoing,and Whatsomeoneinthenextphaseoftheprocessprojectneedstodo.

Lowest level identifies worker tasks and data requirements

Atthefourthlevel,theTaskStepslevel,thebusinessandBPMSdesignersusuallyhaveenoughdetailtotierulestospecificworkerorsystemsactions.Theuseofdataisnowatalowenoughlevelofdetailtodesignapplicationscreensandreports,anddefineeditsandlowleveldecisions.Asabusinessprocessprofessionalyoumayparticipateinaprojectwherethenextphaseinvolvesdevelopingsoftwareapplications.Tosupportwhatthesoftwaredevelopersneedtodo,

Conferwiththesoftwaredeveloperstodeterminetheinformationthatwillmosthelpthemincodingandtesting,and

Considertheuseofforward‐lookingandbackward‐lookingtraceabilitymatricestodocumentfunctionalrequirements.Traceabilitymatricesensurethatthesoftwarewillbecodedandtestedtosupportthepeoplewhoexecutetheprocess.

Additionally,thislevelisusedtogenerateBPMS(businessprocessmanagementsystem)applicationsthatmanageworkandautomatemanual“transaction”leveldataentryanduse.

Copyright A

BPM


117

Remembertoconsidertherequirementsforanyofthesefollow‐ondevelopmentactivitiesandthedetailneededtodrivetheircompletion,reachedinthemodels.

“Worker” point of view

Thosewhoactually“do”theworkcommonlyfocusontheirtasks(alsocalledresponsibilities,activitiesorprocedures)andthestepsthatmakeupthetasks.TaskStepsidentifyHOWworkgetsdone.

Task Steps describe in detail HOW work is done

Thisisthelevelofdetailwheretheanalystcanidentifythestepsthatareperformedtodelivertheoutputoroutcomeofasingleactivity.TaskStepsincludesforeachtaskthetasktrigger,steps,criteriaofperformance,principlestofollow,materialsandtoolstouse(includingsoftware),results,indicatorsofcorrectperformance,andpeoplewhoneedtobeconsultedduringorinformedaftertheprocedureisperformed.

Example of service Task Steps

Forexample,aninsurancecompany’spolicysalesstaffneedstoenteranewpolicyholderintothesystem.TheTaskStepslevelnamestheactivity(alsocalledaprocedure,andherecalledatask)andliststhestepsthatthesalesstaffmustperformtoenterthenewpolicyholder.

Example of manufacturing Task Steps

Anotherexampleatthislevelinmanufacturingis“build‐to‐order”(BTO).Hereacustomerplacesanorderwithasalesperson.Theprojectprocessanalystcollectstherequirementsforthe“customized”product.Assumingabuildfromcommonparts,theanalystidentifiestheparts,definestheoptions,cutsthebuildorder,getsthepartsandthenconstructsit.

3.6 Bottom‐Up and Top‐Down Modeling Approaches

Thereareanumberofapproachestoprocessmodeling:top‐down,middle‐out,orbottom‐up.Someprocessmodeldevelopmentmethodscallforaniterativeprocessapproachthatrequiresseveralsuccessivepassestodevelopingthemodel.Theapproachusedvariesdependingonthepurposeandthescopeoftheeffort.

Bottom‐up modeling projects

Traditionally,processmodelsweregenerallycreatedforthepurposeofimprovingnarrowlyfocusedfunctionswithinasingledepartmentoroperation.Oftentheprocesshasnotbeendocumentedandthefirststepistoattempttodiscoverwhatisactuallyoccurring.Bottom‐upapproaches,centeredonverydetailedactivityandtask‐orientedworkflows,workbestforthesekindsofprojects.

Top‐down modeling projects

Itisnowbecomingmorecommontofindprocessmodelingappliedto

Copyright A

BPM


118

Improvingandinnovatinglargescale,end‐to‐end,cross‐functionalbusinessprocessesand

Managingperformanceofthesebusinessprocesses.

Someprocesstransformationeffortsbeginwithdevelopinganewbusinessmodelfirstandthendeterminingwhatneedstobedoneinthebusinesstoimplementthebusinessmodel.Amoreholisticbusinessprocessmanagementapproach,usingenterprise‐wideprocessmodels(“architectures”)toalignbusinessprocesseswithbusinessstrategies,isalsobecomingmorecommon.Thesetypesofmodelingeffortsarebestdevelopedwithtop‐downmethods.

Modeling approach rule of thumb

Thekeyistodeterminethepurposeofthemodelingeffortandthenapplythebestapproachforthatpurpose.Onceanapproachisselected,considerusinganalternateapproachonalimitedbasistocross‐checkresults.Forexample,dosomebottom‐upanalysistoensurethatthetop‐downmodeliscomplete.Whereservice‐orientedsystemarchitectures(SOA)arebeingengineered,thebottom‐upanalysismayalsobenecessaryfordevelopingspecificsysteminterfacestolinkintothelargerSOAnetwork.

3.7 Capturing Process Information, and Modeling Participants

Thereareseveraldifferentwaystocaptureinformationforprocessmodeling.Considerusingoneoracombinationofthesetechniquestogatherdescriptionsofaprocess:

Directobservation One‐on‐oneinterviews Writtenfeedback Structuredworkshops Webconferencing.

3.7.1 Direct Observation

Advantages and constraints

Directobservationisagoodwaytodocumentcurrentproceduraldetail.Itmayuncoveractivitiesandtasksthatotherwisemightnotberecognized,anditcanbeeffectiveinidentifyingvariationsanddeviationsthatoccurinday‐to‐daywork.

However,becauseitisnecessarilylimitedtoarelativelysmallsamplesize,directobservationmaynotcapturetherangeofvariationsacrossgroupsandlocations.Directobservationalsoentailstheriskoftheperformersdoingwhattheythinkyouwanttosee,ratherthanwhattheynormallydo.

Copyright A

BPM


119

3.7.2 Interviews


Interviewscancreateasenseofownershipandparticipationintheprocessofmodelinganddocumentingbusinessprocesses.Thisapproachrequiresminimaldisruptionofparticipants’timeandnormalduties.

However,toscheduleandconducttheinterviewsmaytakemoreoverallelapsedtimethanothermethods.Itmaybedifficultafterwardtobuildacohesiveprocessflowandtomapthedifferentviewsintoasingleview.Thistechniquegenerallyrequiresfollow‐upandsometimesdoesn’tuncoveralloftheactivitiestocompletelydescribetheprocess.

3.7.3 Survey/Written Feedback


Writtenfeedbackalsorequiresminimaltimeanddisruptionofduties.Generally,datamaybecollectedinthisfashion.

However,writtenfeedbackisoftenpronetothesameproblemsencounteredwithone‐on‐oneinterviews,suchastakingmoretime,missingsomeinformation,timespentreconcilingdifferencesofopinionordifferentdescriptionsofthesameworkbydifferentpeople,requiringfollowup.

3.7.4 Structured workshops


Structuredworkshopsarefocused,facilitatedmeetingswhereenoughsubject‐matterexpertsandstakeholdersarebroughttogethertocreatethemodelinteractively.Theyoffertheadvantageofshorteningtheelapsedcalendartimerequiredtodevelopthemodelsandgiveastrongersenseofownershiptotheworkshopparticipantsthanothertechniques.Structuredworkshopscanalsohavetheadvantageofafacilitatorwhomaybeskilledinmodelingtechniquesnotcommonlyknownbyprocessparticipants.

However,duetothepotentialtravelandexpensethatmayberequired,workshopsmaybemorecostlythanothermethods.Generally,modelsproducedinworkshopsrequirelessfollow‐upandgenerateacommonlyagreed‐upondescriptionofaprocessmorequicklyandwithhigherqualitythanothertechniques.

3.7.5 Web‐Based Conferencing


Web‐basedconferencingcanbeemployedtogainmuchthesamebenefitsasface‐to‐faceworkshops,buttheyworkbestwithsmallergroups.Web‐basedconferencingcanbemoreconvenientandlessexpensivewhentheparticipantsarewidelydistributed.

Copyright A

BPM


120

However,usingthiskindoftechnologyeffectivelydependsonhavingfacilitatorswhoareskilledintheuseofthesetechniques.Inworkshopsdonethisway,itcanbemoredifficulttomonitorandmanageindividualparticipationinthegroupwork.

3.7.6 Modeling Participants

Developingprocessmodelsinvolvesanumberofrolesbecauseofprocessmodels’widerangeofuses.Manypeoplemaybeinvolvedincreatingasetofmodelsthatfullyrepresentstheprocesses.Businessstrategists,businessmanagers,financialanalysts,auditorsandcomplianceanalysts,processperformanceanalysts,requirementsanalysts,systemsanalysts,orothersmaycreatedifferentprocessmodelsfortheirparticularpurposes.Modelscanbecreatedbyindividualsexpressingtheirpersonalknowledgeorbygroupsoutliningthescopeanddepthofthebusinesstheyareaddressing.Inamorestructuredapproach,typicallytherewillbeafacilitator,amodeler,andseveralsubjectmatterexpertsinvolved.

Thesubjectmatterexpertsmaybe

Executivesexpressinghigh‐levelbusinessdynamics, Mid‐levelmanagersdefiningmonitoringandcontrolmechanisms,or Workerswhoactuallyperformtheworkbeingmodeled.

Forre‐designefforts,informationsystemspersonnelwhodeveloptherequirementsforITsupportmustcollaboratewithorganizationaldesignpersonnelwhodetermineroles,responsibilities,andreportingstructures,orfinancialpersonnelwhomeasurecostandvalueoptions.

3.8 Frameworks and Reference Models

Amodelingprojectmayrequiremanyindividualmodels.Thesemodelshavevaluebothindividually,asstand‐alonerepresentations,andascomponentsofthewholeproject’scomplexpicture.Frameworksandreferencemodelsmaximizethevalueandusefulnessofthesetofmodelswithinthecontextofthewhole.Thereareanumberofframeworkandreferencemodelexamples.

3.8.1 Modeling Within a Framework

Aframeworkmayrangefromasimpleconceptualpyramidtoacomplexsetofmodelingproductswithrulesgoverningwhatwillberepresentedwhere.Inthepyramid,eachlevelofmodelsummarizesthelevelbeneathitanddecomposesthelevelabove.Thepyramidmayhaveasimplevaluechainatthetoplevelthatprovidesaninstantoverallsummaryofwhatthesetofmodelswillexplain.Thelowerlevelsgenerallyintroducekeyevents,performers,operationalactivities,andmoredetailedprocessflow.Sometimesalevelisincludedbelowthedetailedprocesslevelstoshowdatastructureanddetailsofsystemororganizationalcomponents.

Complex frameworks enable complex process model development

Themorecomplexframeworksmayprescribeastandardsetofproductstodepictthedetailsoftheprocessesunderstudy.Verylarge,complexinstitutionsoften

Copyright A

BPM


121

adoptframeworksintendedtoapplythroughoutallmodelingeffortsoftheenterprise.Examplesoftheseinclude

FederalEnterpriseArchitectureFramework(FEAF), MinistryofDefenseArchitectureFramework(MODAF), DepartmentofDefenseArchitectureFramework(DoDAF),and TheOpenGroupArchitecturalFramework(TOGAF).

Theseframeworksservethedualpurposesofhelpingusersaddressextremecomplexitywithintheirenvironmentsandofenablingapple‐to‐applecomparisonsamongthedifferentprojectswithintheinstitution.Thelastframeworklisted,TOGAF,isageneral‐purposeversionofacomplexframeworksupportedbyTheOpenGroup.MostoftheseseeminglydifferentframeworksarederivativesoforheavilyinfluencedbytheZachmanframework,proposedbyJohnZachmanin1987.

Framework management and compliance

ManagementofthesemassiveframeworksisoftentheroleoftheEnterpriseArchitect,butallBusinessProcessManagementpractitionersmustcomplywiththestructureoftheframeworktoavoidgapsandinconsistencies.

3.8.2 Using a Reference Model

Reference models ease analysis

Areferencemodelcanservesomeofthesamepurposesasanarchitecturalframework.Areferencemodelprovidesacommonwayofviewingsomeaspectofaprocessandacommonwayofdescribingitforeasyanalysisandcomparison.Referencemodelsaredevelopedandsupportedbyorganizationsandconsortiaforthesepurposes.

SCOR® and DCORSM from the Supply Chain Council

TheSupplyChainCouncilisaconsortiumthatmarketsareferencemodelcalledSCOR®(SupplyChainOperationsReference).Organizationsseekingameansofunderstandingtheirsupplychainsforthepurposeofprocessanalysis,comparisonwithcompetitors,andassessmentofimprovementsmaysubscribetothisreferencemodel.Itprovidescommonvocabularyandstructuringofsupplychainmodelingprojectswhileallowinggreatlatitudeinthewaylower‐levelprocessesaredescribed.

Anotherreferencemodel,DCORSM(DesignChainOperationsReference)isalsopublishedbytheSupplyChainCouncil.Inadditiontothese,companiesthatmarkethigh‐levelprocessmodelingenvironmentsoftenincludesetsofreferencemodelstohelpguideeffectivemodelingwithintheenvironment.

3.9 Modeling Techniques and Tools

Therearemanymodelingtoolsandtechniquesavailable,rangingfromuseofsimplewhiteboards,butcherpaper,orsticky‐notestosophisticatedandspecializedBPMtoolsthatincludemodelinganddatastoresforthosemodelsandprocesses.Process

Copyright A

BPM


122

analysiscanbedoneeffectivelyandefficientlyusinganytypeoftool.Thefocusoftheanalysisordesign,however,shouldbeontheprocessitself,andnotonthetool.

Noneofthesetechniquesisnecessarilyexclusiveoftheothers;allcanbeemployedinaprocessredesignorimprovementprojectwithdifferentgroupsorindifferingcircumstances.

3.9.1 Drawing Tools and Reports

Duringorafterinterviewsandworkshops,participantscancapturetheprocessflowsandnotesusinginexpensivedrawingtools.Often,thesedrawingsareinsertedintoWorddocumentsorPowerPointpresentationsasameansofreportingfindingsandsharingtheresults.Thisisacommonmeansofprocessmodelingusedinorganizationstoday.

3.9.2 Electronic Modeling and Projection

Usingelectronicdrawingormodelingtoolsandprojectingtheimagestolargescreensinordertocaptureandviewthedevelopingmodelshasbecomeacommonpracticetoday.Thistechniquehasseveralbenefits.Themodelisvisibleandcanbemodifiedduringaworkshop.Whenthesessioniscompleted,notransfertoanothertoolsetisrequired.Manytoolsallowtheresultingmodelstobequicklyandeasilysharedviaemailimmediatelyorshortlyafterthesession.

Addingweb‐basedconferencingtoolsenablesremotelylocatedstakeholderstoalsoparticipateinthemodelingsessions.Inaddition,severalcurrentmodelingtoolsarerepository‐based,whichallowsthereuseofobjectsorpatternsthathavealreadybeendefinedinpreviousefforts.

3.10 Process Validation and Simulation

3.10.1 Process Simulation Uses

Processsimulationsareaformofmodelthatprovidesvaluableinsightintoprocessdynamics.Simulationsrequiresufficientdatatoallowtheprocesstobemathematicallysimulatedundervariousscenarios,loads,orotherconditions.Simulationcanbeusedtoachievethefollowing:

Validateamodelbydemonstratingthatrealtransactionsets,whenrunthroughthemodelexhibit,producethesameperformancecharacteristicsasthoseintheactualprocess.

Predicttheprocessdesign’sperformanceunderdifferingscenarios(varythenumberoftransactionsovertime,thenumberofworkers,etc.).

Determinewhichvariableshavethegreatesteffectonprocessperformance. Compareperformanceofdifferentprocessdesignsunderthesamesetsof

circumstances.

Copyright A

BPM


123

3.10.2 Simulation Tools and Environments

Simulationscanbemanualor,usingprocesssimulationtools,electronic.Processlaboratoriesareoftenusedaspartofaprocessimprovement,redesign,orreengineeringeffort.Aprocesslaboratorycanperformsimulationsbydevelopingmocktransactionsthatcanbemanuallyexecutedthroughanend‐to‐endbusinessprocessbyasmallcross‐functionalteam.Simulationscanberunagainst“asis”processesordesignedas“tobe”processes.

Processlaboratoriesoftenidentifyexceptionsandhandoffswhileprovidingimportantinsightsintoexistingandrequiredcommunicationbetweentasks,functionalareas,teams,andsystems.Someorganizationsrequireasuccessfulprocessdemonstrationinalaboratorysettingbeforepilotingorrollingoutnewprocessesorchangestoprocessdesign.

3.10.3 Technical Simulation/Load Analysis

Someprocesssimulationtoolsprovidetheabilitytoperformloadanalysis.Forexample,simulatingpeak,average,andvalleytransactionloadspredictsimpactoncycletime,resourcerequirements,andbottlenecks.Simulationgeneratesdatasetsthatallowmanydifferenttypesofprocessanalysis.Someofthetypicalanalysesareresourceutilization,distributionanalysis,cycle‐timeanalysis,andcostanalysis.

Someprocesssimulationtoolscanalsopresentanimationsofthesimulations.Animationsmaybehelpfulinvisuallyidentifyingphenomenaduringperformancethatmaynotbereadilyapparentintypicalanalysisofsimulationdatasets.

3.11 Key Concepts

PROCESSMODELING—KEYCONCEPTS

Processmodels

Aresimplifiedrepresentationsofsomebusinessactivity. Serveasameanstocommunicateseveraldifferentaspectsofabusiness

process. Areusedtodocument,analyzeordesignabusinessprocess. Areusefulasdocumentationforcommunication,trainingandalignment;

designandrequirements;orasameanstoanalyzeaspectsoftheprocess. Oftenexpressthe“As‐Is”stateofthemodelandoneormoreproposalsfor

change,culminatingina“To‐Be”modelandchangemanagementstrategy. Mayrequirevalidationbysimulation.

Perspectives

Differentlevelsorperspectivesofbusinessprocessesareexpressedbymodelsshowingdifferentscopesandlevelsofdetailfordifferentaudiencesandpurposes.

Processmodelsmaydisplayseveraldifferentperspectives:forexample,

Copyright A

BPM


124

Enterprise,Business,andOperations(Workflow). Eachdifferentperspectivehasspecifictypesofmodelsandcompositionlevels

thatarebestsuitedfortheperspective.

Notations

Therearemanydifferentstylesofprocessmodelingnotationsandwaystodevelopprocessmodels.

Selectionofamodelingnotationshouldmatchtheneedsoftheproject—thetaskathandandtheneedsoftheproject’snextphase.

Somenotationsaremoreversatileandapplytoabroadrangeofprocessmodelingneeds.

Sometimes,combinationsofnotationsmatchprojectrequirementsbetterthanasingletool.

Frameworks

Iftheprojectmustcomplywithaspecificframework,identifyframeworkrequirementsearlyon.

Referencemodelsareavailabletohelpguidethedevelopmentofmodelsinsomefields.

Capturingprocessinformation

Whenapproachingamodelingchallenge,theteammaychoosetomodelfromtop‐down,bottom‐up,orfromthemiddle,dependingonpreferenceandprojectrequirements.

Informationcapturetechniquescanvarywidelyamongprojects,andcanincludeanycombinationofobservation,interview,survey,andformalworkshop;theycanbein‐personoronline.

Participantsinamodelingprojectincludestrategist,managers,subjectmatterexperts,anddifferenttypesandnumbersofanalysts.Processimplementationoftenrequirestheskillsofchangemanagementprofessionals.

Copyright A

BPM

P International

Chapter 4

Process Analysis

Copyright A

BPM

P InternationalChapter4.ProcessAnalysis

126

Foreword by Elise Olding, Gartner, Inc.

Processanalysisencompassesalotmorethanjustflowcharts.Processanalysislivesatvariouslevels,fromaone‐pageviewoftheorganization—aconceptuallevelanalysis—toverydetailedanddirectivestepsatanexecutionlevel.

Attheconceptuallevelitisapowerfulvisualtechniquetoidentifyholistic,systemicdisconnectsintheorganization.Itcanbeusedtoengageexecutivestothinkdifferentlyaboutprocess,toseeitasawaytomakedecisionsaboutprioritiesandraisetheconversationtoastrategiclevel.Atthetacticallevel,itisusefultodriveoutcosts,standardizeworkexecution,andcontributetomoreefficientroutinework.

Inthelayersbetweenthesetwobookendsliveamyriadofanalysistechniquesthatembraceunstructuredandcollaborativeworktomakeitmoreeffective,suchassocialnetworkanalysis(SNA),decisionmatrixes,andshadowingworkparticipants.Theseareoftenoverlooked,contributingtotheviewthatprocessanalysisissomethingdoneatanexecutionlevelinanorganization.Weneedtorekindletheconversationandbringprocessanalysistotheexecutivesuite.

Processanalysisisameanstoanend.It’snottheend!Theoutcomeoftheworkmustbetogeneratevaluefortheorganization.Oneofthecommonmistakesorganizationsmakeistodwelltoolongonthe“asis”analysis,documentingeverydetail.I’vecomeacrossorganizationswitharoomfilledfromfloortoceilingwithprocessmodels,chartsthatthebusinesspartnerdoesnotwanttorevieworvalidate.Nowonder!Theywouldtakeweekstoreview;evenIhavefeltoverwhelmedtryingtotakeitallin.

Iaskthemafewsimplequestions:“Whatproblemsdidyoufind?Whatbaselinemetricsdidyoudocument?Werethereanytrendsorthemesthatbecameevidentfromthiswork?Doyouhaveanyrecommendationsfor“quickwins”?Sadly,theanswertoallthisis“No.”Somewherealongthejourney,theorganizationhasgottenlostandforgottenwhattheendgamereallyis:deliveringvaluetothebusiness.

Ontheflipside,effectiveprocessanalysiscanbeanenabler.Forinstance,acompanywaschallengedwithspinningoffaneworganizationinaveryshortperiodoftimeorriskedlosingahugeinvestmentthatwouldlikelymeanitsdemise.Theexecutivemanagementhadtheforesighttodocumentandunderstandtheirexistingprocesses:theyusedtheseintheirday‐to‐daywork,defininghowthefunctionsinteract,anddefiningrolesandresponsibilities.Fromthisstartingpoint,theywereabletoquicklyperformtheprocessanalysis,identifytheactionstheyneededtotake,andmoveforwardwiththe“tobe”implementation.Theysucceededandgottheinvestment—clearlydeliveringstrategicbusinessvalue.

Whateverlevelyouchoosetoanalyze,fromanenterpriseopportunityassessmenttoadetailedas‐isanalysis,don’tlosesightofdeliveringbusinessvalue.Alwaysaskyourself,“IfIdomore,willIcontinuetoderivebenefits?”Bemindfulofdeliveringbusinessvalue,usingtherighttechniquesforthetaskathand,andalwayschallengingwhetherfurtherworkanddetailarenecessary.

Copyright A

BPM


127

Manytechniquesaremainstreamandarelikelypartofyourrepertoire.Some,suchassocialnetworkanalysis(SNA)ororganizationalnetworkanalysis,areemerging.Others,likeworkshadowingandobservation,areunderutilized.Iwouldencourageyoutoexplorethefullspectrumofprocessanalysistechniques,becomeproficientatusingthem,andunderstandwhentoemploythem.

Copyright A

BPM


128

Contents

ForewordbyEliseOlding,Gartner,Inc..................................................................................126

4.0 Introduction..........................................................................................................................130

4.1 WhatisProcessAnalysis?...............................................................................................130

4.2 WhydoProcessAnalysis?...............................................................................................131

4.3 WhentoPerformAnalysis..............................................................................................132

ContinuousMonitoring............................................................................................................132

Event‐TriggeredAnalysis.......................................................................................................132

StrategicPlanning......................................................................................................................132

PerformanceIssues...................................................................................................................132

NewTechnologies......................................................................................................................132

Merger/Acquisition/Divestiture.........................................................................................133

RegulatoryRequirements.......................................................................................................133

4.4 ProcessAnalysisRoles......................................................................................................133

4.4.1 OptimalTeamAttributes........................................................................................133

4.4.2 AnalysisRolesandResponsibilities...................................................................134

4.5 PreparingtoAnalyzeProcess........................................................................................134

4.5.1 ChoosetheProcess....................................................................................................135

4.5.2 ScopeoftheAnalysis................................................................................................135

4.5.3 ChooseAnalyticalFrameworks............................................................................136

4.5.4 PerformingtheAnalysis..........................................................................................137

4.5.5 BusinessContext.........................................................................................................137

4.5.6 OrganizationalCulture/Context..........................................................................137

4.5.7 PerformanceMetrics................................................................................................138

4.5.8 CustomerInteractions..............................................................................................138

4.5.9 Handoffs.........................................................................................................................139

4.5.10 BusinessRules..........................................................................................................139

4.5.11 Capacity........................................................................................................................139

4.5.12 Bottlenecks.................................................................................................................140

4.5.13 Variation......................................................................................................................140

4.5.14 Cost................................................................................................................................140

4.5.15 HumanInvolvement...............................................................................................141

Copyright A

BPM


129

4.5.16 ProcessControls.......................................................................................................141

4.5.17 OtherFactors.............................................................................................................142

4.6 GatheringInformation......................................................................................................142

4.6.1 AnalyzingtheBusinessEnvironment................................................................143

4.6.2 AnalyzingInformationSystems...........................................................................144

4.6.3 AnalyzingtheProcess...............................................................................................145

4.6.4 AnalyzingHumanInteractions.............................................................................147

4.7 DocumenttheAnalysis.....................................................................................................150

4.8 Considerations.....................................................................................................................150

ExecutiveLeadership................................................................................................................150

OrganizationalProcessMaturity.........................................................................................150

AvoidDesigningSolutionsduringAnalysis....................................................................151

ParalysisfromAnalysis............................................................................................................152

ProperTimeandResourceAllocation..............................................................................152

CustomerFocus...........................................................................................................................152

UnderstandingOrganizationCulture................................................................................153

Fact‐BasedAnalysis...................................................................................................................153

PotentialResistance..................................................................................................................153

4.9 Conclusion..............................................................................................................................154

4.10 KeyConcepts.......................................................................................................................154

Copyright A

BPM


130

4.0 Introduction

Thefirststepindefininganewprocessorupdatinganexistingoneistocreateacommonunderstandingofthecurrentstateoftheprocessandhowtheprocessachievesthestatedbusinessobjectives.Thiscommonunderstandingisgainedthroughprocessanalysis.

Inthischapterweexplorethetopicofprocessanalysis,startingwithwhyaprocessmustbeanalyzedandwhoshouldbeinvolvedintheanalysis.Thenwewillexplorethespecificsofhowtoanalyzeaprocess,followedbydiscussionsaboutthetechniques,tools,methodologies,andframeworksthatcanbeused.Finally,toensureacompleteunderstandingofwhatisnecessaryforsuccessfulprocessanalysis,wewilllookatsuggestedpractices.

4.1 What is Process Analysis?

Processanalysisprovidesanunderstandingoftheprocessactivitiesandmeasurestheresultsofthoseactivitiesinmeetingtheorganization’sgoals.

Aprocessisaseriesofinterrelatedtasksoractivitiesthatachieveaparticularend.Inthecontextofbusinessprocessmanagement,a“businessprocess”isdefinedasend‐to‐endworkthatdeliversaproductoroutcome.Thisend‐to‐endworkcancrossfunctionalareasandproceedthroughmultipleorganizations.

Whethertheassignmentistoanalyzeoneprocessortheprocessesthatconnectactivitiesacrossbusinessunits,businesspartners,orthebroadervaluechain,processanalysiscanbeappliedtoaddressthecurrentandfutureimprovementopportunities.

Processanalysisisaccomplishedbyvariousmeans,includingmapping,interviewing,simulations,andothertechniques.Itoftenincludesastudyofthebusinessenvironment,theorganizationalcontextoftheprocess,factorsthatcontributetotheoperatingenvironment,industrycharacteristics,governmentandindustryregulations,marketpressures,andcompetition.

Keyfactorstoconsiderare:

Businessstrategy Theobjectivesoftheprocess Thekeychallengesinachievingthegoals Thecontributionoftheprocessintheoverallsupplychain Theorganizationandbusinessrolessupportingtheprocess.

Thosewhointeractwiththeprocessshouldagreeuponinformationgainedthroughtheanalysis.Theyneedtoachieveanobjectiveandunbiasedperspective,regardlessofanyexistinginefficiencies.Processanalysisformsthefoundationforprocessdesign,whichisthetopicaddressedin“ProcessDesign”(chapter5).

Copyright A

BPM


131

4.2 Why do Process Analysis?

Processanalysisisanessentialtooltoevaluatehowefficientlythebusinessisworkingtomeetitsobjectives:itgeneratestheinformationnecessaryfortheorganizationtomakeinformeddecisionsassessingthebusiness’sactivities.Theprincipalbenefitofanalyzingthe“currentstate”oftheprocessisasharedunderstandingofhowtheworkisdonetoday.Bycreatingafoundationalassessmentbasedondocumented,validatedfacts,current‐stateanalysiscanhelpthoseengagedintheredesignofprocessestobettermeetthegoalsofthebusiness.

Forthebusinesstoevolveandadapttochange,ongoingprocessanalysisisrequiredtoensurethatbusinessneedsaremet.Changinggovernmentregulations,economicconditions,andmarketingstrategiescanquicklyresultinprocessesthatnolongermeettheiroriginaldesign.

Aholisticreviewofthemajorprocesseswithinascopeofbusinessactivitiesbeginswithanunderstandingoftheorganizationalstrategy.Strategicconsiderationsframetheprocessobjectivesandchallengesinabroadercontext.Processanalysisgoesbeyondtheshort‐termtacticalproblemsorthewish‐listofthebusinessunit.Processanalysisaddressesthefundamentalprocesschangethatwillimpactachievementoforganizationalgoalsandstrategies.

Monitoringprocessefficiencywithongoingdashboardmetricsindicatesiftheprocessistoocostly,orifgapsexistinprocessperformance.Theanalysisprovidesthemeasuresandunderstandingofprocesseffectivenessandefficiency.

Theinformationgeneratedfromthisanalysisincludes

Anunderstandingofthestrategy,goals,andobjectivesoftheorganization Thebusinessenvironmentandthecontextoftheprocess(whytheprocess

exists) Aviewoftheprocesswithinthelargercross‐functionalprocess Inputsandoutputsoftheprocess,includinginternalandexternalsuppliers

andconsumers Therolesandhandoffsofeachbusinessunitintheprocess Anevaluationofscalabilityandresourceutilization Anunderstandingofthebusinessrulesthatcontroltheprocess Performancemetricsthatcanbeusedtomonitortheprocess Asummaryofopportunitiesidentifiedtoincreasequality,efficiency,or

capacity.

Thisinformationbecomesavaluablemanagementresourceforunderstandinghowthebusinessisfunctioningandformakinginformeddecisionsonadaptingtoachangingenvironment.Aidedbythisinformation,managementcanensurethatprocessstructuresareoptimalforattainingbusinessobjectives.

Copyright A

BPM


132

4.3 When to Perform Analysis

Processanalysiscanbedoneinresponsetosignalsfromcontinuousmonitoringofprocesses,oritcanbetriggeredbyspecificevents.Thissectiondiscussestheimpactofeach.

Continuous Monitoring

BusinessProcessManagement(BPM)isacommittedpartofanoverallbusinessstrategy,ratherthanasingleactivitythatiscompletedinthecontextofasingleproject.Managingthebusinessbyprocessrequiresthatperformancemetricsbeinplacetomonitortheprocessessothattheymeettheidentifiedgoalsoftheorganization.BPMimplementationshouldincludethecapabilitytocontinuouslyevaluateprocessesastheyareperformedthroughtheuseofreal‐timemonitoringtools.Whendeviationsinprocessperformancearise,ongoingprocessanalysisallowsformoredecisionsregardingcorrectiveactions,ornewanalysistowardsprocesschange.

Event‐Triggered Analysis

Eventsarethemostfrequentlyoccurringtriggersofprocessanalysis.Thefollowingarejustafewoftheeventsthatmaytriggeraprocessanalysis.

Strategic Planning

Mostcompaniesregularlyreviewandupdatetheirstrategicplans.Theysurveythemarketandcompetitivelandscapefornewopportunitiesandestablishnewgoals.Manyofthesegoalsimpacttheorganization’sstructure,andthereforetheprocessessupportingtheorganizationalgoals.Followinganupdatetothestrategicplan,processesmayneedtobeupdated.

Performance Issues

Whenperformanceissuesemerge,processanalysiscanassistinidentifyingthecausesofpoorprocessperformance.Performanceissuesmaypresentinvariousways,from(forexample)unacceptableproductqualityordeviationsfromregulatoryrequirementstoexistingsalessupportprocessesnotkeepingpacewithnewproductlines..

New Technologies

Advancesintechnologymaypositivelyornegativelyimpactprocessperformance.Aspartofimplementationorupgradeplanning,processanalysiscontributestotheblueprintofhowthenewtechnologieswillbeemployed.Thisblueprintincludesanunderstandingofhowandwherenewtechnologiesshouldbeappliedtogainthemaximumbenefitfortheorganization,andwhattheimpactwillbeonotherprocesses.Forexample,implementinganewapplicanttrackingsystemshouldtriggerananalysisofthedownstreamandparallelprocesses.Thisway,increasedapplicantflowcanbemanagedseamlessly,andapplicantexperiencecanbekeptuniformacrossalternativechannels.

Copyright A

BPM


133

Merger/Acquisition/Divestiture

Businessmergersandacquisitionsoftenresultindisjointedproductionandserviceprocesses.Inordertoachievevaluefrommergersoracquisitions,processanalysisiscriticalforestablishingthecapabilitiesrequiredbythecombinedentity,whileatthesametimeeliminatinggapsandredundancies.Inthecaseofdivestitures,processanalysispriortothedivestiturecanhelpensurethatcriticalprocessessurviveintherestructuredentities.

Regulatory Requirements

Oftenregulatorybodiesgoverningbusinesseswillcreateorchangeregulationsthatrequirethebusinesstomodifyitsprocesses.Byperformingprocessanalysisaspartofmeetingtheserequirements,abusinesscanensurethatitcomplieswiththeregulatorychangesinawaythatmanagesrisk,controlscosts,andminimizesdisruption.Organizationsthatachieveahighlevelofprocessmanagementcan,inmanycases,lookforopportunitiestointegrateregulation‐drivenprocesseswithinternalqualitycontrols,andthusachievemorecostsavingsandrobustcompliancethanorganizationsthatlookuponregulatorycomplianceasacostlyadd‐on.

4.4 Process Analysis Roles

Successfulprocessanalysiswillinvolveavarietyofindividualswithintheorganization.Examplesoftherolesinvolvedinprocessmanagementarefurtherdefinedin“ProcessOrganization”(chapter8).

Severalkeyrolesnecessarytoperformprocessanalysisaredefinedbelow.Oneofthefirststepsinaprocessanalysisistoestablishandassignthoseroles.Theindividualorgroupultimatelyresponsiblefortheperformanceoftheprocess,whetheritistheprocessownerortheexecutiveleadershipteam,shouldcarefullyselectthosewhowillleadandmanagetheteaminthevariousroles.Itwillbetheresponsibilityoftheseleaderstoensuresuccessfulcompletionoftheproject,includingacomprehensiveandaccuraterepresentationofthestateoftheprocess.

4.4.1 Optimal Team Attributes

Asingleindividualcanperformprocessanalysis,butthebestpracticeisforprocessanalysistobeperformedbyacross‐functionalteam.Thiscross‐functionalteamwillprovideavarietyofexperiencesandviewsofthecurrentstateoftheprocess,whichresultsinabetterunderstandingofboththeprocessandtheorganization.Thisteamshouldincludesubjectmatterexperts,stakeholders,functionalbusinessleadersandprocessowners,allcommittedtothebestpossibleprocessoutcomesandhavingauthoritytomakedecisionsabouttheneededchanges.Suchteamshavetheaddedbenefitofestablishingbroadownershipandimprovedacceptanceofthecomingchange.

Itisalsoimportanttomakesurethatenoughtimehasbeenallocatedfortheseresourcestocontributeproperlytotheassignment.Asinanyproject,processimprovementprojectsoftenfailbecauseofalackoftimeandpriorityplacedonthe

Copyright A

BPM


134

project.Ontheotherhand,takingtoolongfortheanalysisphaseofacomplexprojectisoneofthemorecommonpitfalls.Balancingtheinventoryofprocessesandsub‐processesinvolvedandensuringtheprocessteamwillgetthepropertimecommitmentfromthebusinessunitsistheresponsibilityoftheprojectteamleader.

Theanalystoramemberoftheprocessteamshouldhavecompetenciesintheprocessmanagementframeworksdescribedlaterinchapter9.Firmsoftenuseoutsideconsultantswithexpertiseinprocessmanagementtosupplementinternalknowledgeandexperienceofprocessmanagementmethodologies.

Oncetheprocessteamisinplace,theteamleadmustcommunicatethegameplanandteam‐memberroles.Eachandeverymembermustunderstandwhatisexpectedandagreetocommitthetimeandeffortrequiredtomaketheprojectasuccess.

4.4.2 Analysis Roles and Responsibilities

Thefollowingdescribestheresponsibilitiesofeachrolewithinprocessanalysis.TheorganizationalcompetenciesrequiredtosupportaBPMprogramarefurtherdefinedinchapter8,“ProcessOrganization.”

Role Responsibility

Analyst Decidethedepthandscopeoftheanalysis,howitisanalyzed,andthenproceedtoperformtheanalysis

Projectmanageorfacilitatetohelpprojectadvancement

Providedocumentationandfinalreportstothestakeholdersandexecutiveleadership

Facilitator Leadprocessanalysisteams

Facilitatewithunbiasedviewtoletthegroupdiscoverthepaththroughtheanalyticaltechniqueschosen

Managegroupdynamics

SubjectMatterExpert

Provideinsightintothebusinessprocess

Provideinsightintoboththebusinessandtechnicalinfrastructurethatsupportstheprocess

Table10

4.5 Preparing to Analyze Process

Processpractitionerswhohavebeeninvolvedintheredesignoflarge‐scaleprocessesknowthatdrillingdowninsideasingleprocessusuallydoesn’tprovidetherightlevelofunderstanding.Evaluatingtheactivitiesandworkflowwithinonlyasingleprocessmaynotprovideanadequatebasisforimprovingtheprocess.Oneneedstoconsiderhowchangetoasingleprocessimpactsotherrelatedprocessesin

Copyright A

BPM


135

theend‐to‐endprocess.Forexample,aneworderentrysystemimplementedforcliententrymayinitiateatransaction,yetreturnsarereconciledfromanothersystem.Thisprocessmayperformwellfromacustomerperspectiveandyetfailbecauseitdoesnotprovideadequateinformationfromafinancialperspective.

Todeterminethescopeoftheprojectandthetoolstobeused,theanalystshouldconsiderthefullcontextoftheprocessactivitiesandthevalueprovidedtootherusersandotherprocesses.Thefollowingsubsectionswillexplorethesefactors.

4.5.1 Choose the Process

AlthoughtheprocessestobeanalyzedoftenhavealreadybeendeterminedinthecontextofanenterpriseBPMengagement,theremaybeinstancesofcompetingprioritiesacrosstheprocessesthatneedtobeanalyzed.Forthisreason,large‐scaleorcross‐functionalanalysisshouldincludegovernancethatestablishescriteriaforprioritizingandorderingtheprocessestobeanalyzed.Forexample,anorganizationmayidentifythesecriteriaforhigh‐impactprocesses:

Customer‐facingprocesses Highimpactonrevenue Alignedtootherprocessesthatarehighvaluetothebusiness Criticaltocoordinatewithcross‐functionalimpact

Scoringmetricscanbeusedtoassignpointvaluesforthesefactors,andprioritizationcanberecommendedbasedontheprocesseswiththehighestscores.

Whatevermethodischosentorankthem,theprocesseschosenshoulddirectlymeetthegoalsoftheorganizationandhaveapositiveimpactonthecriticalbusinessresult.

4.5.2 Scope of the Analysis

Establishingthescopeoftheprocessesincludedintheanalysisisoneofthefirstactionsoftheprocessteam.Scopingiscriticaltodecidehowfartheprojectwillreach,howmuchofthebroaderbusinessfunctionwillbeinvolved,andtheimpactofanychangesonupstreamanddownstreamprocessesandusers.

Forexample,toanalyzeanHRrecruitingprocess,thescopeoftheanalysismayincludeapplicantscreeningthroughthecandidateselectionprocess.Asecondpossibilitywouldbetoanalyzeapplicantscreeningthroughtheemployeeon‐boardingprocess.ThislatterscopewouldextendbeyondthetraditionalHRrecruitingprocessestoincludenewhireorientation,employeebenefitenrollment,andprovisioningprocesses.Scopeselectionshouldconsidertheobjectivesanddesiredoutcomesoftheanalysis.Iftheobjectivewererelatedtosystemssupportingtheend‐to‐endprocess,thefullscopeisessential.Ifonlytheapplicantscreeningprocessistobeanalyzed,theimpactonrelatedupstreamanddownstreamprocessesshouldstillbeconsideredevenifthoseprocessesarenotinscope.

Oncethescopeoftheanalysisisdetermined,theanalystshouldalsoconsiderthedepthoftheanalysis.Willtheactivity‐levelbeadequateorshouldallinputsand

Copyright A

BPM


136

outputsbeconsideredaspartoftheanalysis?Toomuchanalysiscanhinderprocesscreationorredesign.Avoidinganalysisparalysisiscritical,andwillbeexploredlaterinthischapter.

Itmaybenecessarytointerviewavarietyofindividualsinvariousbusinessfunctionsbeforemakingscopedecisions.Animportantconsiderationisthatthemorebusinessfunctionsandactivitiesincludedintheanalysisproject,themorecomplicatedtheanalysisandthelongeritislikelytotake.Toshowprogressandmanagecomplexity,theanalystorteammaywishtobreakdownlargerprocessesandanalyzesub‐processes.

4.5.3 Choose Analytical Frameworks

Thereisnosinglerightwaytoanalyzeabusinessprocess.Topicstobestudied,methodsforstudyingthem,toolstobeused,etc.,arealldependentonthenatureoftheprocessandtheinformationavailableatthetimetheanalysisbegins.Someprojectsmaystartwithacompletedandverifiedmodelthatcanbeusedforanalysis,whileothersmayrequirethedevelopmentofamodel(oratleastvalidationofthemodeldesign.)

Theanalyst,alongwiththeprocessteam,shouldreviewandselecttheanalyticalapproach,methodology,andframework.FormalprocessimprovementmethodssuchasSixSigma,Lean,orotherqualitymethodsprovidetoolsandtemplatestoassistinthereviewprocess.Thesemethodsarefurtherdiscussedinchapter6,“ProcessPerformanceManagement.”Oncetheanalysisteamselectstheframeworkormethodology,itcandecidewhattechniquesandtoolstouseaspartofthatframework.

Ifaformalmethodisselected,theteamshouldhavetrainingoranexperiencedfacilitatorguidingtheuseoftheanalyticalframeworks.Itisalsoimportanttoconsidertheindustryandthetechnologyrelatedtotheprocess.Iftheprocessisdrivenbyqualitymeasures,suchasamanufacturingproductline,formalmethodssupportedbydataandqualitymeasuresareanappropriateapproachinthatenvironment.Ifthedataisnotavailableoriftheprocessisnotstructured,apragmaticreviewmaybethebestapproach.

Pragmaticprocessanalysiscanbebasedonastandard“Plan‐Do‐Check‐Act”sequenceofsteps.Reviewtheprocessagainstinternallydevelopedqualitystandardsandbestpractices.Thesemayincludeminimizinghandoffs,ensuringthateachactionaddsvaluetotheprocess,andmanagingdataorproductinputsclosetothesource.Todeliversignificantimprovementtotheorganizationwithverylowrisk,theteamshouldreviewtheprocesstoensurethatallparticipantsaccuratelyexecutethesamebestpractice.Theteamcandriveprocessefficiencyandeffectivenessthroughapragmaticreviewofthecurrentbestpracticefromallprocessvariationscurrentlyinuse.Thenitcandesignprocesscontrolsandguidancetoensureexecutionofthebestpracticeandreduceoreliminatevariations,exceptions,anderrors.

Copyright A

BPM


137

4.5.4 Performing the Analysis

Thereareseveralwell‐recognizedandpublishedmethodologiesforprocessanalysis.SomeofthesetopicsarecoveredinrelatedchaptersonProcessModelingandProcessMeasurement.Thecommonactivitiesduringaprocessanalysisaredescribedbelow.Theseactivitiesapplywhethertheprocessisanestablishedoranewprocessandshouldbeconsideredinthecontextoftheprocessreview.

4.5.5 Business Context

Achieveageneralunderstandingofthereasonfortheprocesstoexistwithinthebusinessenvironmentbyansweringquestionssuchasthese:

Whatistheprocesstryingtoaccomplish? Whyhasitbeencreated? Whattriggeredtheanalysis? Whatarethesystemsrequiredtosupportorenabletheprocess,andhow

sustainablearethosesystems? Wheredoestheprocessfitintothevaluechainoftheorganization? Istheprocessinalignmentwiththestrategicobjectivesoftheorganization? Doesitprovidevaluetotheorganization,andhowcriticalisit? Howwelldoesitfunctioninthecurrentbusinessenvironmentandhowwell

coulditadaptiftheenvironmentweretochange? Whataretheriskstotheprocess(external,environmental,orinternal)and

cantheprocessadapttosurvivethoserisks?

4.5.6 Organizational Culture/Context

Everyorganizationhasaculturethatinfluencestheinternalandexternalprocessesofthatorganization.Thatcultureincludeshowworkisperformedandwhatmotivatesthemembersoftheorganizationtodothework.Culturalfactorsmayleadtounintendedconsequencesasnewprocessesareputintoplace.Partoftheanalysisprocessistounderstandthecultureoftheorganizationandthoseunwrittenrulesthatdeterminehowandbywhomworkisreallyaccomplished.Thisunderstandingiscriticalformanagingtheorganizationthroughchange.Notethatattitudeswillchangeasanalysisandexecutionprogresses.Theinteractionamongculture,processes,andthechangeprogramrequirescontinuousmonitoring:

Whoaretheleadersintheorganizationresponsibleforthesuccessfuldeliveryoftheprocessoutcomes?Howcommittedaretheytothechanges,andhowconfidentaretheythattheimprovementswillbesuccessful?

Howaretheproposedchangesandimprovementsviewedbypowerfulservicefunctions,suchasHR,QualityControl,Compliance,Finance,etc.?

Whatisthemotivatingfactorforqualityprocessoutcomes?Howisprocessexecutionincorporatedintheincentivesthatrewardworkoutput?Hasthesuccessofaprocessbeenmeasuredonqualityoutcomes?

Copyright A

BPM


138

Howwillthechange‐managementtrainingbedeliveredintheorganization?Willthegoalsformeasuringsuccessincludesuccessfulimplementationofchange?

Howwillindividualsaffectedbyorresponsiblefortheprocessinterpretthereasonfortheprocesschange?Isprocessexcellenceakeycompetencyintheorganizationorstrategy?Arethereattitudes,practices,orperformancegoalsthatprovideincentivesagainstcooperationorchange?

4.5.7 Performance Metrics

Performanceissuescanbedefinedasgapsbetweenhowaprocessiscurrentlyperforminginrelationtohowitshouldbeperformingtomeettheorganization'sobjectives.Amethodicalanalysiscanilluminatethenatureofthegaps,whytheyexist,andhowthesituationcanberectified.Akeyelementoftheanalysisistoidentifyactionableandauditablemetricsthataccuratelyindicateprocessperformance.Thesemetricswillprovideindicatorsastowhereandhowaprocessshouldbeadjusted.Keyquestionstoaskduringthisdiscussionincludethefollowing:

Istheprocessmeetingitsperformancegoals? Whatistheacceptedservicelevelfortheprocess?Areturnaroundtimes

laggingbehindthecurrentacceptabletargets? Howwouldweknowiftheprocesshasimproved?Forinstance,iftimeisthe

measurementoftheprocess,cancostbeignored?Orifcostisthemeasurementoftheprocess,cantimebeignored?

Howisbusinessprocessmonitoringmanaged?Whatarethekeymetricsandhowaredeviationsaddressed?

Areperformancemetricsordashboardsreviewedcontinually,sotheprocessisaccuratelymeasuredandmonitored?

4.5.8 Customer Interactions

Understandingthecustomerinteractionswiththeprocessiscriticaltoknowingwhethertheprocessisapositivefactorinthesuccessoftheorganization’svaluechain.Generally,thefewerrequiredinteractionsbetweenthecustomerandagivenservice,themoresatisfiedthecustomer.Thistopicshouldaddressthefollowingquestions:

Whoisthecustomer?Whydocustomerschoosetoparticipateintheprocessratherthangoelsewhere?

Whatsuggestionsdocustomershaveforimprovingtheprocess? Howmanytimesdoesacustomerinteractwiththeprocess?Arethere

redundanciesintheinteractions? Howcoherentistheprocessandtheutilizationofcustomerinformation,

fromthecustomer’sperspective? Whataretheclientsatisfactionmetrics?Aretheywithinthedesirednorm? Whatisthecustomer'sexpectationorobjectivewiththeprocess?

Copyright A

BPM


139

Iftheprocesssupportsinternalactivities,whataretheimpactsorindirecteffectstothecustomer?

4.5.9 Handoffs

Anypointinaprocesswhereworkorinformationpassesfromonesystem,person,orgrouptoanotherisa“handoff”forthatprocess.Handoffsareveryvulnerabletoprocessdisconnectsandshouldbeanalyzedclosely.Thefollowingquestionsmightbeusedasguidance:

Whichofthehandoffsaremostlikelytodelaytheprocess? Arethereanybottlenecksofinformationorservicesasaresultofhandoffs

happeningtooquickly,orcreatingdownstreamdelays? Cananyhandoffbeeliminated? Wheredostreamsofinformationcometogether,andaretimingand

sequencingaccurate? Whatmeansareinplacetomanagesequencing,timing,anddependencies

acrosshandoffs?

4.5.10 Business Rules

Businessrulesimposeconstraintsanddrivedecisionsthatimpactthenatureandperformanceoftheprocess.Often,businessrulesarecreatedwithoutsufficientunderstandingofthescenariostheorganizationmayencounter,orhavebecomedisconnectedduetochangingconditionsorunmanagedchange.Whenanalyzingthebusinessrulesoftheprocess,considerthefollowing:

Dotheexistingrulescomprehensivelycoverallthescenariosanddecisiondriversthatmaybeencounteredduringtheexecutionoftheprocess?

Aretherelogicalgaps,ambiguities,orcontradictionsintherulesgoverningaprocessarea?

Aredependentorinterrelatedprocessesgovernedbyconsistent(orcontradictory)rules?

Arethebusinessrulesinalignmentwiththeobjectivesoftheorganization? Dothecurrentbusinessrulescauseobstaclesbyrequiringunnecessary

approvals,steps,orotherconstraintsthatshouldbeeliminated? Whenandwhywerethebusinessrulescreated,andhowweretheydefined? Whatwouldbetheresultofeliminatingcertainrules? Whatprocessisinplaceformanagingchangetobusinessrules?

4.5.11 Capacity

Capacityanalysisprobesupperandlowerlimitsanddetermineswhetherproductionfactorscanappropriatelyscaletomeetthedemands.Whenanalyzingthecapacityofaprocess,considerthefollowing:

Cantheprocessscaleupward?Ifvolumesareincreased,atwhatpointwilltheprocessbreakdown?

Copyright A

BPM


140

Howwelldoestheprocessscaledownward?Whatisthecostoftheprocesswhenidle?

Whathappenstotheprocesswhensuppliesandmaterialsaredelayedorunavailable?

Whentheprocessacceleratesorslows,whathappenstodownstreamprocesses?

4.5.12 Bottlenecks

Abottleneckisacapacityconstraintthatcreatesabacklog.Thefollowingquestionsmayhelptheteamunderstandthenatureofthebottlenecks:

Whatarethefactorscontributingtothebottleneck,andarethesefactorspeople,systems,ororganizational?

Doesthebottleneckoccuraroundhandoffsamongmultiplegroups? Isthebottlenecktheresultofaninternalorexternalconstraint?Whatisthe

natureoftheconstraint—resourceavailability?Rules?Processdependencies?

Arethereunnecessaryrolespecializationsororganizationalsilos?

4.5.13 Variation

Althoughespeciallytrueinthemanufacturingindustry,variationinanymassproductionindustryisnotgood.Variationinevitablyslowsdowntheprocessandrequiresmoreresourcestoproperlyscale.Ifthenatureofthebusinessrequiresvariationasitscorebusinessstrategy,thenlookforplaceswheresomeofthevariationcanbereduced,whichcouldsaveontheoverallcycle‐timeoftheprocess.Discussiontopicscouldincludethefollowing:

Howmuchvariationistolerablefortheprocess? Isvariationnecessaryordesirable? Wherearethepointswherevariationismostlikelytooccur?Cantheybe

eliminated,andifso,whataresomerecommendations? Canautomationhelpeliminatevariation?

4.5.14 Cost

Understandingthecostofexecutingtheprocesshelpstheteamprioritizewhichprocessesdeserveearlyattention.Someofthediscussionsmightrevolvearoundthefollowing:

Whatisthetotalcostoftheprocess,takingintoaccountfrequencyandcircumstancesofitsexecution?

Isthecostinlinewithindustrybestpractices? Canthecostbereducedthroughautomationortechnologyimprovements?If

so,howandtowhatextent? Whatwouldbetheimpactonrealizedvalueandoperatingmarginsofeach

option,inordertomakethisprocessmorecostefficient?

Copyright A

BPM


141

4.5.15 Human Involvement

Processesinvolveeitherautomatedactivitiesoractivitiesperformedbyrealpeople.Automatedactivitiesgenerallyrunconsistently,andwhentheydon’titispossibletofindandcorrectthesituationthatiscausingtheproblem.Activitiesperformedbyrealpeoplearemorecomplexbecausetheyinvolvejudgmentandskillthatcannotbeautomated.Peopledonotalwaysdothesametaskinthesameway.Whereprocessesorprocessmanagementisnotmature,peoplemaycompensatebyindividuallyexecutingfunctionsormethodsthatarenotdocumentedorreadilyvisible.

Thefollowingquestionscanhelpguidethediscussionaroundthisimportantanalysis:

Howmuchvariabilityisintroducedbythehumanelement?Isthevariabilitydesirable?Isittolerable?Cantheactionbeautomated?Whatwouldbetheresulttotheprocess?Whatwouldbetheresulttothehumanelementandtothecultureoftheorganization?

Howcomplexisthetask?Whataretheskillsetsrequired?Howareperformerstrainedforthetask?

Howdotheperformersofthetaskrespondtoexternaleventsduringthetask?

Howdoestheperformerknowwhenthetaskisdonewell?Whatfeedbacksystemsareinplacetoguidetheperformer?Whatcantheperformerdowiththisfeedback—whatcanheorshechangewiththisknowledge?

Doestheperformerknowwherethetaskliesintheprocessandwhattheresultsoftheactionsaredownstream?Doess/heknowwhathappensbeforethetask?Whatdoestheperformerdowithvariationsintheinputsforthetask?

Howmuchknowledgeisavailabletotheperformertoaccomplishthistask?Isitsufficient?

Aretheresignsthatprocessesaread‐hocratherthanvisible,understood,andrepeatable?Forexample,dopeoplefrequentlyhavetoresorttoheroicactsorinterventionsinordertogetcriticalworkdone?Arepeopleinostensiblysimilarrolesperformingdifferentwork,orperformingsimilarworkdifferently?

4.5.16 Process Controls

Processcontrolsareputinplacetoensureadherencetolegal,regulatory,orfinancialconstraintsorobligations.Processcontrolsaredifferentfromcontrolprocessesinthattheformerdefinethecontrolwhilethelatterdefinethestepstoachievethatcontrol.Forexample,therequirementtoobtainasignatureisaprocesscontrol,whilethestepthatmustbeperformedtoobtainthatsignatureisacontrolprocess.Thefollowingquestionsmayassistinunderstandingwhatprocesscontrolsareinplace:

Copyright A

BPM


142

Arethereanylegalcontrolsorregulatoryrisksthatmustbeconsideredinrelationtotheprocess?

Whataretheenvironmentalimpactsoftheprocess,anddothoseimpactsneedtobecontrolled?

Whoaretheregulatoryorgoverningagenciesthatwillregulatetheprocessanddotheyneedtobeinformedoftheprocesschange?

Whatcompetenciesandrolesalreadyexisttoexecuteandoverseeprocesscontrols?

Areprocesscontrolstructuresandprocedureswelldocumentedandunderstood?Istheretrainingandcertificationsupporttoensureunderstandingandexecution?

Doreportingrelationshipsensureindependenceofqualityorprocesscontrolfunctionsandtheexecutionofthecontrolprocesses?

4.5.17 Other Factors

Thepurposeofthetopicsaboveistosparkdiscussionabouttheprocess.Otherdiscussiontopicsnotmentionedabovewillnaturallyariseduringtheprocessanalysisandshouldequallybeexplored.Conversely,someofthetopicsnotedabovemightnotapplytotheprocessbeinganalyzed.Thekeypointtorememberisthattheanalysismustencompassavarietyoftechniquesandtopicstoachieveacompleteandwell‐roundedunderstandingoftheprocess.

4.6 Gathering Information

Thenextstepintheanalysisisfortheanalystorteamtogatherasmuchrelevantinformationaspossibleabouttheprocessandbusinessenvironment.Thetypesofinformationgathereddependonthebusinessandprocessbeinganalyzed.Theycanincludeanyorallofthefollowing:

Strategicinformationaboutthecompany,suchaslong‐termstrategy,markets,threats,opportunities,etc.

Acompany'sperformanceincomparisontoitspeers,orbenchmarkedtootherrelatedindustries

Therationalefortheprocessanalysisandatwho'srequest Thefitoftheprocessintotheorganization Thepeoplewhoshouldbeinvolvedintheprocessanalysisproject Thisinformationmaybefoundusingmethodssuchas: Interviewswithindividualsinvolvedintheprocess. Performancerecords/transactionreviewsontheprocess(althoughthisdata

mayormaynotsubstantiatetheinformationlearnedinthestakeholderinterviews)

Walkthroughsoftheprocess,orobservationofactualexecution. Auditreportsthatidentifycontrolpointsintheorganization.

Copyright A

BPM


143

Interviewing

Animportantmethodofgatheringinformationandpreparingfortheprocessanalysisistointerviewthosewhohaveactivitiesinoraresomehowassociatedwiththeprocess.Thoseinterviewedmayincludeprocessowners,internalorexternalstakeholders(vendors,customers,orpartners),thosewhoworktheprocessandthosewhopassinputsto,orreceiveoutputsfrom,theprocess.Theseinterviewscanbeinaformalface‐to‐facesettingorcanbeconductedviaphoneore‐mail.Typically,theformalface‐to‐facesettingismoreproductive,asitallowsforgreaterdialoganddiscussionaboutwhatis(orwas)actuallyhappening.Agroupinterviewperformedbyafacilitatorcanalsobeeffectiveingeneratingdiscussionaboutprocesses.

Observing

Anotherimportantmethodofgatheringinformation,andsimilartointerviewing,isdirectobservationoftheprocess.Eitherthroughreportsorsystemtransactionlogs,orbyobservingthehumaninteractionswiththeprocess,directlyobservingtheprocesswillhelpcreateanunderstandingofwhattheprocessisactuallydoing.

Often,analystsfindthatduringananalyticalobservationofaprocess,furtherquestionsandinterviewsneedtobeconductedtofullyunderstandtheprocess.Interviewsandfact‐findingshouldtakeplacethroughouttheanalysis,anditisquiteappropriatetoholdinterviewsduringanypartoftheanalysisprocess.

Researching

Beginbyresearchinganydocumentationornotesabouttheexistingprocess.Thiscanincludeanywrittendocumentationcreatedwhentheprocesswascreated,transactionorauditlogs,processdiagrams,etc.Shouldthisinformationnotbeavailable,theanalystmaywishtorequestwrittendescriptionsoftheprocessfromthekeystakeholdersandactorsintheprocess.

4.6.1 Analyzing the Business Environment

Tofullyunderstandabusinessprocess,theanalystmustalsounderstandhowthebusinessandthebusinessenvironmentinteract.Abusinessenvironmentanalysisincludesunderstandingtheorganization’smarketandexternalfactorsaffectingit,thecustomers'demographicsandneeds,businessstrategy,thesuppliers,andhowworktransformstomeettheneedsofthecustomers.

Asthebusinessenvironmentchangesovertime,somusttheorganization'sprocesses.Thebusinessanalysisinformstheanalystoftheenvironmentalchangesthathavetakenplacesincetheprocesswasfirstcreatedandcanhelpexplainthereasonsforpoorperformanceofaprocess.Understandingtheserelationshipsisimportantfordiscerninghowprocessesmightneedtochange.

Thereareasmanymethodstoanalyzethebusinessenvironmentasthereareresearchersandconsultantswithinthefieldofbusinessmanagement.Thefollowingareafewcommontechniquesusedinanalyzingthebusinessenvironment:

Copyright A

BPM


144

Benchmarking

Duringtheanalysisitisgoodpracticetocomparetheperformanceofaprocesstosimilarprocessesintheindustry.Theseprocessesalsocanbecomparedtosimilarprocessesindifferentindustries.Thisinformationcanbegainedthroughindustrysurveysandotherindustryroundtableorexchangegroups.

Anothertypeofbenchmarkingtechniqueiscomparisonofthesubjectorganizationwithitsdirectcompetitors—thatis,toanalyzehowprocessescomparetocompetitorprocessesandconsidercompetitiveadvantages.A“S.W.O.T.”(strengths,weaknesses,opportunities,threats)analysisispartofthisinvestigation.Competitiveanalysistechniquesincludeobtaininginformationfrompublicsources,industrytradeassociations,websites,customers,orconsultingfirmsurveys.Essentialprocesscharacteristicsfromtheorganizationarethenbenchmarkedagainstthoseofcompetitors.

Thefinaltypeofbenchmarkinganalysisidentifiesprocessesthataresimilartotheprocessbeinganalyzedbutthatexistasbestpracticesinotherindustries.Forexample,onlineretailcompaniesadopt‘bestpractices’inorderprocessing;asonlineorder‐entryforaretailfirmisredesigned,ananalysisofbroaderindustrybestpracticescanbereviewedforothertypesoforderingprocesses.Theretailfirmisapttodiscovernewprocessingideassincetheyareresearchingcompaniesoutsidetheirindustry.Thisanalysisallowstheprocessdesignerstoescapethe“groupthink”syndromethatoftenexistswhenorganizationslookonlywithintheirowncompanyorindustry.Thistypeofanalysiscanhelppromotetransformationalchangeinanorganization.

Understandingandanalyzingthesebenchmarksinrelationtotheprocessesbeinganalyzedwillhelptheanalysisteamunderstandtheperformancepotentialoftheprocessanditsweaknessesinachievingthatperformance.

4.6.2 Analyzing Information Systems

Often,automatedprocessdiscoverywillfindthatthemajorcausesofinefficiencyincludesignificantprocessvariabilityacrossdifferentusers,processrestartsandrework,exceptionsanderrors.

Afewcommonanalyticaltechniquesaredescribedbelow:

Data Flow Analysis

Dataflowanalysisseekstounderstandhowdataflowsthroughasystemandhowdataitemsinteractatpointsthroughtheprocess.Dataontransactionsprocessedthroughthesystemwillgiveinsightintothevolumeandcomplexityofmanytypesoftransactions.Dataflowanalysisprovidesauniqueviewofwhathappenstothedataduringtheprocessandenablesbetterunderstandingofthevolumeofstandardandexceptionprocesses.

Thistypeofanalysishelpstheanalystuncoverbottlenecks,unneededqueuesorbatches,andinteractionsthatdonotaddvalue.DataFlowAnalysisalsohelpsuncoverbusinessrulesthatshouldorshouldnotbeapplied,basedonthedata.Such

Copyright A

BPM


145

businessrulesmightaddinsightintotheroutinerulesthatcouldbeautomatedandappliedasstandardtransactions,aswellasthoserepresentingexceptionprocesses.

Business Rules

Businessruleswerediscussedasoneoftheelementsinunderstandingtheorganizationalculture.Theyarecoveredinchapter10ingreaterdetail.

Manyautomatedsystemsexplicitlyorimplicitlyincorporatebusinessrulesintotheirconfigurationsorhard‐codedalgorithms.Theserulesoftenareessentialtosmoothbusinessoperations,yetarepoorlyunderstoodbythepeoplewhoseworkdependsonthem.Thisisespeciallytrueinorganizationsthathavenotachieveddisciplinedprocessdocumentationandchangecontrol.Insuchorganizations,institutionknowledgeislostasstaffturnsover,andtheonlyevidenceoftheseimportantrulesishowtheyarecodedon‐system.

Thechallengeistoworkwithtechnicalanalystsandapplicationsupporttouncovertheseoftenhiddentrovesofrulesinformation.Thenextstepistoreverse‐engineertherulesfromtheconfigurations.Thishastobedoneincloseconsultationwithstaffthathavefunctionalexpertiserelatedtotherules.

Systems Documentation and Suitability for Use

Howsoftwaresystemsareused—whethercustom,configurable,oroff‐the‐shelf—isanimportantsourceforfindingprocesses.Often,systemsandhowtheyareusedisnotdocumented.Thediscoveryprocessshouldthusincludeidentifyingsystems‐dependentprocessesandthenreverse‐engineeringthoseprocessesandrulesbasedonhowthesystemisactuallycoded,configured,andused.

Donotassume,however,thatthesystemscurrentlyinusearethebestsolutionforthejob.Therecanbemanycluesthatthisisnotthecase.Peoplemayviewthesystemasanimpedimentratherthanajobsupport;oryoumayfindthatpeopleimplementworkaroundsandmanualstepstocompensatefortheinadequaciesofthesystem.Theanalystmuststrivetounderstandhowstaffmembersrelatetotheirautomatedtools.Thiscanbeessentialtounderstandingwhattheprocessesreallyare,andwhereanydisconnectsoccur.

4.6.3 Analyzing the Process

Thefollowinganalyticalinstrumentsareoftenusedtoextractinformationaboutaprocess,suchashowlongtheprocesstakes,thequantityofproductthroughtheprocess,thecostoftheprocess,etc.Theprocessanalysisteamshouldlookforthoseinstrumentsthatwillbestexplainthetypeofdatadesiredfortheprocessbeinganalyzed.

Creating Models

Processmodelsareoftenusedtoshowprocessesandthevariousinteractionswithoneormoreofthem.Chapter3,“ProcessModeling,”isdevotedtovarioustechniquesthatcanbeusedtocreateprocessmodels.

Copyright A

BPM


146

Cost Analysis

Alsoknownasactivity‐basedcosting;thisanalysisisasimplelistofthecostperactivity,totaledtocomprisethecostoftheprocess.Thisanalyticaltechniqueisusedfrequentlybybusinessestogainanunderstandingandappreciationofthetruecostassociatedwithaproductorservice.Thistypeofanalysisisoftenusedinconjunctionwithotheranalyticaltoolsandtechniquesdiscussedinthissection.

Thisanalysisisimportanttotheprocessanalystinordertounderstandtherealdollar‐costspentontheprocesssoitcanbecomparedtothedollarvalueinthenewprocess.Thegoalmaybedecreasedcosts,or—ifincreasedefficiency—thevalueoftheincreaseinproductioncomparedagainstthecost.

Thistypeofanalysiscanquicklyuncoverbottlenecksinbusinessprocessesastheyinteractwiththesystem.Asmostprocessesaredependentonsomesortofautomatedsystem,theinteractionandcostpertransactionofthesystemiscriticaltounderstandingthesystem.

Root‐cause Analysis

Aroot‐causeanalysisisa'post‐mortem'techniqueusedtodiscoverwhattrulycausedagivenoutcome.Theintentoftheanalysisistopreventundesirableoutcomesfromhappeningagain.

Findingtherootcauseforanoutcomeisnotalwaysaseasyasitmayseem,becausetheremaybemanycontributingfactors.Theprocessoffindingtherootcauseincludesdatagathering,investigation,andcause‐and‐effectrelationshipdiagrammingtoeliminateoutcomes.Thisprocessismucheasierwhentheoutcomeisisolatedandcanbeeasilyreproduced.

Sensitivity Analysis

Asensitivityanalysis(alsoknownasa“whatif”analysis)triestodeterminetheoutcomeofchangestotheparametersortotheactivitiesinaprocess.Thistypeofanalysiswillhelptheprocessanalystunderstandthefollowingcharacteristicsoftheprocess:

Theresponsivenessoftheprocess.Thisisameasurementofhowwelltheprocesswillhandlechangestothevariousparametersoftheprocess.Suchparameterswouldincludeanincreaseordecreaseofcertaininputs,andincreasingordecreasingthearrivaltimeofcertaininputs.Thiswillenabletheanalysttoknowhowquicklytheprocesswillflow,howmuchworktheprocesscanhandle,andwherethebottleneckswilloccur,givenanysetofparameters.

Thevariabilityintheprocess.Thisisameasurementofhowtheoutputoftheprocesschangeswiththevaryingofparametersintheprocess.Often,oneofthegoalsinperformanceimprovementistoeliminatevariabilityintheoutcome.Knowinghowvariabilityintheparametersaffectstheoutcomeisanimportantsteptounderstandingtheprocess.

Thesensitivityanalysisisinstrumentalinunderstandingtheoptimalperformanceandscalabilityoftheprocessandtheeffectsofanyvariationsinitsparameters.

Copyright A

BPM


147

Risk Analysis

Similartothesensitivityanalysis,theriskanalysisexaminestheeffectivenessofprocesscontrolpoints.Examplesofthesecontrolpointsincludevalidatingclientidentityor,forpurchases,clientcreditratings.Thesestepsandthebusinessrulessurroundingthemestablishlimitsbeforetheprocesscanproceed.Theseactivitiesandbusinessrulesmustbeinplaceastheprocessisdesigned.Theriskanalysisaimstoconsiderwhatwouldhappentotheprocessshouldanyofthesescenarioshappen,andultimatelywhattheoutcomewouldbetotheorganization.

4.6.4 Analyzing Human Interactions

Manyprocessesrequiresometypeofdirecthumaninvolvementtoensuretheirprogression.Thesearetheprocessesthatusuallyrequirethemostanalysisinordertounderstand.Thefollowingaretechniquesthatcanbeusedtoassisttheanalystincreatingthatunderstanding:

Direct Observation

Onetechniqueistodirectlyobservethoseperformingtheprocess.Muchcanbelearnedbyjustwatchingprocessperformersinaction.Theyaretheexpertsandgenerallyhavefoundefficientwaystodowhattheyhavebeenaskedtodowithintheconstraintsthathavebeenimposedonthem.Aftertheanalystfeelss/heunderstandsthebasicsofwhattheperformerisdoing,itmaybehelpfultoaskafewquestionsaboutactionsthatarenotunderstood.

Theprimaryadvantageofdirectobservationisthattheanalystcanseethecurrentprocessfirsthand.Ananalyst’spresence,however,canbeaninfluencecausingslightlyalteredbehaviorbytheperformer.Sufficientobservationtimeshouldbeallowedfortheperformertobecomecomfortablewiththeobserverwhoiswatchingandtakingnotesontheactionbeingperformed.Careshouldbetakentoensurethattheworkobservedrepresentstheroutinenatureofthejob,ratherthanacarefullyselectedsampleoftransactions.Theprocessorselectedfortheanalysisshouldalsorepresentthetypicalperformancelevelfortheprocessor‐groupandnot(forexample)thehighestlevelofperformanceinthegroup.Performanceisalsomodifiedwhenthesubjectisbeingobserved;thisiscalledtheHawthorneimpact.Theseconditionsshouldbeconsideredastheobservationsareperformed.

Specificthingstolearnfromthiskindofanalysisare:

Doestheperformerknowhowthethings/hedoesimpactstheresultsoftheoverallprocessandcustomerofthatprocess?

Doestheperformerknowwhathappensintheoverallprocess,oriss/hesimplyworkingwithintheknownproceduresofthespecificrole?

Whatcriteriadoess/heusetoknowwhether,attheendofeachperformancecycle,theworkperformedissatisfactory?

Theanalystshouldalsodemonstratehowtheactionsperformedbythehumaninteractionimpacttheoutcomeoftheprocess.

Copyright A

BPM


148

Asaworkermayworkseamlesslyfromtransactional‐basedtoknowledge‐basedwork,morequestionsmaybeneededtouncoveranddocumentthe“knowledge‐based”observationsrequiredforthehumaninteraction.Inaddition,knowledge‐basedtasksshouldbeevaluatedaspotentialbusinessrulestobecapturedandpotentiallyautomated.

Apprentice Learning

Learningwhatisbeingdone,ratherthanmerelywatching,offersdeeperlevelsofcomprehensionofaperformedaction.Whenpossibleanduseful,theperformershouldteachtheanalystthejob.Thiscanyieldadditionaldetailabouttheprocess.Teachingcausestheperformertothinkaboutaspectsoftheprocessthatmightoccursubconsciously.

Thismethodisusuallyperformedonrepetitivetaskssuchasorderfulfillment.Byperformingtheprocess,theanalysthasagreaterappreciationforthephysicalaspectsoftheactivityandcanbetterassessthedetailsoftheoperation.

Duringtheapprentice‐learningperiod,itisusefultohaveasecondanalystobservethelearningprocessandtheinitialactionsoftheapprentice.

Activity Simulation

Onemethodofanalyzinghumanperformanceistosimulatetheactivitiesinvolvedinaprocess.Theactivitywalk‐throughcanbeaccomplishedinavarietyofways:

Duringtheinterview,ananalystmaycarefullystepthrougheachactivity,observingitsinputs,outputs,andthebusinessrulesthatgovernitsbehavior.

Inaprocessworkshop,membersengagedintheprocessmeetandtalkthroughtheprocess.Insequence,thepersonrepresentingtheprocess‐stepdiscussesindetailwhatisdone,howactionsaregoverned,whatstepsareperformed,andhowlongitwilltake.Handoffsfromoneperformertothenextcanbedetailedtoensurethatallrequiredinputsareavailableforthenextactivity,andfromwhatsource.Itisadvantageoustohavetheprocessmodelavailableinaformatthatallcansee,sothosewhoarenotdirectlyinvolvedinanactivitycanfollowtheprocessinthemodelandnoteanydeviations.Afacilitatorengagedtoconducttheworkshopcanhelptheparticipantsengageinproductivesessionsandprocessdiscovery.

Abonusvariationistorecordonvideothegroupwalk‐throughforlateranalysisanddiscussiontoensurethatallimportantelementshavebeencaptured.

Thelattertwovariationsinvolveparticipantsintherealprocesswhoaretherealexperts,offerthebestadviceandmeansforimprovement.

Workplace Layout Analysis

Aworkplacelayoutanalysisismostlyaphysicalanalysisofaworkplace,assemblyline,ormanufacturingfloorspace.TheactivitiesusedtoanalyzeworkflowandthemovementofmaterialsandresourcesastheworkiscompletedarefurtherdetailedintheconceptsofLean.Thefocusonreducingextramotion,waitingtime,andtransportationstepscanaddvalueastheworkisredesigned.Thistypeofanalysiscanuncoverunnecessarymotionformaterial‐relatedbottlenecks,disconnections,

Copyright A

BPM


149

andduplicatedeffortsasworkitemsaretransferredfromonephysicallocationtoanother.

Thisanalysiscanalsobeusefulforanyprocessthatinvolvesaphysicalspacewhereactivitiesareperformedandhandedoffbetweenindividuals,groups,workstations,etc.

Resource Allocation Analysis

Thisanalysisisfocusedontheresourcingrequiredtocompletetheprocess.Ittakesintoperspectivetheskillsoftheresourcesandabilitiesoftoolsorotherautomatedsystemsinmeetingtheneedsthataprocessdemands.Itgenerallyseekstodeterminewhy,fromthefollowingperspectives,anactivitytakesagivenamountoftime:

Capabilitiesoftheresource.Thisanalysisconsiderswhattheresourceiscapableofaccomplishingandaskswhethertheskillsandtrainingaresufficienttoperformtheactivityadequately.Comparisonscanbemadetosimilarresourcesdoingsimilartaskstovalidatewhethertheresourceinquestionwillaccomplishwhatcouldbeaccomplishedinthesameamountoftime.

Quantityofresources.Thisanalysisexamineswhethertheresourceisconstrained.Forresourcesengaged,suchasapieceofequipment,theanalysisexaminesthespecificationsoftheequipmenttoensurethatitisbeingusedwithinthetolerancesgivenbythemanufacturer.Forhumanresources,theanalysisexamineswhethertheresourcesarefullyengagedandmasteringthekeyelementsofthejob,orareunderutilized,insomewaybecomingabottleneck.

Often,companiesworkingthroughaprocessimprovementinitiativeundergoaresourceallocationanalysisonlytodiscoveritisnottheprocessesthatareinefficient,buttheresourcesascurrentlyutilized.Byperformingthistypeofanalysis,theanalystcanoftenuncoverseveralbottlenecksthatcanbeimprovedwithlittlecostorchangeininfrastructure.Ifthebottlenecksarerelatedtostaffingororganizationalstructure,changeswilldependontheorganization'sabilitytomanagehumanresourceissues.

Motivation and Reward Analysis

Onecommonlyoverlookedanalyticalcomponentistheexaminationofthehumanmotivationalandrewardsystemsinplacefortheprocess.Therewardsystemcouldincludeanynumberofrewardssuchasajobstructureandpromotionalopportunitiesformasteringadditionalskillsetsandcompetencies,bonuses,emotionalsatisfaction,etc.Understandingthosemotivationsandrewardswhenaprocessisanalyzedwillhelpuncoverunseendisconnectsandbottlenecksintheprocess.

Further,themotivationandrewardanalysisshouldalsoconsiderwhatrewardsshouldbeinplacetopositivelyaffectanynewprocessoractivitythatisintroduced.

Copyright A

BPM


150

4.7 Document the Analysis

Thefinalstepinananalysisisthegenerationofreportsandotherdocumentationregardingthefindings.Thedocumentationoftheanalysisservesseveralpurposes.Itactsasaformalagreementamongthosethatparticipatedastotheaccuracyoftheanalysis.Next,itisthebasisforpresentingtheresultsoftheanalysistomanagement.

Thisdocumentationcouldincludeanyofthefollowingitems,asappropriatefortheprocessthatwasanalyzed:

Overviewofthecurrentbusinessenvironment Purposeoftheprocess(whyitexists) Processmodel(whatitdoes,andhowitisdone)includinginputstoand

outputsfromtheprocess Gapsinperformanceoftheprocess Reasonsandcausesforthegapsintheprocessperformance Redundanciesintheprocessthatcouldbeeliminated,andtheexpected

savingsasaresult Recommendedsolutionsorotherconsiderations.

Thedocumentationshouldclearlypresentanunderstandingofthecurrentstateandincludedeliverablesthatprovidetheinformationnecessarytoconsiderprocesschange.

4.8 Considerations

Thefollowingsectionoutlinesseveralofthecriticalsuccessfactors,suggestedpractices,andpitfallstoavoidduringaprocessanalysis.

Executive Leadership

Oneofthemostimportantfactorstoensuresuccessduringanystageinaprocessimprovementprojectisthesupportanddirectencouragementoftheexecutiveleadershipteam.Ideally,executiveleadershipshouldbetheprimarysponsorbehindtheprocessimprovementproject.Attheveryleast,theexecutiveleadershipteammustcommittoprovidingfullsupporttotheprocessredesignorimprovementproject.

Toconvincetheleadershipteamofaprocessimprovementproject’sbenefits,itmaybenecessarytodemonstrategainsthroughafewsmallprojects.Oncethesesmallgainshavebeenprovenandsustainedovertime,itiseasiertoobtainsupportforlargerprocessimprovementprojectsand,eventually,managingtheentirebusinessthroughprocessmanagement.

Organizational Process Maturity

Iftheprocessanalysisispartofabroaderreviewofallprocesseswithinthebusinessfunction,itisimportanttounderstandthematurityoftheorganizationinrelationtotheBusinessProcessMaturityscaledefinedin“EnterpriseProcess

Copyright A

BPM


151

Management,”chapter9.Understandingthematurityoftheorganizationinprocessmanagementwillhelpdefinethelevelofanalysisinpreparationforbroaderprocesstransformation.

Thefollowingexampleillustratesafive‐levelprocessmaturitymodel.Usingcommonfactorssuchasprocessalignment,processautomation,andintegrationwithotherprocesses,ratingscanbeassignedtodeveloparatingforeachprocess.Oncetheseratingsareknownacrossabroaderbusinessfunction,themodelcanserveastheguideforfuturetransformationplanning.

Evaluatingprocessmaturityisimportantforanyholisticreviewofthecompletebusinessfunction.Processmaturityisanessentialinputintotheroadmapforexecutingchangeinitiativessuchasmajortechnologyinvestmentsorenterpriseprocessplanning.Processmaturityconsiderationswillalsofactorintoopportunitiesforprocesstransformationandserveasabasisforfuturestrategicinitiatives.

Avoid Designing Solutions during Analysis

Althoughmentionedpreviouslyinthisdocument,itdeservesrepeating.Oftenduringtheanalysisprocess,solutionstoprocessproblemswillarise.Membersoftheprocessteamwillwanttoexplorethesesolutionsandsometimesbeginworkimmediatelyondesigningasolution.Thispracticeisanalogoustobeginningconstructiononabuildingwithonlypartoftheblueprint.

Atthesametime,itisimportantnottodiscouragesuggestionsforsolvingprocessproblemsthatareuncoveredduringtheanalysis.Onepracticeistocreatea‘parking

Figure39.ProcessMaturityModel

Copyright A

BPM


152

lot’ofsuggestionsbasedontheitemsdiscovered.Whenitistimetodesignthenewprocess,addressthoseitemsonthelistaspartofthelargertrueprocessdesign.

Paralysis from Analysis

Experiencehasshownthatitispossibletodotoomuchanalysis.Somemembersoftheanalysisteamwillwanttodocumenteachtriflingdetailabouteachactivitythathappensinaprocess.Suchdetailcanquicklybecometediousandthoseinvolvedintheprocessimprovementteamcanloseinterest.Processanalysisparticipantsandmanagementmaybecomeimpatientwiththelackofprogress.Iftheanalysisisprolonged,membersassignedtotheprojectmaynotbeavailablefortheremainderoftheprojectduetoothercommitments.

Inordertobeeffective,theprogressoftheanalysisshouldbequickandreadilyvisibletoallmembersoftheteam,aswellastotheleadershipteamsupportingtheproject.Agoodconsultantorfacilitatorcanalsoassistinmovingtheteamforwardand,ifprogressisslow,shouldbeconsidered.

Itisalsocriticaltoensurethatthescopeofanalysisissmallenoughtobemanageable.Besuretofactorprocessareasintochunkssmallenoughtoalloweachteamtoreadilycomprehendtheprocesseswithintheirscopeandmakerapidprogress.

Proper Time and Resource Allocation

Often,resourcesassignedtoimprovementprojectshaveothermission‐criticalresponsibilitieswithintheorganization.Althoughitiswisetogetthemostknowledgeableindividualsontheprocessanalysisteam,theseindividualsmaynotbeabletodedicatethemselvessufficientlytokeeptheprojectmovingforward.

Fortunately,companyleadersareoftenawareofthisproblemanddecidetoretainconsultantsorcontractorstoassistintheprocessimprovementsothemanagementteamcancontinuerunningthebusiness.However,whileconsultantscanhelpintheexecutionoftheprocessimprovementprojectitself,consultantsarenotagoodsubstituteforthosewhoactuallyownorexecutetheprocessesthemselves.Advice:workwithmanagementtogainaccesstocriticalpractitionersandtomitigateanyworkimpacts.Itiscriticalthatthosewhoareassigningtheresourcesallowthoseresourcesappropriatetimeawayfromdailyresponsibilitiestocompletetheproject.

Customer Focus

Oneofthebiggestfactorsleadingtoasuccessfulanalysisisconsiderationofthecustomerwithintheprocess.Evenifaprocessappearstoworkwithinthecontextoftheorganization,itmaynotnecessarilyworkforthecustomer.Inevitably,ifthecustomerisneglectedintheprocess,customersatisfactionwillbesacrificedandtheprocesswillnotleadtotheincreasedperformanceexpected.

Thereisagrowingtrendtowardconsideringinter‐departmentalrelationshipsasservice‐orientedrelationships.Althoughthesame'customerservice'‐orientedinteractionsshouldtakeplacewithindepartmentsoftheorganizationasinthe

Copyright A

BPM


153

interactionswithcustomers,itisimportanttorealizethattransactionsbetweendepartmentsarenotcustomertransactionsunlessthedepartmentsareseparatebusinessunitsthatalsoservecustomersexternaltothebusinessinthesameway.However,processesbetweendepartmentsshouldstillbeexaminedforimprovement,withthe‘true’customerasthefocusofthoseimprovementsandhowtheywillindirectlyimpactthecustomer.

Thisconceptcanbedifficulttounderstandwhen,forexample,theorganizationistryingtoimproveaninternalfunctionsuchaspayrollprocessing.Whenconsideringhowpayrollprocessingaffectsthecustomer,theanalystwillexaminehowthereductionofoverheadexpensescanbeusedtodecreasecostsforthecustomer.Thisanalysisresultillustratestherelationshipbetweeneverythingintheorganization’soperationsanditsdirectorindirecteffect(s)onthecustomer.

Understanding Organization Culture

Asstatedpreviouslyinthischapter,understandingthecultureofanorganizationiscriticaltothesuccessoftheanalysisandultimatelytothedesignandimplementationofthenewprocess.Followingaretwoofthekeyelementsthatshouldbeaddressedwhenconsideringthecultureoftheorganization.Considerationofthesetopicsduringtheanalysisstagewillhelpensurethattheanalysispresentednotonlyrepresentsthetrueorganization,butthatitisacceptedbytheorganization.

Fact‐Based Analysis

Ifanychangetoanewprocessistobesuccessful,itisvitalthattheanalysisavoidsdirectinganyaccusationofproblemsthatexistinprocessestowardanyindividualorgroup.Statingfactswithoutplacingblameiscritical.Byeliminatingblameandsimplystatingthefacts,theanalysiswillmorelikelybeacceptedasacorrectunderstandingofthecurrentstateandwillavoidanyassignmentofblamethatcanresult.

Potential Resistance

Processanalysiscouldbeconsideredbymembersofthebusinessunitasapotentialdisruptioncarryingunknownelementsofchange.Theprocessownermayalsoviewtheanalysisasacriticismaboutthewaytheprocesshasbeenmanaged.

Businessunitsandprocessownersmaythereforeavoidopportunitiestoparticipateintheanalysis.Ininstancessuchasthese,itisvitalfortheleadershipteamtonegotiatethesituation,communicatetheneedfortheanalysis,andsupporttheoutcomesasanessentialelementofkeepingthebusinesscompetitivewithintheindustry.

Involvingtheprocessownerintheanalysisprocessisakeyfactorinovercomingthisissue.

Copyright A

BPM


154

4.9 Conclusion

Processanalysiscreatesacommonunderstandingofthecurrentand/orfuturestateoftheprocesstoshowitsalignmentwiththebusinessenvironment.Itisaccomplishedbytheemploymentofaprofessionalanalystorateamofindividualstoperformtheanalysis.Usingseveraldifferenttechniques,frameworks,methodologies,andsuggestedpractices,theanalysisteamdocumentsthebusinessenvironmentandcreatesmodelsandotherdocumentationtoillustratetheworkflowofthevariousactivitiesinvolvedwiththeprocessandtheirrelationshiptotheenvironmentinwhichtheprocessoperates.Theteamthenusesthisinformationtoidentifyopportunitiesforprocessimprovementorredesign.

Processanalysisisacommitmentthatallowsorganizationstocontinuouslyimprovetheirprocessesbymonitoringprocessperformanceandtherebyimprovingtheperformanceoftheorganization.

4.10 Key Concepts

ProcessAnalysis—KeyConcepts

Processanalysisservestocreateacommonunderstandingofthecurrentstateofaprocessandwhetheritismeetingthegoalsoftheorganizationwithinthecurrentbusinessenvironment.

Processanalysiscanoccuratanytimetheorganizationconsidersitnecessarybuttheorganizationshouldhaveagoaltocontinuouslymonitorprocessesasopposedtowaitingforsingleeventstotriggeraprocessanalysis.

Thevariousindividualsthatassistwithprocessanalysisincludeexecutiveleadershipandacross‐functionalteamcomprisedofstakeholders,subjectmatterexpertsandprocessanalysisprofessionals.

Processanalysisshouldfirstfocusonthehighvalueorhighimpactprocesses.Thesearedefinedas:

Customerfacingprocesses Highimpactonrevenue Alignedtootherprocessesthatarehighvaluetothebusiness Criticaltocoordinatewithcrossfunctionalimpact

Theanalysisshouldfindanexplanationoftheinteractionoftheprocesswithinthebusinessandfindanyofthefollowingdisconnections:

Performancegoalsnotbeingreached Failingcustomerinteractions Handoffsthatcreatedisconnections Processvariations Bottlenecks

Manyanalysistechniquescanbeusedduringtheprocessanalysistoobtainthetypeofinformationnecessaryfortheprocessbeinganalyzed.Thetechniquesused

Copyright A

BPM


155

shouldconsiderhumanperformance,systems,technology,modelingtools,businessenvironment,andstrategyassessments.

Processmethodologiesandframeworksensuretheprocessanalysisfollowsacommonlyacceptedpathtoachievebestresults.Processanalysiscanfollowformalanalyticalmethodologiesorapragmaticreviewofthestandardsforbestpracticeexecution.

Criticalsuccessfactorsforasuccessfulprocessanalysisinclude:executiveleadership,consideringmetrics,benchmarks,customerinteractions,andculturalconsiderations.

Copyright A

BPM

P International

Chapter 5

Process Design

Copyright A

BPM

P InternationalChapter5.ProcessDesign

157

Foreword by Jim Sinur, VP, Gartner, Inc.

Asorganizationsmoveforwardwithbusinessprocessesmanagement(BPM),theywillbefacedwiththeprospectofdesigningprocesses.Itmakesnodifferencewhethertheprocesscanbemodeledaheadoftimeornot;thebasicsofprocessdesignandtheresultingmodelswillplayheavilyintherepresentationoftheprocesses.Therearethreebasicprocessdesignapproaches:thePre‐modeledBusinessProcess,theUserInterface(UI)InfluencedProcessapproach,andfinallytheAutomatedBusinessProcessDiscovery(ABPD).Theseapproachesrangefromplannedtoactualbehavior,buttheyrepresenttheresultingprocessinamodel(completeprocessorprocesssnippets).

Aprocessrepresentation,plannedoractual,givesthecontextforworkperformed,thepoliciesineffect,theprocesscontextatthetimeofexecution,thedataorinformationleveraged,theanalyticsleveraged,thepatternsrespondedto,theresourcesleveragedtocompletion,andthegoalsandkeyperformanceindicators(KPIs)ineffect.Aprocessdesign,asindicatedabove,ismuchmorethanasimplemodelofworkflowing,butprocessdesigndoesrepresenttheflowofintelligenceappliedtoworkineitherastaticordynamicmodel.

Aprocessdesigncanbesimpleandstatic,butittendstoevolve,takingonanintelligentanddynamicnatureasthebusinesscontextgetsmorecomplexanddifferentiating.

Pre‐modeled Business Process

Thefirstandmostpopularformofprocessmodel,asofthiswriting,ispre‐modeledbusinessprocess.Whilethischapterfocusesmostlyonthisapproach,itisimportanttounderstandthereareotheralternativesthatcanbeusedaswell,asindicatedbelow.Thischapterdetailsabetterpracticeforpre‐modeledbusinessprocesses,sogoodreadingisaheadfororganizationsthataretakingaplanningapproach.Inthisapproach,processmodelsarecreatedaheadofexecution,andchangesoccurasnewpaths,exceptions,andnewstepsarediscovered,added,changed,ordeleted.

User Interface Influenced

Whiledesigningprocessmodelsinacollaborativefashionishelpful,someorganizationspreferto“testdrive”auserinterfaceandincorporatetheprocessflowintotheUI.Thisishelpfulforthosewhoaretactileandprefertoseesomethingoperate,ratherthanvisualizesteps,pathsanddecisions.Thisisagreatwaytoprototypeaprocessmodel,orbuildrealityintoapre‐modeledapproachthatcloselyfollowstheUIexperientialapproach.

Automated Business Process Discovery

Thisapproachcanvaryintactics,butitisbasedonactualactivity.Itcouldbeassimpleaswatchingworkersusingexistingopen‐ended(i.e.,menu‐driven)applicationstocreateafullprocessmodel.Itcouldbeascomplexaswatchingknowledgeworkers(employeesandorstringers)collaboratingonacaseandpresentingalternativeprocesssnippets,thusgeneratingmultiplesuccesspatterns.Acommonuseiscreatingaprocessmodelfrommultiplelogrecordsandsourcesto

Copyright A

BPM


158

createacompleteprocess.Weseethisapproachaugmentingadaptivecasemanagement,whereaprocessorportionoftheprocessisquiteunstructuredexceptforthedesiredmilestonesandoutcomes.

Therearemultiplewaysofaccomplishingprocessdesign.Itisimperativetounderstandwhatwaysworkinyourcultureandsituation.

Copyright A

BPM


159

Contents

ForewordbyJimSinur,VP,Gartner,Inc...............................................................................157

5.0 Introduction..........................................................................................................................160

5.1 WhatisProcessDesign?..................................................................................................160

5.1.1 ProcessDesign.............................................................................................................161

5.1.2 WhydoProcessDesign?..........................................................................................163

5.2 ProcessDesignFoundation............................................................................................164

5.2.1 Processmodelsarenot“BusinessArchitecture”modelsofthebusiness 165

5.2.2 TheStartingPoint......................................................................................................166

5.2.3 DefiningDataCollectionStandards....................................................................167

5.2.4 ManagingProcessDesign.......................................................................................169

5.3 ProcessDiscovery–The“AsIs”or“currentstate”...............................................170

5.3.1 Creatingafirmfoundationforchange..............................................................170

5.3.2 ManagingProcessInformation............................................................................171

5.3.3 Modellevels..................................................................................................................172

5.3.4 ProcessandWorkflowDiscovery.......................................................................174

5.3.5 Thewaytheoperationreallyworks..................................................................175

5.4 StrategicBusinessChange..............................................................................................177

5.5 ProcessAnalysis—Gaininganunderstandingofthebusiness.......................178

5.6 ProcessandWorkFlowDesign—Creatingthe“ToBe”Design......................180

5.6.1 EvolutiveManagement:UsingChangetoControlEvolutionintheBusiness..........................................................................................................................................183

5.6.2 DesigningtheNewProcess....................................................................................184

5.7 ChangeManagement.........................................................................................................193

5.8 ITInfrastructureAnalysisandDesign.......................................................................194

5.9 SimulationModeling..........................................................................................................195

5.10 Conclusions.........................................................................................................................196

5.11 KeyConcepts.......................................................................................................................196

Copyright A

BPM


160

5.0 Introduction

Thischapterfocusesonthedesignorredesignofcurrentprocessestoimproveefficiency,effectiveness,qualityandconsistency.Itdiscussesthekeyaspectsofinformationdiscovery,processdesignpreparation,keyactivitiesinprocessdesign,andkeysuccessfactorsfortheinitiative.

Thediscussionisnotintendedtopresentorpromoteaspecificmethodologyortosupportanystandards;“howto”discussionsareprovidedtohelpthereaderunderstandanapproachoratechnique.

Figure40.ProcessDesignActivities

Aswithallprojects,formalprojectmanagementiscriticaltosuccess.Thisvitalpartofdeliveringasuccessfulchangeisitselfaspecializedskillandisnotaddressedinthischapter.However,formal,focusedprojectplanningandmanagementisimportantforthesuccessfulexecutionofaprocessredesignorinitialdesign,andweurgethatmanagementcontrolsbeusedtohelppromotesuccess.Forprojectmanagementhintsandassistance,readersareadvisedtocontacttheProjectManagementInstitute.

ThediscussioninthischapterwilltouchonthesixactivitiesinFigure40,butitisnotlimitedtotheseactivitiesnoristhechapterorganizedaroundthem.

5.1 What is Process Design?

Process:Acombinationofalltheactivitiesandsupportneededtoproduceanddeliveranobjective,outcome,productorservice—regardlessofwheretheactivityisperformed.Activitiesareshowninthecontextoftheirrelationshipwithoneanother,toprovideapictureofsequenceandflow.

Processesaremadeofgroupsofactivitiesorbehaviorsperformedbyhumansand/ormachinestoachieveoneormoregoals.Theyaretriggeredbyspecificeventsandhaveoneormoreoutcomesthatmayresultintheterminationoftheprocessorahandofftoanotherprocess.Inthecontextofbusinessprocessmanagement,a

Copyright A

BPM


161

businessprocessmaycrossanyfunctionalboundarynecessarytocompletelydeliveraproductorservice.

Processesarecomprisedofsubprocesses,eachofwhichproducesaspecificpartoftheendproduct,service,ordeliverable.Thesesubprocessesalsohaveaflowrelationship.But,becauseprocessesaregenerallycross‐functionalandwindtheirwaythroughseveralbusinessunits,anyprocessdesignmustlookatboththeprocess‐levelwork(high‐levelview)andtheprocessactivitiesthatareperformedwithindifferentbusinessunits.Becauseanysinglebusinessunitcanbeexpectedtoperformsimilarworkfromavarietyofprocesses,theworkinanybusinessunitwillsupportarangeofprocesses;thus,—anychangetothebusinessunit’sactivitywillhaveafar‐reachingeffect.Becauseactivityinthebusinessunitisorganizedforefficiency,notbysubprocessorbusinessfunction,thedirectlinkofanyactivitybacktotheprocessorprocessesitsupportshasbecomeblurred.Consequently,changesarenoteasilyrelatedtoprocess,andimpactmaybehardtodefine.Atthislevelinthebusiness,thework’sefficiency,ratherthantheprocess,becomesthefocus.Thisistheworkflowlevel.

Workflow:TheaggregationofactivitywithinasingleBusinessUnit.Activitywillbeacombinationofworkfromoneormoreprocesses.Organizationofthisworkwillbearoundefficiency.Modelingwillshowthisworkasaflowthatdescribeseachactivity’srelationshipwithalltheothersperformedintheBusinessUnit.

Tobeeffective,anyprocessdesignmustconsideractivityatboththeprocessandworkflowlevels.Thereasonisthatitispossibletomaximizetheefficiencyoftheprocessandseriouslyimpairtheefficiencyoftheworkflowlevel.Ofcourse,thereverseisalsotrue,socaremustbetakentoconsidertheimpactofchangeatbothlevelstoavoidcreatingproblems.

5.1.1 Process Design

Aswehaveseen,processdesignistheformaldefinitionofthegoals,deliverables,andorganizationoftheactivityandrulesneededtoproduceaproduct,service,oroutcome.Thisdefinitionincludestheorderingofallactivityintoflowbasedonactivities’relationshipstooneanother,andtheidentificationandassociationofskills,equipment,andsupportneededtoperformtheactivity.

Also,asnotedabove,becauseitiscross‐functional,aprocess‘sactivitiesareperformedinmultiplebusinessunitsandbymanydifferentpeople.Eachbusinessunitthusperformsactivitiesfromseveraldifferentprocesses.Theseactivitiesareusuallygroupedbythetypeofworkneededtoperformthemandtheyareexecutedinanorderthatpromotesefficiency.Thisworkanditsorderinginabusinessunitisworkflow.Itisimportantthattheprocessdesignteamrecognizethisdifferencebetweenprocessandworkflow.

Copyright A

BPM


162

Inapproachingaprocessdesign(orredesign),theteamwillneedtounderstandtheend‐to‐endprocess,thebusinessunitsthatareinvolvedinitsperformanceandthewayitsactivitiesareexecutedinthevariousbusinessunits(seeFigure41).Thisisimportantbecauseteamsthatfocusonanyoneleveltocreatedesignsmayimpactordamageactivityatotherlevels.Forexample,itispossibletoeliminateseeminglyunneededworkinagivenbusinessunitthatwillhaveasignificantimpactonanotherbusinessunitdownstream.Itisalsopossibletomakeprocess‐levelchangesthatcompromisequalityortheabilitytodeliveraproductinagivenbusinessunit.However,withanunderstandingofhowtheprocessfunctionsandhowitsactivitiesaregroupedwiththoseofotherprocesseswithinthevariousbusinessunits,anewdesigncanbeevaluatedatalllevelstoensurethatimprovementactuallyisbeneficialforeveryone.

Figure41

Inthisdiscussion,wewillassumethatthisprocessbusinessunitworkflowperspectiveisagiven,andforsimplicity’ssakewewillrefertothismulti‐levelgroupingofactivityas“process.”Whenreferringtoworkwithinabusinessunit,wewillrefertoitas“workflow.”ThisrelationshipisindicatedinFigure41.

Thisdistinctionrepresentsarealizationthatthework“process”isoftenusedtodescribeanyworkoranyactivity.Wehavefoundthatthisuseofthetermcompromisesthefundamentalbeliefthatprocessiscross‐functionalandrepresentsanend‐to‐endaggregationofworkthatproducesaproductorservicethatisconsumablebyacustomer.

Processdesignthusinvolvestheidentificationandorderingofthefunctionsandactivitiesinabusinessoperation,alongwithallsupportingmechanisms,productproductiontechnology,andcomputerapplicationsystems.Theoutcomeofthisdesignisthecreationofspecificationsfornewandmodifiedbusinessprocesseswithinthecontextofbusinessgoals,processperformanceobjectives,businessapplications,technologyplatforms,dataresources,financialandoperationalcontrols,andintegrationwithotherinternalandexternalprocesses.Bothalogicaldesign(whatactivitiesareperformed)andaphysicaldesign(howtheactivitiesareperformed)areincludedasdeliverables.

Copyright A

BPM


163

Inmostcasesprocessdesigninvolvescreatingandunderstandingthecurrentprocessanditssubprocesses,andexamininghowtheoperationofcanbeimprovedorfundamentallychangedtoprovideadesiredresult.Thisresultcanbeanythingfromcostreductiontoanimprovedabilitytochangerapidly—asinamovetoacontinuousimprovementprogram.Importantly,however,thedesignedresultshouldbemeasurable—i.e.,somethingthatcanbemeasured.Itisthismeasurementthatwillultimatelydeterminethequalityandsuccessofthenewprocessdesign.

5.1.2 Why do Process Design?

Processesdefinetheflowofactivityandtheblueprintofhowactivitiesintheworkoperationscometogethertoproduceaproductorservice.Assuchtheydefinewhatwillbedoneandhowitwillbedone.

Butfewprocessesinoperationtodayinmostcompanieshavebeenformallydesigned.Mosthavesimplyevolvedovertimetodeliverspecificproductsorservices.Thisevolutionhasnormallybeenbasedonaneedto“getthejobdone.”And,becauseeverybusinessisdynamic,theneed“togetthejobdone”hasrequiredconstantchangesintheworkandthewayitisperformed.Therefore,inspiteofbeingoperationallysuccessful,mostprocessesarethoughttobelessefficientthantheycouldbe,andinmostcompaniesthisefficiencyconcernhasbothcostandqualityimplications.

Thisisgenerallyacknowledgedtobetrueevenincompaniesthathavebeeninvolvedinbusinessmodelinginthepast.Thesimplefactisthatfewcompaniesunderstandworkatalevelhigherthanabusiness‐unitlevelinotherthanconceptualterms.Althoughthereareexceptions,fewcompaniesunderstandtheirprocessesatadetaillevel—eventhosethatuseBusinessProcessManagementSuites(BPMS)toformalizetheirbusinessmodeling.ThereasonisthatBPMandBusinessAnalysisprojectsinmostcompanieshavetendedtobefocusedatthetacticallevel.However,thisisstartingtochangeandwehaveseensomefirmsactuallytyingbusinessarchitecturetoprocessarchitectureandredesigninordertobetterunderstandtheoperationofthebusinessandhowworktiestostrategy.

Theresultofthisgenerallyrecognizedneedforimprovementisamovetounderstandtheactualbusinessoperationandnotjustatheoreticalconceptofhowthebusinessshouldbeoperating.Thisneedisdrivingagrowingbeliefthateffectivechangemustbebasedonaprocessviewofactivityandanunderstandingofhowtheprocessesinthecompanyreallyoperate.Tosupportthisunderstandingoftheoperation,mostimprovementteamsbeginwiththecreationof“AsIs”or“CurrentState”modelsofthebusiness.Changesarebasedonthesemodelsandanewdesigncalleda“ToBe”or“FutureState”model.Inthischapter,the“ToBe”redesignisdiscussedinthesectiontitled“ProcessandWorkflowDesign.”

MostBPMpractitionersunderstandtheneedforthesemodelstoillustratehowthebusinessworkstoday,toidentifyimprovements,andtodesignhowthebusinesswillworkinthefuture.However,whilemostpeoplehavebeenexposedtobusinessmodels,manyinbusinessandIThavenotbeenexposedtothemodelsortechniquesinthischapter.Manyotherswillalsonothavebeenexposedtotheneedforproblem

Copyright A

BPM


164

definition,ruledefinition,performancemeasurement,simulationmodelingandmorethatwillbediscussedbelow.

Unfortunately,somewillhavebeentaughttheapproachofstartingwithablanksheetofpaperanddesigningfromtheory,anidealoperation.Theproblemisthat,withoutunderstandingthecurrentoperationanditsproblems,rules,andchallenges,theteamwilloftenforgetcriticalbusinessactivities,failtounderstandthecausesofproblems,andwilltendtocreatedesignsthatarenotcost‐oroperationallyeffective.Thesaying“thosewhoignorehistoryaredoomedtorepeatit”appliestobusinessredesign,justasitdoestothelargersociety.ABPMPbelievesstronglyintheneedtounderstandthepastandthecurrentbusiness,production,andtechnicalcapabilitiesandenvironmentinthecompany.Wealsobelievestronglyintheneedtounderstandthecultureofthecompanyandtheabilityofthecompanytoabsorbchange.Thesefactorsareimportantinanynewdesign.

5.2 Process Design Foundation

Inthischapterwewilllookat1)processdefinition,2)howitbreaksintosub‐processes,3)businessfunctions,4)BusinessUnitworkflowsand5)operationalscenarios.Theactualdesignofanewprocess,bydefinition,mustconsideractivitywithoutregardtothebusinessunitsthatperformthework.Thisisduetothecross‐functionalnatureofprocess.Thehigh‐levelprocessconsiderationsmustalsobeviewedatthesubprocesslevelwheretheworkisaggregatedintobusinessfunctionsandthenalignedtothebusinessunitsthatperformthemthroughtheactivitiesthatdefinethem.Withinthebusinessunits,thebusinessfunction’sactivitieswillbecombinedwithactivitiesfromotherbusinesssubprocessfunctionstoformworkflows.Theactualredesignmustconsiderchangeatalltheselevels.Ifallarenotlookedat,changemaybecreatedthatisdamaginginabroadersenseandcanactuallyhurtdownstreamwork.

Thebusinessdesignandredesignactivitiesarethesame:theendpointmustbeanoptimalnewoperatingdesignthatisbuilttochangeiterativelyandrapidlytokeepupwithfuturechangeneeds.Thefivebasicstepsabovewillneedtobeperformedforanylevelofbusinessdesignandforeachiterationinadesignthatsupportscontinuousimprovement.

Differenttoolsandapproachescanbeusedtohelpfocusiterativedesignsandimprovespecificproblemsorquality,buttheyneedtobematchedtotheneedandthegoaltoensurethattherighttoolisusedintherightway.TheseapproachesincludeLean,SixSigma,LeanSixSigma,ActivityBasedCosting,SIPOC,ValueStreamMapping,KaizenEvents,FMEA,ServiceLevelAgreements(SLA),andsoon.ToolsdescribedasBusinessProcessManagementSuites(BPMS)rangeconsiderablyincapability,complexity,andeaseofuse.WhenaBPMSisused,wewillrefertothejointbusinessBPMSITenvironmentasaBPMS‐supportedBPMenvironmentoroperation.

Inapproachingprocessdesign,itisimportanttoknowwhetheryouwillbedealingwithacross‐functionalend‐to‐endprocessoramorespecificproblem‐resolution

Copyright A

BPM


165

effortthatisreallyfocusedonworkflow.Thisdistinctionwillbediscussedinseveralplacesinthischapter,asitiscriticalindeterminingscope,approach,levelofeffort,governance,andbenefit.

Thesetopicsandotherconsiderationsthatshouldbepartofaprocessdesignareprovidedinthediscussionbelow.

5.2.1 Process models are not “Business Architecture” models of the business

AcommonmisunderstandingamongpeopleinvolvedinbusinessmodelingisthedifferencebetweenProcessModelsandBusinessArchitecturemodels.BusinessArchitectsdocreatemodelsofthebusiness,buttheBusinessArchitect’smodelsareatahighlevelofabstractionanddealwithBusinessCapabilities—theabilitytoperformordeliveraveryhigh‐levelbusinessfunction.Anexampleistheabilitytobringanewproducttomarket.Thecapabilityisstatedas“theabilityofthecompanytobringanewproducttomarketwithinaone‐yeartimeframe.”Anotherexample,forapharmaceuticalcompany,istheabilitytoconductclinicaltrialsfornewdrugs,followingalllegalrequirements.

Capabilitymodelsarethusconceptualanddealwiththe“whats”inthebusiness.Processmodels,ontheotherhand,dealwiththe“hows”ofthebusinessanddefinehowadeliverable,product,orserviceisbuiltanddelivered.InthiswaytheCapabilitymodels,whendecomposedtolowlevelsofdetail,definealltheactivitiesthatabusinesswillneedtobecapableofdoing.Sinceeveryactivityrelatesdirectlytoagivenbusinesscapability,thesecapabilitymodelsdefinealltheactivityneededtobeeffective.Theydonothowever,addresseffectiveness.Processmodelsfocusonphysicalactivityanditsmanagement.Thesemodelslookatthewayworkisactuallyperformed.Theyarethusconcernedwithefficiency.

Whencombined,theyallowthedesignertocrossfootthedesignactivitiestoensurethatnoworkisperformedthatdoesnotrelatetothedeliveryofaneededbusinesscapability.Thisensureseffectiveness.Thesecomponentscanthenbeflowedandtheirmanagementimproved.Byaddingautomation,thedesignercanensurethatthedesigndoesnotincludeunnecessaryworkandthattheworkperformedisasefficientaspossible.

Partofthereasonfortheconfusionregardingthesetwomodeltypesisthatinmanycompanies,processmodelsarebuiltbybusinessanalystsinsteadofprocessanalysts.Thetwodisciplineslookfordifferentthingsinthebusinessoperation.

FewpeopleexceptpractitionerswhoareschooledinbothProcessArchitectureandBusinessArchitectureunderstandtherelationshipnotedabove,andmostpeoplewrestlewithboththemeaningofbusinesscapabilitiesandthedefinitionofprocess.Thishascausedablurringof“process”and“capabilities,”suchthatmanypeoplebelieveprocessmodelsarethenextlevelofdetailunderabusinesscapabilitymodel.Asnotedabove,thisissimplynottrue.

Bothdisciplinestrytodeliverbusinessimprovement,andbothhavetheirplaceindoingso.Thefactisthatthesedisciplinescomplementoneanother:theyarenotthe

Copyright A

BPM


166

sameandtheydonotcompete.Bothareneededinanyprocess‐orenterprise‐levelchange.Butinmanycompanies,thisemergingdistinctionisnotyetmadeandtherolesofthesepositionsaresomewhatmuddled,asarethetoolsthateachgroupuses.

5.2.2 The Starting Point

ThescopeofthechangeorimprovementprojectwilldeterminethenatureoftheBPMproject.Ifitistobecross‐functionalandaddresstheentireprocess,thechangewillbemorestrategicinnatureandrequirealong‐termcommitment,astheteamwillneedtoaddressworkinmanydifferentbusinessunits.Aprojectatthislevelisbothinvasiveanddisruptive,asischaracteristicofanylargeproject.Planningandcontrolarealsoverydifferentinaprojectofthisscope.Here,itisworthsuggestingthatoncethehigh‐level“AsIs”modeliscreated,theprojectbebrokenintocomponentsandredesignedinpartsthatwillbemeanttofitbacktogether.Thiswillrequiredesignandmanagementattwolevelstoensurethatallcomponentsdoinfactfittogetherandthattheycombinetoprovideafundamentallynewapproachtoperformingtheprocess.Withchangeatthislevel,associatedsignificantbenefitmustberealizedinordertoundertakethislevelofeffort.

ThesecondlevelofBPMchangeprojectisrelatedtosolvingaspecificproblemoraccomplishingaspecificgoal.Thescopeintheseeffortsisgenerallynarrowandcertainlymuchnarrowerthanaprocessredesignproject.Intheseprojects,changeisusuallyfocusedonworkflow.Thisdistinctioniscritical,anditisakeydifferenceinuseofterms“process”and“workflow”inthischapter.

Processdesignbeginsbycreatinganunderstandingofthewaythebusinessworkstoday—whatisdone,where,whyandhow.Thisfact‐findingisaninvestigationintothedocumentedandundocumentedactivityofthebusinessoperation.Whileitisimportanttounderstandthewaythebusinessworks,itisalsoimportanttounderstandthewaythebusinessshouldwork—intheopinionofseniormanagement.Whatiswrongandwhy?Wherearethehand‐offproblems?Wherearethedecisionproblems?Wherearetherulesundefinedandsubjecttointerpretation?Inperformingthisfact‐finding,theteamwillcollectandreviewallrelevantexistingdocumentationfromthebusinessunit,BusinessArchitecture(ifthisgroupexistsinyourcompany),andIT.Afterreview,theteamwillbeinapositiontolisttheirdocumentation‐relatedquestionsandpreparefortheirinterviewsandworkshopswithbusinessoperationsstaff.

Note:Mostdocumentationwillbeoutofdate,oratbestpartiallyup‐to‐date.Oftennoonewillknowforcertainwhatisaccurate,andmanywillfailtorelatethedynamicnatureofthebusinesstotheneedtokeepbusinessandsystemsdocumentationuptodate.Example:Wewereredesigningabusinessareainalargecompanyandaskedforthelatestbusinessmodels.Themodelswereceivedweredated“2000.”Whenwequestionedtheircurrency,weweretoldthattheywereuptodatebecausethebusinesswasstilldoingthesamething.Wetheninterviewedthebusinessareastaffandupdatedthemodels.Thesewerethenreturnedtothegroupthathadgivenustheten‐year‐oldmodels.

Copyright A

BPM


167

Thisinformationprovidesthefoundationforthefirstlookatwhatmaybewrong,missing,under‐supportedorfunctioningincorrectly.Butmostimportantly,itprovidesthechangeteam,management,andbusinessstaffwithaclearandagreed‐uponunderstandingofhowthebusinessreallyworks.Italsoprovidesanunderstandingofhowmanagementenvisionsthebusinessunittofunction.Theanalysisofthe“delta”betweentheactualandtheexpectedbusinessoperationprovidesguidanceforthehigh‐levelrequirementsofthechangeandthenewdesign.Italsopointsoutwherethenewdesignmaywanttostartandwhatshouldbegivenahighpriority.

Ofcoursebridgingthesegapsisfertilegroundforfinding“low‐hangingfruit”changes.Theseareactions,rules,approaches,work,etc.,thatdonotneedtobeperformed,areredundant,orareinoppositiontomanagementexpectationsorthewaymanagementseesthebusiness.

5.2.3 Defining Data Collection Standards

Inanyenterpriseorfullprocessleveleffort,thecompanywillneedasignificantstaffofBPMpractitioners,alongwithotherdisciplines.ForthepurposeoftheCBOK,wewillfocusonBPMandBPMpractitioners.Heretherewilllikelybemultipleteams,andwithintheteams,multiplepairsofpeoplewhoperformtheinterviewsorworkshops.Differentpeoplewilllookatactivity,rules,problems,andmore.Experiencehastaughtusthatitisimperativethattheinformationcollectedbeconsistentacrosstheeffort.Ifitisnot,qualitywillbesuspect,importantinformationmaybemissing,anditwillbeimpossibletoprovideanaccuratepictureofthebusiness.

Clearlyonasmallerscale,butstillimportant,istheneedtostandardizethecollectionofinformationattheworkflowlevelor,lower,tothetasklevel.Thesamedriverappliesatthislevelasattheprocessorenterpriselevel—theneedtocreateaclearunderstandingoftherealbusinessoperation.

Todothis,formalinformation‐collectionstandardsmustbeputinplace.Thesedealwithwhatinformationwillbecollectedfromwhom,thewaytheinformationwillbevetted,thewaytheinformationwillbestoredandorganized,thewayitwillbechanged,andthewayitwillbeused.

Ifthecompanyhasprocess‐relatedmodeling,datacollection,andotherstandards,theywillneedtobefoundandfollowed.However,fewcompanieshaveBPMinformation‐discovery,modeling,datacollection,interviewingandotherstandardstocontroltheapproachtakenincontrollinginformationaboutthecompany’soperation(otherthanfinancialregulatorystandards)andevenfewerhavestandardsdealingwiththedeliveryofbasicmodelingandinformationconsistency.Withoutthesestandards,eachgroupofinterviewersandeachprojectteamwillcollectdifferentinformation,andeachmodelwillfollowdifferentmodelingconventions.Suchinconsistencyhasproventocauseproblemsincreatinganenterprisebusinessmodelandindrivinganalysis,costing,benefitanalysis,performancemeasurement,anddesignsimulation.

Copyright A

BPM


168

ForteamsusingaBPMStool,themodelswillforcethecreationofstandards—ifanyoneistoevermakesenseofthemodelsatanylevelofdetailandbeabletoaccessthedatathatisstoredinthetool.However,iftheuseofthesetoolsisnotgovernedbystandards,theteamsmaystillfailtocollectalltheneededinformationortovetit.Evenwithstandards,compliancereviewsareimportanttoenforcetheiruseandensurequality.DefiningstandardsforBPMS‐supportedBPMprojectsbeginswiththeacceptanceofusestandardsprovidedbymanyofthevendors.Thesestandardsareastartingpoint.Theywillstillneedtobemodifiedtosupporttheinternalbusinessoperatingstandards,theITstandardsneededfortheBPMStoruninthecompany’sITtechnologyenvironment,andforthemodelstoconformtocompanyprotocols.Whilethesestandardsareneededtoensuresecurity,access,consistencyandmore,theybecomecriticalinacollaborativeenvironmentwithteammembersandbusinessunitslocatedaroundtheglobe.

WhereaBPMSisnotused,itisimportanttodeterminewhatinformationwillbeneededforallprojectsandtomakethisstandard.Heretheteamwilllikelyuseamodelingtool,aspreadsheet,apresentationtool,andawordprocessor.Thiswillserveasacoresetofinformationtoensurethataminimumunderstandingoftheoperationcanbeconstructed.Individualprojectswillbeexpectedtoaddproject‐specificinformationtothisstandard.ThisistrueforbothaBPMS‐supportedeffortandamanualeffort.

Fromaninformation‐collectionandstorageperspective,therealproblemwhereaBPMSisnotusedinvolvesinformationorganizationandchangecontrol.Findinganythingbecomesdifficultwhentheprojectislargeenoughtorequireseveralpeopleormultipleteams.Thepeoplesimplycollecttoomuchinformationtoorganizeforeasyaccess.Controllingchangeoverthelifeoftheprojectisalmostimpossibleintheseprojectsandrequiresthecommitmentofprojectresourcesservingaslibrarians.Ofcourse,thisisaluxurythatfewprojectshave.

Indefininginformation‐collectionstandards,itisalsoimportanttodefinetheusethatthemodelsandinformationwillbeputto.Forexample,ifthemodelswillbeusedtosimulatethecurrentoperationandtheoperationsassumingcertainchanges,itisnecessarytodefinethedatathatwillbeneededtodrivethesimulation.Thisisimportantbecauseitwillmakecertainallneededinformationtodefineabaselineiscollectedduringtheanalysisactivity.Bydefiningandthenobtainingthisinformationduringtheanalysisactivity,theteamwillbeableimprovethequalityoftheanalysiswhilelimitingthenumberoftimestheywillneedtointerviewtheusers.

Forthisreason,itisstronglyrecommendedthatanyBPMprojectbeginwiththeidentificationofstandardsthatmustbeusedandthecreationofproject‐specificstandardsthatareneededtoprovideconsistencyamongtheproductsproducedbydifferentteammembers.

Inaddition,manyprojectssufferfromterminologydisconnects.BPMandBPMSacronymsandterminologydifferfromcompanytocompanyandfromprojectteamtoprojectteamwithinacompany.Partofthereasonisthattherearefewcommonly

Copyright A

BPM


169

accepteddefinitionsformostthingsrelatedtoBPMandbusinesstransformation.But,asmuchtroubleasthissituationcauses,theuseofinternaltermsbetweenbusinessunitsanddifferingdefinitionsofthesetermscausesmuchlargerproblems.Experiencehasproventhatevensimple“everyoneknowsthat”terminologymustbedefinedsoitcanbeusedconsistentlybetweendepartmentsandbetweenthebusinessandBPMteams.Thesedefinitionsmustbeagreeduponbythebusinessmanagers,IT,andcollaborativepartnerssothateveryonecanstayinsync.But,thisalsorepresentsasignificantculturalandpoliticalproblem.Whosedefinitionwillbeconsideredrightandthusgenerallyused?Thefactis,creatingthisdictionaryisnotasimpletask.

However,untilallterminologyandacronymusagehasbeenagreedupon,information‐collectionstandardswillprovidelimitedsuccessinallowingeveryonetounderstandhowthecompanyoperatesandhowitcanbeimproved.

5.2.4 Managing Process Design

Thissectionofthediscussionisnotconcernedwithprojectmanagement.WithconsiderationfortheuniqueBPMandBPMStasks,projectplanningandmanagementisbasicallythesameinBPMprojectsasitisinprojectsusingotherdisciplines.AlthoughthetasksinaBusinessProcessManagementSuite(automatedmodelingandapplicationgenerationtool)‐supportedBPMprojectaresomewhatunique,thenormalprojectmanagementdisciplinewillprovideadequatecontrolandmanagement.

BecausetherearefewformalBPMapproachestodayinmostcompanies,projectteamsarelargelyallowedtodefinetheapproachthatwillbeusedintheirproject.Theresultisthatinmostcompanies,eachBPMprojectisapproachedandperformedsomewhatdifferentlythananyothers.Asexpected,eachoftheseapproacheswillhavestrengthsandweaknesseswhenviewedinthecontextofthecompany,itsculture,anditsITsupport.Tobenefitfromthisexperience,companiesshouldreviewpastBPMprojectsanddefinetheirapproachesforuseaslessonslearned.Thiswillhelpcreateabestpracticesapproachwithinthecompanyanddefineacompany‐specificmethodologythatwillensureaccuracy,qualityandsuccess.Forthosewhowishtotakeamorestrategicapproach,thisalsohelpsensurethatallrelevantinformationhasbeencollectednotonlyfortheproject,butalsotomeldwithinformationfromotherprojectstoformenterprise,orend‐to‐end,processmodels.

Anyapproachtakenshouldthusbestandardizedandpresentedtotheteamasthecompanystandardthatwillbeusedandauditedinmovingforward,firstintothedata‐collectionandanalysisactivityandthenthroughouttheremainingeffort.Asnoted,anyapproachandmethod,especiallywhennewtothecompanyand/orteam,shouldbemonitoredtoensurethatitisbeingfollowed.Thiscontrolmaybeprovidedbyaprojectmanagementoffice/grouporbyaBPMCenterofExcellence.Ifthisisdone,everyone’sworkwill“fit”togetherandeveryonewillbeabletounderstandanyofthemodelsorinformation.

Copyright A

BPM


170

Further,toavoidoverhead,themethodfollowedshouldbecustomizabletoeachprojectandreflectthecomplexity,scope,importance,andbenefitoftheproject.Thismethodwillthenbeusedtoguideprojectplanningandbemergedwiththecompany’sapproachtoprojectmanagement,inordertoprovideafocusedprojectplan.

Clearly,theneedforconsistencyofapproachandinformation‐collectionrequiressomeformofmanagementactioninadvanceofactivity.Thisisthefoundationformanagingtheactivitythatwillbeneededtobuildthe“AsIs”and“ToBe”processdesignsandmaximizetheimpactandvalueofeachactivityperformedinthisdevelopment.

5.3 Process Discovery –The “As Is” or “current state”

Asmentioned,anychangemuststartwithanunderstandingofthecurrentsituation,operation,constraints,politics,andmore.Thiscannotbeomitted.Youcannotsimplystartoverasifthecompanyanditsoperationhavenohistory.Itisalsoimportanttonotethatnocompanyoperatesinavacuum.Anycompanyisacomplexnetworkofcustomers,suppliers,collaborativepartners,workers,rules,financialhistory,marketreputationandmore.Together,theseformthecompany.Anychangecannotignorethem.Thisiscriticalindesigninganimplementablechangeorchangeroadmapthatwillguidetheevolutionofthecompany.

5.3.1 Creating a firm foundation for change

Understandingthishistoryandthecurrentoperationisthefoundationforanynewdesign—regardlessofitsscopeofimpact.Thenewdesignitselfmustsolveexistingproblemsandallowthebusinesstotakeadvantageofknownanddiscoveredopportunities.Attemptstoskiptheinitialanalysisandbusinessredesignactivitydelivermixedresults—fromsolutionsthatjustdon’tworkthewaypeoplethoughttheywould,tosolutionsthatactuallymakethingsworse.So,atthispoint,wewillacceptthatthisinformationisneededandunderstandthatitiscritical.

Tohelporganizethisinformationandmakeitrelevant(provideacontextforunderstandingitsmeaningandimpact),itisrecommendedthatanyimprovementadoptaprocessperspective.Thisperspectiveincludesthepotentialprocessesthatareinscope,thebusinessunitstheprocess(orprocesses)flowsthrough,theimpactofits(ortheir)activitiesoneachbusinessunititflowsthrough,theproblemsassociatedwiththeprocess(es),andthepotentialimpactofgivensolutionoptions.

Experiencehasproventhatanynewoperationaldesignmustconsiderthehistoryofthecompany,theproblemsandlimitationsthatboxanyimprovement,thebudgetaryrealities,thecultureanditsabilitytoabsorbchange,theinteractionsbetweenbusinessunitsandprocesses,therelationshipbetweenthecompanyanditsbusinesspartnersanditsapproachtocollaborationandpartneringwithsuppliersandcustomers.Thesefactorsandmorearevitalindesigninganyimprovementsolution.

Copyright A

BPM


171

Theidentificationanddefinitionofthesefactors,whenaddedtothemodelsoftheprocessandtheworkflowsinthebusinessunits,formsaknowledgefoundationforchangeandworkoptimization.Theresultofthisknowledgefoundationisthecreationofaverydifferentperspectiveonthebusiness’soperation.Theend‐to‐endperspectivethataprocessviewprovidesallowsmanagementtounderstandthescopeandimpactofproblemsandwheretheystart.Thisiskeyinredesigningproblemsoutofexistenceor,iftheyarerelatedtothingsthatcannotbechanged(awholenewcomputerinfrastructureorlegislativemandate),buildingatypeofoperationalshellaroundtheproblems,whicheffectivelycontrolsthem.

Withthisfoundation,itwillbepossibletomovetoanoperationmodelthatisbasedonlearningandcontinuousimprovement.TheframeworkthattheprocessandworkflowmodelsprovideallowsperformanceengineerstoutilizedisciplineslikeSixSigmaandLeantodefineimprovementopportunities,andtechniqueslikeperformancemeasurementandmonitoringtoidentifyimprovementobjectives.

Thisprocess‐centricperspectiveisequallyimportantwhenaddressingproblemresolutionprojectsusingBPM.Theneedsandbenefitsaresimilarandessentiallyarethesameastheworkflowviewintheprocess‐centricdecompositionhierarchy.

5.3.2 Managing Process Information

Astheinformationiscollectedandanalyzed,theteamwillneedtoorganizeandconsolidateavastamountofdata.Today,popularmodelingtoolsthatincludeVisio,ormoreadvancedmodelerslikeCasewiseandthetoolsincludedinBusinessProcessModelingSuites,areusedtoprovideacommonrepositoryforthisinformation.Whilesupportingitstranslationintoaflow‐modelformat,thesetoolsofferagraphicalrepresentationoftheinformationatvariouslevelsofdetail(processdecomposition)—showingsubprocessesand,atlowerlevelsofdetail,activitiesandeventasks.Whilethesemodelingtoolsallowthemodelertoshowtheworkandworkflowinaneasilyunderstoodmanner,theyarelimitedintheirabilitytohelpdesignthenewbusiness.

MoreadvancedfullBusinessProcessModelingSuites(BPMS)providemodeling,rulesmanagement,workflowmanagement,performancemeasurement,applicationgenerationanddatahandling(throughServicesOrientedArchitecturetools).Thesetoolsareextremelyflexibleandofferasignificantgroupofadvancedfeaturesthatpuremodelingtoolscannotprovide.Theteam,thedatathatiscollected,thewaythedataishandledandthelevelofdetailthatiscapturedwill,toalargedegree,bedependentonthetoolthatisusedtosupporttheteam.Thiswillalsodeterminetheamountofdatathatcanbedealtwithandthewaytheinformationcanbestored,retrieved,andconsumed.

Butregardlessofthetoolusedtosupportmodelingandinformationcollectionandanalysis,thedesignteamwillneedtoorganizetheinformationintoeasilyunderstoodgroupsofrelateddocumentsandmodels—startingwiththewaythebusinessworkstoday.Thisisthe“AsIs”modelanditssupportinginformation.ABPMprojectteamshouldconsiderthetoolsthatwillbeavailableandtheircapabilitieswhentheyformulatetheirprojectstrategyandplan.Astheinformation

Copyright A

BPM


172

isbeingcollectedandthemodelsarebeingbuilt,theteamwillneedtoconsiderthewaythemodelswillbestructured.Itisveryeasytolookatvirtuallytheentirebusinessasasinglelargeprocess.Itisalsoeasymakemodelssocomplexthatnoonecanpossiblyunderstandthem.Whilemodelingstandardswillhelp,aswilltheuseofastandardsetofmodelingsymbolssuchasBPMN(businessprocessmodelingnotation),thestructureandarchitectureofthemodelhierarchyandthemodelsthemselvesarecriticaltotheiruse,theabilityoftheteamtoconfirmthemwiththebusinessusers,andthentoleveragethemindefininganewdesign.

Example:ManycompaniesanddepartmentswithincompanieshaveusedVisiotobuildprocessandworkflowmodelsinthepast.BecausepastversionsofthistoolwerenotbasedonBPMN,anysymbolscouldbeused—people,machine,andothergraphicsymbolswerecommonlyused.Theresultisthatthesymbolswereusedinconsistently,andwithoutsignificantnotationonthediagram,theyaredifficulttointerpret.Whentheteamthatcreatedthemodelisnolongerpartofthecompany,usingthemodelsbecomesaproblem.

Thesameneedforconsistencyisseenintheinformationthatiscollectedtodescribethemodelanditsactivitiesindetail.Thisinformationmayincludetiming,volume,decisionprobability,errorrates,staffinglevel,rules,andmore.

5.3.3 Model levels

Processinformationdiscovery,asdiscussedabove,willhavediscoveredinformationatvariouslevelsofdetail.Theselevelsofdetailwillneedtobesortedoutandtheinformationassignedtodifferentlevelsinaprocessmodelhierarchy.Thishierarchywillbeginatahighlevelwiththeentireprocess,andthenbebrokendownordecomposedintolowerlevelsofdetailuntiltheactivitiesinaprocessaredefined.Inthisdecompositionoftheprocessmodels,theprocessisdividedintosubprocessesandthenfunctions.Thefunctionsarethenrelatedtothebusinessoperationwheretheyareperformed,andcombinedwithothersubprocessworktoformtheactivitiesinthebusinessunit.Thesearethenflowedtorepresentthewayworkisperformedinthebusinessunit.

Itissuggestedthattheinformationbeassignedtoagivenlevelofdetailasitiscollected.Thisassignmentcanbechangedastheteamlearnsmore.Theinformationatanylevelinthehierarchyshouldbeclearlyalignedtoinformationatahigherlevelinthehierarchy,andthusrepresentadditionaldetailasonegoeslowerinthehierarchy.Thiswillallowtheteamtoidentifymissinginformationorinformationthatneedstobequestioned.

Thefollowingdiagram(Figure42)isanexampleofaprocesshierarchy.Differentfirmsmayusefewerormorelevelsandmaylabelthemdifferentlythaninthisexample.Theimportantfactisthattheteamwillneedawaytoorganizetheinformationcollectedandthemodelsthatarebuilt,ifthereistobeanyhopeofcontrollingtheinformationanditsquality.

Copyright A

BPM


173

Figure42.ProcessHierarchy:LevelsofDetailinProcessModeling

Note:Thenumberoflevelsandtheirnameswillvarybythemethodsandnamingconventionsusedindifferentcompanies.Theimportantfactisthattheprocessmustbebrokenintoalowenoughleveltounderstandtheactivitiesthataretakingplaceandhowtheyfittogethertoproducethebusinessunit’sendproducts.Thelevelsinthediagramabovearethusasampleofhowacompanymightlookatdefininglevelsofdetailintheprocessmodelingstandards.

Thenumberandnameofthelevelsinboththecurrent“AsIs”andthefuture“ToBe”modelsshouldbedirectedbyformalbusinessmodelingstandards.Inthepast,thesestandardscouldbeindependentofanyexternalmodelingstandardortool,butthatischanging.Caremustnowbetakentoaligninternalmodelingstandardswiththetoolsthatareusedandtheircapabilitiesandlimitation.Forexample,whileitisnottheonlymodelingstandard,BPMN2.0isbecomingamajorstandardforBPMSvendors,andinternalmodelingstandardsmaywellneedtoconformtoBPMN.However,agoodruleofthumbinlookingatmodelingstandardsisthattheyaddressatleastthefollowinglevelsinsomeform:

1. Thehighestlevelmodelisaprocessmodelthatprovidesafullend‐to‐end,high‐levelviewoftheprocess.Thismodelcanshowsubprocessesandmayshowhigh‐levelproblemsandapplicationsystems.

2. Subprocessmodelsarethenextlevelanddividetheworkintobusinessfunctionsandthenalignthebusinessfunctionsbybusinessunit.

3. Workflowwithinabusinessunitisathirdlevel,anditidentifiestheactivitiesthatareperformed.Thislevelmodelcanalsobeusedtoshowthe

Level1:Process

Level2:SubProcess

Level3:BusinessFunction

Level4:WorkflowinaBusinessUnit

Level5:TasksandScenarios

ShowsSubProcessesandtheirrelationshiptooneanother

ShowstheBusinessfunctionsinaSubProcessandtheirorderofexecution

ShowstheBusinessUnitsthatperformtheworkinaBusinessFunctionandthewayworkflowsbetweenthem

ShowstheactivitiesthatareperformedintheBusinessUnitandtheirorderofexecution

Showstherealworkthatisperformedandhowitclumpsintolikeworkgroupsorscenarios

Copyright A

BPM


174

relationshipbetweenactivities,withactivitiesfromotherfunctionsandsubprocessesthatarealsobeingperformedinthebusinessunit.

4. Atthefourthlevelofdetail(scenarios)itwillbeeasytounderstandhowworkthatisperformedinthebusinessunitisdrivenbyeventsortimingordatavalues.Byrollingthetaskuptoactivities,thenuptoworkflowandthentosubprocesses,itiseasytoseehowallworkfitsintoprocessesandhowitplaysaroleinproducingtheendproductoftheprocess.

Butthisfourthlevelofdetailprovidesonlyabasicunderstandingofthedetailinthebusinessoperation.Itisoftennotasufficientlevelofdetailtoresolveproblems,reducecost,orsupportautomation.Fortheseactions,itisnecessarytotaketheworkflowtoagreaterlevelofdetail,thetasklevel.

Atthis(fifth)level,thebusinessandBPMSdesignerswillusuallyhaveenoughdetailtotierulestospecificactions.Theuseofdatawillnowbeatalowenoughlevelofdetailtodesignapplicationscreensandreports,anddefineeditsandlow‐leveldecisions.ThislevelisusedtogenerateBPMSapplicationsthatmanageworkandautomatemanual“transaction”‐leveldataentryanduse.

Thisisthelevelwheretheanalystidentifiesthetasksthatareperformedtodelivertheoutputoroutcomeofasingleactivity.Forexample,whenaninsurancecompany’spolicyholderintothesystem,thislevelofthemodelwilldefinethetasksthatmustbeperformedtoenterthenewpolicyholder.Anotherexampleatthislevel,inmanufacturing,wouldbebuild‐to‐order,afteracustomerplacesanorderwithasalesperson.Theprocessanalystmustdefineallthetasksneededtoidentifythe“customized”product,and—assumingabuildfromcommonparts—toidentifytheparts,definetheoptions,cutthebuildorder,gettheparts,andthenconstructit.

Andyes,therearestilllowerlevelsofdetailthatmaybeneeded.ThekeyistotakethemaptothelevelthatyouneedtosupportwhatyouaredoingANDwhatsomeoneinthenextphasewillneedtodo.Thismaybetobuildanapplicationusingtraditionallanguages,generateaBPMSapplication,buildinterfacestolegacyapplications,buildwebapplicationstointeractwithcustomers,andmore.Thekeyisthattherequirementsforanyofthesefollow‐onactivitieswillneedtobeconsideredandthedetailneededtodrivetheircompletionmustbereachedinthemodels.

Thispresumesthat(atleast)attheprojectlevel,theprojectmanagerwillbegintheprojectbydefiningthedeliverablesandthensettinginternalstandardsfordatacollection,interviews,models,etc.Ofcourse,ifcompanystandardsexisttoaddressthisissueofconsistency,theywillneedtobefollowed.

Seechapter3,ProcessModeling,foramoredetailedlookatthewayprocessmodelsareconstructed.

5.3.4 Process and Workflow Discovery

Anychangemuststartwithafirmunderstandingofthewaythebusinessoperatestodayanditsproblemsandchallenges.Thisfoundation,however,isaconstantlychangingpictureasthecompanyadjuststobusinessrealityandcompetitive

Copyright A

BPM


175

pressures.Forthisreason,thewaythebusinessoperatedsixmonthsagoisprobablynotexactlythewayitworkstoday.OldmodelsandoldinformationfromIT,BusinessArchitecture,orProcessArchitecturearealmostalwaysoutofdateandcancauseharmtothenewdesignifused.Forthisreasonitisnecessarytoalwaysbeginwitharevalidationofexistinginformationandwhereneeded,anextensionoftheinformationandmodelstoshowtheoperationasitfunctionstoday.

5.3.5 The way the operation really works

Thequestionmanyaskis“whydoIneedtobeconcernedwith“AsIs“models?Iamchangingthecompany,whynotjustfocusonthefuturestate?”Thesimpleansweristhatyoumustunderstandtheoperationbeforeyoucanchangeit.Youcannotjustproduceanewconceptualfuture‐statemodelandexpecttoimplementitwithoutbuildinganabilitytomovefromthepresenttothefuture.

Partofthereasonforthisneedtounderstandthecurrentbusinessoperationcomesfromthefactthatfewbusinessesoffertrue“greenfield”designopportunities.Mostofthetime,thedesignteamwillnothavetheluxuryofdealingwitheithertheentirebusinessoratotallynewdepartmentandmustconsiderthecurrentbusiness,itslimitations,itsproblems,costs,anditsculture.Tolimitthedesignoptionsevenfurther,theteamoftenfacestherequirementtoconsiderchangestothebusinesswithoutthebenefitofbeingabletoaffectthebusinessoperationcomponentsprecedingorfollowingthepartofthebusinessbeingchanged,inthelargerprocesscontext.

However,whenaprojectdoesprovideanopportunitytoworkonatotallynewbusinessoperationoranentireend‐to‐endprocess,theteammayproceedwithoutmanyoftheconcernsthatlimittheteamschangingabusinessoperation.Here,theteammuststillconsiderhowthenewoperationwillfitintothebusinessandhowitwillbesupportedbyInformationtechnology(IT).So,eveningreenfielddesignopportunities,thedesigncannotbetotallywithoutconstraints.

Forthesereasons,itisnotpossibletosimplyviewthechangeasifyouwereabletostartover,withnocorporatehistory,noculturetodealwith,nolegacyITlimitations,nocostlimitationsandnoconsiderationforthepartsofthebusinessthatsimplyarenotpartofthedesignproject’sscope.Giventhisreality,itiscriticalthatthedesignteamunderstandthecurrentoperation—atbothhighandlowlevelsofdetail.

Inaddition,fewpeoplereallyknowhowtheworkinawholeprocessorbusinessunitisactuallyperformed.Managersobviouslyhaveagoodidea,butgiventhatmanyrulesarecreatedasneededtoaddressunautomated“whitespace”workandthatmostrulesareinterpretive,noonecanguaranteethatanyactivitywillbeperformedthesamewaytwice.Thisisareasonoutcomeconsistencyisaprobleminmanycompanies.

Note:Creatingacompleteunderstandingofthebusinesscanhaveanimmediatebenefitfromstandardizingrulesandpartsoftheworkflow.Itcanalsohelp

Copyright A

BPM


176

managementmakeimmediatedecisionsthatcanimprovetheoperationbeforetheworkflowanalysisbegins.

Thus,thedesignofanynew(“ToBe”)businessmodelmusttakeintoaccounttherealitiesofthecurrentbusinessoperationandtheproblemsandopportunitiesthatexist.Itmustalsoconsiderthecurrentbusinessrules,timingrequirements,theneedtobalancetheworkloadamongthestaff,therealitiesofcorporatepoliciesandstandards,reportingrequirements,auditrequirements,andmore.Thesefactorsareidentifiedanddefinedintheanalysisofthecurrent(“AsIs”)businessoperationthroughthecollectionandreviewofoperationalinformation.

Thisanalysisofthe“AsIs”businessmodelsandinformationisthefirstpointwherecreativityandbusinessacumencomeintoplay.Astheanalystsarereviewingtheinformation,theywillhaveanopportunitytonoticeinconsistencies,activitiesthatjustdon’tmakesense,andopportunitiesforimprovement.Thisisthebasisforrecommendedchangeanddesignimprovements.Theseimprovementswillgenerallyfallintotwocategories—candidatesforfast,inexpensive,immediateimprovements(“low‐hangingfruit”)andlonger‐term,moreinvasive,moredisruptive,andmorecostlyimprovements.

Existing“currentstate”or“AsIs”ProcessModelsshouldhavebeenupdated,iftheyexistinthecompany,forthebusinessarea(s)thatareinscopeduringtheinformationdiscoveryandmodelingactivity.Iftheydon’texist,theywillhavebeencreatedduringthisdiscoveryactivity.Thesemodelsthusprovideafoundationfortheanalysisofthecurrentoperation.Butthatisthebeginningofitsuse.

Seechapter3,ProcessModeling,fordetailsoncreatingprocessmodelsatanylevelofdetailinthemodelinghierarchy.

Itisrecommendedthattheprojectteamalsoviewthiscurrentinformationfromastrategicperspective.Thereasonisthatinformationcollectionisgenerallyproject‐focused;itisoftennotmeanttohavealifebeyondtheproject,oritsimplycannotbemaintainedandbecomesoutofdate.UsingaBPMapproachandsupportingBusinessProcessManagementSuite(BPMS)tools,thissituationchanges.TheinformationfromeachprojectcanbeaddedtoacommonEnterpriseDatabasewiththeeventualgoalofprovidingacompleteprocess‐centricviewofthecompanyanditsoperations—thewayitreallyworks,notsimplythewaysomethinkitworks.

Project‐levelcontentshouldbeusedtosupporttheeventualcreationoftheEnterpriseBusinessModel.Doingsoremovestheoverheadofcreatingthiswholemodelasaprojectinitself.Tosupporttheevolvingenterprisemodelingeffort,itisrecommendedthatthebusinessprocessmodelsincludethefollowingsupportinginformation:

Processesshowingsub‐processesandtheirinteraction Subprocessoperationsshowingbusinessfunctions/scenariosandthe

businessunitsthatperformthem

Copyright A

BPM


177

Workflowwithinabusinessunitshowingactivitiesthatareperformed—thismaybebrokenintolower‐levelmodelstoshowthetasksthatareperformedwithinactivities.

Note:theselevelsofmodeldecompositionformtheprocessmodelinghierarchy.

Problemsandtheirimpactalignedtotheoneormoresub‐processes,businessfunctions,activitiesortaskstheyaffect

Opportunitiesforimprovementandtheexpectedbenefitsalignedtothepartofthebusinesstheyaffect

Metrics(staff,volumes,errorrates)alignedtothepointinthebusinesstheymeasure

ITapplicationsthatareusedandwheretheyareusedinthebusiness Basicfunctionalitythateachapplicationsystemprovides Datathatiscollected,whereitisstored,howitisedited,andhowitisused Rulesthatcontrolthework—bothdocumentedandundocumented Decisionprocesseswiththeprobabilityofeachexitfromadecision Standardsforquality/cycletime/efficiencyetc., Internalauditpolicyandanyrequirements Performancemeasurementrequirements

Note:thisisapartiallistoftheinformationthatshouldbecollectedaspartofcreatingthe“AsIs”processandworkflowbusinessmodels.ItisalsothecoreinformationthatshouldbeconsideredinbuildinganEnterpriseBusinessModel.

Thekeypointhereisthatwithforethoughtastotheeventualuseofthisinformation,itwillbepossibletouseitbothincreatingthesolutionthatisthetargetoftheprojectandintheincrementalconstructionofaprocess‐centricenterprisebusinessmodel.

5.4 Strategic Business Change

ChangesinbusinessstrategyandintheBusinessandITcapabilitiesthatwillneedtochangetosupportthenewstrategyarekeydriversofbroad‐basedbusinessoperationchanges.Thesechangesrequirethesametypeofdiscoveryactivity,butworkingtogetherwiththeBusinessArchitectsandProcessArchitectstodeterminewhatprocessesandwhatpartsofprocessesneedtochange,andhow.Thisprocedurewillthenbefollowedfromsubprocessestobusinessfunctiontobusinessunittohelpdefinethescopeoftheproject.

OncetheBusinessandProcessArchitectshaveisolatedthebroadareasthatwillchange,theywillneedtoworkwiththeEnterpriseArchitectstodeterminetheimpactontheITinfrastructure,thesupportingapplications,thecompanydataandtechnologygovernance.Together,theseperspectiveswillformacompletepictureoftheneededchanges.Thisinturn,allowsthesearchitectstoidentifytheinitiativesandprojectsneededtodeliverthestrategyandsupportitsgoals.Theseinitiativesandprojectscannowberelatedtospecificbusinessunitsthroughprocesschangesandtherequirementsthateachchangemustsupport.

Copyright A

BPM


178

Instrategy‐drivenchange,itiscriticalthatallchangescanbetracedtodirectlysupportingthedeliveryofagivenpartofthebusinessstrategy.Theanalysisofanyresponsetoastrategicchangemustthusincludealignmenttostrategicgoalsatalllevelsofdetail(decompositionmodellevels).Thisissupportedthroughtherelationshipsbetweenstrategyandinitiatives,andbetweeninitiativesandprojects.Attheprojectlevel,theworkbecomesfocusedonthechangesneededinabusinessunitanditsworkflows.

Formallydefiningtherelationshipsbetweenchangeprojectsallowsexecutivemanagementtolookatprojectfundingdifferentlyandfacilitatesatypeofprogrammanagementthatcoordinatestheactivitybetweenprojectsandbetweeninitiativestoensurethatthegoalsofanystrategyaremet.

5.5 Process Analysis—Gaining an understanding of the business

Questioneverything.Nothingcanbeexemptinthequestforimprovement.

Thetruthshouldnotbehiddeninthisanalysis—althoughpoliticswillplayitspart.Wheretherearepoliticalboundaries,theprojectwillneedtobeadjustedtoworkwiththerestrictions.

Thepurposeoftheanalysisistoidentifyhowthebusinesscanchange,therestrictionsonit,andfocuspointsinthechange.Thedesignteamwillusethisinformationtofocusoninitialimprovementconsiderationsoronstrategicchanges.

Oncethe“AsIs”informationcollectionandprocess/workflowmodelingisunderway,analysisactivitycanbegin.Althoughthereisnoonebestwaytoanalyzethisinformation,itissuggestedthatareviewofincominginformationbeusedtocreateatypeofframeworkthatallowstheteamtoaligninformationandbusinessactivity.Careshouldbetakeninthisalignmenttolookforobviousopportunitiestoimprovetheoperation,suchasredundantactivity,activitythatisuncontrolled,activitythatjustdoesn’tmakesense,activitythatprovideslittleornorealvaluetotheprocessortothecustomer,andunnecessaryhand‐offstootherdepartmentsorholdsforapproval.Theseshouldbeanalyzedandevaluated.Itisalsosuggestedthattheteammeetdailytodiscusswhatitisdiscovering.Thiswillallowtheteamstomoreeasilyrecognizepatternsandredundantactivity.

Itisalsoappropriatetolookatthedeliverablesofabusinessunit,businessfunction,orsubprocess.Allworkmustcontributetooneormoreofthesedeliverables.Ifitdoesn’t,itmustbereviewedandanalyzedforvalue.

Allproblemsmustalsobeclearlyidentifiedanddefined.Theymustthenbelinkedtothebusinessactivitiesandbusinessfunctionstheyaffect:theimpactshouldbenotedandtheimpactassessmentsignedoffonbyabusinessmanager.A“ProblemMatrix”shouldbecreatedtoshowtheresultsofproblemanalysis(seeFigure43).Thismatrixshouldshowtheproblemandtheplacesitimpacts.Theplaceonthematrixwheretheproblemandtheplaceimpactedcometogethershouldshowthespecificimpact.Thiswillhaveawidevarietyofusesinthenewdesign.

Copyright A

BPM


179

BusinessUnitXWorkflowActivity

Claims

ClaimentryCust.—Callwithclaim

Claims

ClaimAdjudication—Findpolicy

Claims

MedicalReview—Evaluateclaim

ProblemName/ID

1.1Cannotfindtherightcustomereasily Cannotcomplywithtimestandard

1.2Cannotseeclaimhistorywithoutwaitingfordocretrieval

Makedecisionswithoutneededinformationtohittimestandards

1.3OutdatedMedicalpolicy Overloadexaminerswithpolicyquestions

Figure43.ProblemMatrix

Inadditiontoproblems,allbusinessimprovementopportunitiesidentifiedduringinterviews,documentationreview,ormodelreviewshouldbenotedalongwiththeprobableimpactoftheirimplementation.ThisrelationshipshouldbeshowninanOpportunityMatrixwiththeopportunitiesalongoneaxisandthebusinessunitorgroupthatwillbeaffectedalongtheotheraxis(seeFigure44).Theintersectionwillshowtheimpactofthechangeonthebusiness.

Figure44.OpportunityMatrix

BusinessUnit

Sales

FieldSalesStaff

Sales

OrderEntry

Sales

OrderProcessing

ImprovementOpportunity

5.1Onlineaccesstodiscountinformation

Improved

competitivenessest.10%salesincrease

Improvedabilitytoholdquotedprice—est.increaseof$50Minrevenuefromexistingsales—smaller$lossduetoincorrect

discounts

5.2Onlineaccesstomeetingplanningfromthe

field

20%productivityincreaseduetotheabilitytoreschedule

quickly

DiscoveryDataAnalysis

ProblemMatrix

Copyright A

BPM


180

Theteamshouldalsolookattheflowandthewayitismanaged.Considerationshouldbegiventosuchimprovementsasworklisting,workflowmonitoringandmanagement,standardtrackingwithtime‐basedwarnings,automatedworkassignment,andworkload‐shiftingtobettercontrolworkloadbalancing.

Whiletheseandotherbusinessoperationanalysesareunderway,itisalsoappropriatetolookintoITsupportanddeterminethelimitationsofIT’scapacitytosupportthecurrentandpossiblefuturebusinessoperation.Therealitiesofthisreviewwilleitherlimitthenewbusinessdesignoropenittoawiderangeofsupportpossibilities.

Inthisanalysis,twokeyquestionsmustbeforemostintheteam’sminds.First,howcanworkbemademoreefficientandcost‐reduced?Second,howcantheoperationbemademoreflexibleandreadytochangequickly?Togetherthesesupportthedeliveryofsustainedoptimizationthroughcontinuousimprovement.

Seechapter4,“ProcessAnalysis,”foramoredetaileddiscussionoftheconceptsusedinBPM‐basedprocessanalysis.

5.6 Process and Work Flow Design—Creating the “To Be” Design

Figure45.WorkflowDesignandApplicationGeneration

Atthispoint,thediscoveryactivitywillhavecreatedthe“AsIs”businessmodelsandtheywillhavebeenanalyzedforideasonhowtoimprovetheoperation.Limitationsandrequirementswillalsohavebeenformallydefinedforuseinanychange.FollowingaroadmapsimilartothatinFigure45,activitynowmovestotheredesignofthebusinessoperation.Thisredesigniswherecreativityiscritical—peoplemustthink“outsidethebox.”

Processmodelingtoolsthatbestfittheorganizationandbestsupportthedesiredgoalintheprocessdesignshouldhavebeenselectedeitherbeforeprojectstartorduringtheproject’sdiscoveryandanalysisactivities.However,amodelingtoolmayhavebeenusedinthediscoveryandanalysisactivitiesthatwillnotallowsolutiondesign,simulation,orapplicationgeneration.Inthiscase,thecompanymaychoosetolicenseafullBPMStooltosupportapplicationgenerationandfacilitatethe

BusinessOperationDiscovery—“AsIs”model

Redesignthebusiness—“ToBe”model

SimulationModelandoperationaloptimization

BPMSApplicationGeneration

Systeminterfacedevelopmentandlegacyapplicationchange

Copyright A

BPM


181

interfacingwithlegacyapplicationsanddata.Itmayalsodecidetobuildtheapplicationsupportandinterfacesinamoretraditionallanguageandusethecurrentmodelingtooltodesignthe“ToBe”businessmodel.

Duringtheanalysisstage,possiblechangestotheprocesses,subprocesses,businessfunctions,and(withinbusinessunits)activitiesinthepartoftheorganizationthatiswithinscopearelisted,weighted,andprioritized.Thisrevealsaclearpictureoftheweaknessesofthecurrentprocessorprocessesandhelpsdecidewhatwillberedesignedandinwhatorder.Oncethebusinessareastobechangedareselected,thedegreeofthechangecanbeassessedtomakeeitherincrementalorlarge‐scalesystemicchanges.Sometimes,makingfrequentsmallchangescanhaveanequallysignificanteffectonprocessperformanceaslargeradicalchanges,providedthereisaclearandacceptedvisionofthefuturestate.

Inlookingatredesigningtheoperation,theteamshouldunderstandthatthe“AsIs”modelimposesatypeofmodularityontheoperation.Eachactivityoperatesindependentlywithlinkstootheractivitiesthroughinputsandoutputs.Withintheactivity,theworkiscontrolledbybothmanagementoversightandbusinessrules.SupportisprovidedbyITintheformofapplicationsanddatadelivery,manipulation,andstorage.Allcanbeviewedasasingleintegratedmoduleor,inSOAterms,asabusinessservice.Inthisview,theoperationisaflexibleframeworkofinterconnectedservices,eachproducingsomeoutcomeordeliverablecomponentofalargerproduct.Thisisimportantbecausethismodularityallowstheteamtoidentifythepartsoftheoperationthatprovidethegreatestimmediateandthenlong‐termbenefit,andtoaddressthemseparately.

Inthisapproach,abusinessworkflowcanbeconsideredtobeamodulethatismadeofseparate,smaller,componentmodules.Thekeyisthatatanylevel,eachmoduleisacompletelyfunctioningpartofthebusiness.Itproducessomethingthatisconsumedbyanothermodule.Thesemodulesarebuildingblocksthatcanbecombinedinanyorderneededtoproduceabiggerproductorservice.Inthiswayallareinterchangeableandallarereusable.

Thisismadepossiblebythewaytheworkactivitymoduleishandled.Theintegrityofthemoduleismaintainedbyensuringthattheinputandoutputofthemoduleremainconstant—hopefullywithimprovedoutput.So,giventhattheinputandoutputrequirementsdonotchange,theteamcandowhateverisneededwithinthismodule.However,ifanoutputischanged,thechangewillrippleandtheextentofbothobviousandmorehiddenimpactsmustbeconsidered.

Note:AnychangetoanoutputatanylevelintheProcessHierarchycanhavehiddenimpacts.Itispossibletohavenoimpactonthenextactivityintheworkflow,yetseriouslyimpairanactivitytwoorthreemodulesdownstreamintheworkflow—includingactivitiesoutsidethescopeoftheproject.Itisalsoverypossibletoimproveagivenactivityorbusinessoperationandharmqualitydownstreamofthechange.Forthisreason,theteamshouldbothunderstandthedownstreammodulesandworkwithbusinessandITmanagerstomakecertainthatnoharmisdoneinachange.

Copyright A

BPM


182

Bytakingthisapproach,itispossibletoaddressthebusinessmodulesorservicesintheorderoftheirgreatestimpactonachievingthegoalsoftheproject.Byusingthebusinessmodelsforcontext,theteamcanlookatthebenefitassociatedwithanymodule.Itisthuspossiblefortheteamtofocusonthemostsignificantimprovementsfirst.Thisispossiblebecauseoftherelationshipbetweenthebusinessmodules.Asmodulesareimproved,theyarelinkedtothosetheytouchinthesamewaytheywerebeforetheywerechanged.Asfarastheimpactedmodulesareconcerned,nothinghaschanged—theystillseethesameoutputandtheystilldeliverthesameinputtothenextmodule.Inthisway,changeisisolatedtoindividualbuildingblocksandallbuildingblocksremainlinkedtoproducetheoutcome.Thisapproachmust,however,makeallowancesforthecompleteeliminationofmodulesorgroupsofmoduleswhentheybecomeautomatedorunnecessary.Inthesecasestheoutput/inputlinkswillbebrokenandwillhavetoberebuilt.

Thetechnicalapproachtosupportthedesign,construction,andimplementationofthebusinessimprovementwillneedtobeunderstoodbythebusinessdesignteam.Likewise,thebusinesstransformationapproachwillneedtobeunderstoodbythetechnologyteam.IftheprocessdesignwillbesupportedbyapplicationgenerationthroughaBPMS,theconstraintsandoptionswillbeverydifferentfromachangethatissupportedby.netorevenlegacyCOBOL‐basedapplicationsystems.BecausetheseoptionsandconstraintswillhaveanimpactonthenewbusinessandITsupportdesign,theymustbeidentifiedanddefinedatthebeginningofthedesignprocess.

ActualdesignwilltakeplaceatalllevelsoftheProcessHierarchy.Allmustbealignedinanychangeandallmustbeusedwhendownstreamactivityisconsidered.

Althoughateam’smethodologywhendesigninganewprocesswillvary,certainkeyactivitiesshouldtakeplaceduringthedesignstageofprocessmanagement.Mostcommonly,thesekeyactivitiesare

Designingthenewprocessatallappropriatelevelsofdetail(seeProcessHierarchy)

Definingactivitieswithinthenewprocessandidentifyingworkflowanddependencies

Definingbusinessoperatingscenariosandmodularizingaroundthesescenarios

Definingalldataneeds Definingrulesthatcontroltheactivities Defininghandoffsofprocessbetweenfunctionalgroups Definingcustomervaluefromthechangeandtyingittosuccess

measurement Definingdesiredmetricsinthenewprocess Defininganddesigningbusinessandperformancereporting Gap(s)inandcomparisonstoexistinganalysis Creatingbusinessandtechnicalsystemchangespecifications/requirements

Copyright A

BPM


183

Creatingthephysicaldesign ITinfrastructureanalysisanddesign Modelsimulation,testing,andacceptance Generatingorbuildingsupportingapplications Designingandbuildinginterfacestolegacyapplicationsanddata Testingallbusinessactivitieswithapplicationsupport,legacyinterfaces,and

rules Creatingandexecutinganimplementationplan.

Itisimportanttonotethatalthoughthesekeyactivitieslistedaboveappearinalogicalorder,theydonotnecessarilyoccurinthatorderandmanyoftheactivitieswilloccursimultaneously.Inaddition,thisisapartiallistthatisnotintendedtorepresentamethodortoconflictwithanyinternalcompanymethod,steps,oractivities.Rather,itismeanttoserveasalistofactivitiesthatshouldbeconsideredwithinthecontextoftheproject,thecompanymethodology,companystandards,andtheneedsoftheprojectforcontrolandmanagement.

5.6.1 Evolutive Management: Using Change to Control Evolution in the Business

Twobasicapproachescanbetakenincreatingthenewdesign.Thefirstistocreateaspecificimprovementthatisexpectedtobeimplementedinitsentiretyatonetime.Thesecondapproachistocreateafuturestatethatisoptimal,butnot(yet)practical.Maybeitwillcosttoomuch,betoodisruptive,orrequireaninfeasiblechangetotechnology,andthelistofreasonsgoesonandon.But,thebottomlineisthatthedesignisagoodeventualtarget,anditwilldefineadirectionforchange.

Inthiscase,oneorseveralinterim“phase”designsmovinginthedirectionofthe“optimal”statewillbemade.Eachofthesedesignswillsolveamajorissueordeliverasignificantimprovement.Andeachphasewillbuildonthefoundationoftheonesthathavebeenbuiltanddeployedbeforeit.Inthiswaythecompanywillevolvealongaplannedpath.

However,itshouldberealizedthatthe“eventual”end‐statetargetdesignwillneverbereached.Thereasonisthatthisevolutionapproach,called“EvolutiveManagement”(createdbyDanMorris,JoelBrandonandStephanoSommadosi,andintroducedinBrandonandMorris’sJUSTDON’TDOIT:CHALLENGINGASSUMPTIONSINBUSINESS(McGraw‐Hill,1988)continuallylookstothefuture,andtheendstatedesignisadjustedtotakeadvantageofemergingconcepts,technologyimprovements,productiontoolinginnovation,andsoon.Itisalsoadjustedtoconsidercompetitiverequirements,businessopportunities,thechangingimpactofglobalization,andmore.Giventheconstantchangingoftheend‐statetarget,thepathandthe“phases”alongthatpathconstantlyevolve.Thisallowsthecompanytoconstantlycontrolthedirectionofitschangewhileunderstandingboththedirectionandwhyithasbeenchosen.ItalsorequiresacorporatecommitmenttocontrollingthewaythebusinessevolvesandadoptingtheEvolutiveManagementApproach—orsomeversionofit.

Copyright A

BPM


184

Eachofthephasesalongthepathofthisevolutionwillbeapproachedinthesameway—asaspecificimprovementtypeofchange.

5.6.2 Designing the New Process

Companiesfunctionthroughtheirprocesses.Processesoperateasdirectedbybusinessrules.Anycompany’sabilitytooperateeffectivelyisthusadirectresultofgoodprocessesandrules.But,todayanadditionalelementmustbethrownintothismix.Thatistheabilitytoabsorbandadjusttochangequickly.Topcompetingcompanieshavecontroloverthismixandareabletoleverageallelementsinatypeoffluidconstantlychangingapproachtotheiroperations.

Manycompanieshavepartsofthismixinplaceandundercontrol.Few,however,reallyunderstandtheirend‐to‐endprocessesorhowtooptimizebothattheprocesslevel(cross‐organization)andattheworkflowlevel(withinanorganizationunit).Fewerstillhaveanabilitytosupportrapidchangeortocontrolthemajorityofchangetakingplaceinthecompany.Partofthereasonforthisisthatmid‐sizeandlargecompaniesmustformallymoveatthepacethattheirlegacyITapplicationsandtheirITenvironmentcanchange.And,mostITDepartmentsareinundatedbyrequestsforapplicationchangesandcannotkeepup.

Thatistheformalreality,butnottheoperationalreality.Onlyasmallpartofthechangeinanycompanyislarge‐scaleenoughtobenoticedorplanned.Thislevelofchangeisnotfundedanditisnottiedtoformalprojects.Itcannotbeputoffanditcannotbetracked.Thefactisthatallcompanieschangeconstantly:mostchangeoccursatalowlevelandisnotwellcontrolled.Thisis“undertheradar”change,whosepaceinbusinessoperationsfaroutstripstheabilityofITtosupportitorthecompanytomanageit,becauseitisconstantandjusthappensaspeoplefindwaystogettheirworkdone.Rulesalsochangeinthisundergroundofconstantturmoilincompanies,andmuchofthischangeisneededtointerprettheintentorapplicationoftherule.Thisisthecauseofbusiness‐operational“whitespace”work—manualworkthatisneededbecauseofautomationlimitationsandspeedofchangeinmostoperations.

Butmanyofthesetraditionalproblemslimitingcompanies’abilitytooptimizetheiroperationscannowbereducedoreliminatedbytheuseofaBusinessProcessManagementSuiteofenablingtools.Keyamongthemareprocessmodeling,rulesmanagement,applicationgeneration,dataaccesscontrol(SOA)andadvancedperformancemonitoringandmeasurementtools.ThegreatestbenefitofusingaBPMSistosupportveryrapidchange.Asdiscussedinchapter10,“BPMTechnology,”aBPMSformsanew,integratedbusiness‐andtechnology‐operatingenvironment.Themanagementofactivityissupported,andinsomewayscontrolled,bytheBPMSandtheapplicationsitgeneratesfrommodels,rules,anddatadefinitions.Achangetoanyofthemodels,rules,ordatadefinitionsregeneratestheapplications.Thisallowsveryrapidprototypinginsimulationtoensurethatthenewversionoperatesasneeded,andthensupportsthemovementoftheapplicationintoproductionbysettingasoftwareswitch.ThebottomlineisthatinaBPMS‐

Copyright A

BPM


185

supportedBPMenvironment,changecannowkeeppacewithneed—atanylevelintheprocesshierarchy(seeFigure42).

Asaresultoftheavailabilityofthesetools,therearenowmanywaystoapproachdesigningthenewprocess.Theserangefromusingsimplewhiteboards(orbrownpaper)inamanualdesign,tosimpletool‐supportedmodeling,throughsophisticatedsoftwaremodelingtoolsthatallowthestorageandretrievalofprocessinformation.Theuseofthesetools,whethertheyaresophisticatedorsimple,manually‐createdpapermodels,issupportedbyavarietyofinformation‐gatheringactivities(brain‐storming,storycreation,etc.)thatfacilitatethecreationofthebusinessmodel.

Acompletediscussionofthetools,activities,andmethodologiesusedtomodelprocessesisbeyondthescopeoftheCBOK®.Allofthetoolsormethodsusedhavetheirvariousstrengthsandweaknesses.Thecorrecttool,methodology,andactivitytodefinetheprocessdependsontheprojectgoal,thecultureoftheorganization,thepossibleneedtogenerateapplications,andthecurrenttechnologyinfrastructure.

Theimportanceofprocess‐modelingsupportthroughanautomatedtool,however,canbefoundinthedisciplineitenforcesontheprojectteamandintheorganizationofinformation.Today,vastamountsofinformationwillbecollectedinanyimprovementproject.Organizingthisinformationisachallenge.Forcingtheteamstocollecttherightinformationhasbeenaproblem.Rememberingtheinformationandthenusingithasbeenanevenbiggerproblem.BPMmodelingtoolsusuallyhaveasoliddatabaseunderlyingthemodelerandofferbothmodel/informationorganizationandadvancedinformationaccess.

5.6.2.1 “To Be” Process Design

Process‐levelchangeshouldbeconsideredasthefirststepinchangedesign.Willanyofthehigh‐levelprocesscomponents(subprocesses)beeliminatedornewonesadded?Thislevelofchangeiscriticalineitheraddingordeletinglargeareasofwork.

ThesameistrueateachlevelintheProcessHierarchy(Figure42)becauseanychangeatahigherlevelaffectsallthelevelsbelowitbydefiningthetypeofchangeandthustheimpact.Butallchangewilleventuallybedesignedandimplementedatthebusinessunitworkflowlevelandthroughthetasksscenarioswithintheworkflows.ItisthusimportantthatalllevelsintheProcessHierarchybeconsideredinanynewdesign.

Theactualprocessredesignwillbebasedontheideathatthestatusquoshouldbechallengedandthatprocessesshouldbeimproved.Asnoted,thisactuallyappliestoalllevelsintheprocesshierarchy.Inthisapproach,nopartoftheoperationshouldbeabovequestion.Everythingmustbelookedatandreviewedforopportunitiestoreduceeffort,improvequality,reducecostandeliminateproblems.Problemsidentifiedduringthediscoveryactivitywillnowbeusedtofocusactivityontothework,decisions,handoff,andflowchangesthatcontributetotheproblem—andtoeliminateproblemsbydesigningtherootcausesoutofexistence.Issueswith

Copyright A

BPM


186

quality,staffinglevels,training,andmoremustalsobefactoredintothenewdesignandremovedormitigated,butthefirstconsiderationshouldbeproblemelimination.Thisalonewillprovidesignificantbenefits,butitisonlythestartofaredesign.

Asthenewdesignisconsidered,itiscriticaltoinvolveasmanypeopleaspossiblefromthedifferentfunctionsthatinteractwiththeprocess,thusutilizingthebreadthofexperienceandknowledgeofthoseclosesttotheprocess.Thisensuresthattheprocesstrulyreflectswhattheorganizationcanaccomplish.Italsodrivesoutfearandengagesthestafftopromoteacceptanceofthechange.

Startingwiththe“AsIs”design(seeFigure47),theteamshouldaskatleastthefollowingquestionsofeveryactivity.ThesequestionssupportthebasicsetofanalysisanddesignquestionsofWho,What,When,Why,WhereandHow.Thebasicrequirementherehowever,istolookatthesequestionsfromtheperspectiveofhoweachoftheanswerstothesequestionscanbeusedtoimprovethebusinessoperationandthevalueitprovidestothecustomer.

Whatisthepurposeofthisprocess,subprocess,workfloworactivity? Isitredundantorsimilartoanotheronethatisbeingperformed? Whataretheproblems,qualityandgovernanceissues,andwhyarethey

occurring? Whyisthisstepnecessary? Whatisitspurpose?

Figure46.WhereProcessDesignFitsIn

Copyright A

BPM


187

Whereshoulditbedone? Whenshoulditbedone? Whoisbestqualifiedtodoit? Isitproperlysupportedbyautomation? Whatareitsmajorproblems? Howcantheproblemsbeeliminated? Howcantheoperationbemadeaseffectiveaspossible(onlydowhatneeds

tobedone)? Howcantheoperationbemadeasefficientaspossible(eliminateunneeded

activity)? Howcannotedwasteberemoved? Aretherestandardsthatmustbehit? Howcanwemonitortheactivityandensurethatperformancetargetsare

hit? Whatarethefactorslimitingchange(s)totheprocess,subprocess,workflow,

activity,orscenario?

Note:Thisisapartiallistofthequestionsthatneedtobeasked.Thesequestionsserveonlyasanexampleofthetypesofthingsthattheteammustconsiderindesigninganewoperationalchange.

Intheapproachtakentoredesignthebusiness,theteammustbeopentocreativeideasandtheymustbevisionaryintheirthinkingabouthowthebusinesscouldoperate.Everyactivitythatisperformedmusthaveaspecificbusinessreasonanditmustcontributedirectlytothedeliveryofaservice,outcome,orproduct.Ifitdoesnot,itsvaluemustbecriticallyquestionedanditshouldbeeitherchangedoreliminated.Activitiesmustprovidemeasureableordefinablevaluetoremainasapartoftheoperation.However,indefiningvalue,theteamshouldnotlimitthemselvestolookingatdirectcustomervalue.Financialvaluetothecompany,staffretention,improvedabilitytocompeteandavarietyofothervaluecategoriesarealsovalidinthisquestioningandinthenewdesign.Valuecategories,however,shouldbedefinable(anddefined),validated,rated,andapproved.Allworkshouldthenfitintooneofthesevaluecategories.

Onceworkhasbeendeterminedtoprovidevalue,itwillbeconsideredtocontributetotheeffectiveoperationofthebusiness—doingtherightthings.Thisshouldeliminateallworkthatisnolongernecessary,butitwillnotaddressefficiencyinanyway.

Thisinitialadjustmentisneededtoprovideanewfoundationmodelofthebusiness.IfaBPMStoolisbeingused,thiswillnowstartanewdesignmodel.

ThisactivityevaluationanddeletionshouldbedoneusingtheBusinessModelingorBPMStoolthatthe“AsIs”modelisin.Here,theteamshouldstartbymakingacopyoftheoriginal“AsIs”modelandthendeletingallunneededwork.Ofcoursethiseliminationofunnecessaryworkwillcauseholesinthe“AsIs”modelofthework,butthisrevisioncannowbeconsideredthestartingpointforthenewmodeldesign.Severalcopiesofthisnew“AsIs”modelshouldbemadeandassignedtosub‐teams.

Copyright A

BPM


188

Eachteamandsub‐teamwillthushavetheirownuniqueversion,andcanthenbeaskedtocreativelylookforandmodelactivity,andthusworkflow‐levelimprovements.Thiswillallowthemtothinkoutsidethebox.Thegoalhereisproblemeliminationandoperationalefficiency.Throughtrialanderror,thenewdesignscanbecreatedandtested.Anewcompositemodelcanbecreatedbyidentifyingandusingthebest‐of‐breedcomponentsofthevariousteamversions.Thismodelwillthenbeoptimizedbyrunningitthroughthesimulationtoolandcomparingitagainstthebaselineor“AsIs”model.

Oncethismodeliscreated,theimprovementmuststillbeviewedfromtheperspectiveofupstreamworkanddownstreamworkinthebusinessunit’sworkflow.Itmustalsobetestedtodetermineitsimpactontheprocessandondownstreamworkthatisoutsidethebusinessunit.Whentheimprovementcanbedeterminedtocausenoharm,andmaybeevenimproveotheroperationalcomponents,thechangewillbereadytobetakentoadetaillevelneededforBPMSapplicationgeneration.IncaseswhereaBPMSisnotused,theteamwillnowneedtodefinethelowest‐leveltasksandthencreatebothbusinesschangespecificationsandITapplicationandlegacyapplicationsinterfacespecs.Herethedesignand

Figure47.DesigningaNewProcess

Copyright A

BPM


189

responsibilityforthecompletionofthesupportingapplicationswillmovetotheITdepartment.Ifthisnon‐BPMSapproachisused,theprojectwillneedtocoordinateresourceneedswiththeITdepartmentandhaveallworkpre‐approvedandproperlyprioritizedtosavetime.

5.6.2.2 Defining Activities within the New Process

Asnotedabove,itisnecessarytolookatabusinessdesignfrommultiplelevelsofdetailtoensurenoharmisdonetodownstreamworkorworkthatishandedbackandforthwithexternalgroups.

Theactivity‐level“ToBe”processmodelscreatedearlierandtheirlevelsofrelateddetailthroughsubprocess,businessfunction,activityinanorganizationunit,workflow,andscenarios,willbeusedtosupportthismulti‐layeredviewofthebusiness.

Atthispoint,theactivitylevel“ToBe”businessmodelwillreflecttheeliminationofnon‐valueaddedwork.Theanalysisofthe“AsIs”modelsandinformationwillalsohaveproducedasetoffunctionalandnon‐functionalbusinessrequirements,alistofbusinessrulesthatmustbeconsidered(andwherepossiblereusedinthenewdesign),alistofdatarequirements,andalistofcurrentandneededITapplicationssupportfunctions.Thenewdesignteamwillalsohavealistofbusinessproblems,changeconstraints,performanceneeds,operationalstandardsandmorefromthe“AsIs”analysis.Asaresult,thedesignteamwillhaveanunderstandingofhowthebusinessreallyworks,whatthepeopleperformingtheactivitymustreallydo,andwhatittakestodoit.

5.6.2.3 Designing Task and Scenario‐Level Change

Clearly,alllevelsoftheProcessHierarchymustfulfillallrequirementsidentifiedintheanalysisofthe”AsIs”modelsandinformationcollectedduringthediscoveryactivity.Butthisisonlythestartofthenewdesign.TheunneededworkatalllevelsintheProcessHierarchywillhavebeeneliminatedfromthedesignthattheteamwilluseasastartingpointinthetask‐andscenario‐leveldesign.TheproblemsshownintheProblemMatrixandtheopportunitiesintheOpportunityMatrixmustnowbealignedtothetasks/activities/processesattheappropriatelevelsintheProcessHierarchy.Thisalignmentwilleventuallyaffectthelowestlevelofwork,whereoperationalworkandautomationdesignwilltakeplace.

Thisdesignwillthusinvolvetheworkflowsinbusinessunitsandthescenariosandtasksthatcomprisethem.Allproblemsmustbeanalyzedintermsoftherootcausesandallunderlyingfactorsaddressedandeliminated.At“BreakPoint”(theplacesinworkflowswhereerrorsandproblemsarenoticed)theteammustlookathowtheproblemsaredetected(whatislookedforinaninitialidentification)anddefinethecharacteristicsthatdetermineanerrororproblem.Thesecharacteristicsarethenusedtoanalyzetheupstreamactivityattheneededlevelofdetailtodeterminehowtheproblemsstartandthenbuild.Withthisunderstanding,manyproblemscanbedesignedoutofexistenceandperformancemeasurementputinplacetomakecertainthatanyremainingproblemsaredetectedearlyandmitigated.However,insomecaseswherethecauseisoutsidethescopeoftheproject,itwillbenecessary

Copyright A

BPM


190

tonotethecauseandthendesignawaytomitigatetheproblem—dealwithit,encapsulateit,improvethequality,etc.,assoonastheinformation,document,product(etc.)crossestheboundaryintotheareaofthebusinessthatisinscope.Thiswillrequireworkandthuscost,butitwillbefarlessexpensivetocorrecttheproblemattheboundarywhereitcomesintotheorganizationthanlater,attheendoftheworkflow.

BusinessimprovementopportunitiesidentifiedintheOpportunityMatrixshouldalsobeaddressedinthenewdesignatthispoint.Allchangesneededtorealizetheopportunityshouldbedefinedandthedesignshouldbemodifiedtodelivertheopportunities.Here,however,performancemeasurementshouldbebuiltintotheworkflowtomeasurebenefitandreportactualbenefitagainstexpectedbenefit.

Thenewdesignshouldnothaveanynon‐essentialwork,theproblemsintheoperationshouldhavebeendesignedoutormitigated,thebusinessimprovementopportunitiesshouldhavebeenusedintheredesign,andaspecificimprovementorevolutiveapproachtothechangeshouldhavebeenselected.

Theteamshouldnowdefinethecharacteristicsthatwouldmakethenewdesignoptimalandpresentthemtoparticipatingmanagersforapproval.Thesecharacteristicswillbethefoundationforperformancemeasurementandthebasisfordeterminingprojectsuccess.Theyarethereforeimportantandtheteamshouldbecarefulnottooverpromiseonthischaracteristiclist.Thislistshouldnowbethemainlistofrequirements.

Thislistofsuccessrequirementsshouldnowbeusedasachecklist,andonebyone,theteamshouldmakecertainthatallrequirementsaremetinthenewdesign.Atthistimeitisalsopossibletoidentifygroupsofactivitiesthatwillalwaysbeexecutedingivenevents,atgiventimes,orasaresultofsomevalueinadecision.Thesecanbegroupedtoformscenarios.Ascenarioisinitiatedandtheneachdecisionorgroupingofdatathatiscollecteddeterminesthenextsetofactivity.Thatactivity,inturndeterminesthenextgroupofactivityasthedecisionsorvaluesdeterminethepaththatistakenthroughthescenario’sgroupsofactivity.Ateachbranch,however,theactivityforthenextgroupofworkwillalwaysbethesameandtheresultofadecisionorvaluewillalwayshaveafinitelistofalternativesthatarealwayschosenfrominthesameway.

Bylookingatthisworkasrelatedclumpsofactivitiesthatprovideagivendecisionorvalue,theworkcanberedesignedtodirectactivitythroughstandardquestionsandanswer‐selectionoptions.Thiscanbeusedtoembeddecisionlogicandremoveunneededlayersofhumandecision‐making,unneededlayersofauthorization,etc.Automatedsupportcanalsobeviewedintermsofitsoverallsupportforthescenarioanditssupportforeachworkgroupwithintheoverallscenario.Allrulesandlogiccanalsobeeasilycheckedandmeasurementpointscanbeclearlyreviewed.

But,thechangesthathavebeenmadeuptoandincludingthisstageoftheredesignstillmaynotmakethedesignefficient.Forefficiency,allbusinessrulesmustbeevaluatedandnormalized—becauseinmanycompanies,theevolutionofformal

Copyright A

BPM


191

andinformalruleshasresultedinredundancies,conflicts,definitionproblems,processinginconsistenciesandqualityproblems.Allrulesmustthereforebereviewedandproventobebothneededandeffective.

Thedesignmightstillbedisjointed,sotheteamwillneedtolookattheflowandthewayitbranches.Ifpossibletheflowshouldbesimplified.Inthispartofthedesignapproach,theteamshouldalsohighlightallmanualworkandeliminateasmuchofitaspossible.IfaBPMSisbeingused,the“whitespace”activitymaybereplacedwithBPMS‐generatedapplications.Ifatraditionaldrawtoolisbeingusedtosupportthedesign,itwillbenecessarytoworkwithITtodeterminewhatmightrealisticallybeautomated,andwhenthatcouldbecompleted.

Itshouldbenoted,however,thatshiftingworktoanotherorganizationoroutsourcingitisnotthesameaseliminatingit.Thecostsoftheworkmaybeshifted,buttheyarenoteliminatedandthecompanymuststilldealwiththem.

Astheteammovesthroughthis“ToBe”designprocess,itissuggestedthatmultipleconcurrentversionsofthenewdesignbeusedastestingplatformsforeverythingfromwildideasonfundamentalchangetomoremodestfocusedimprovement.Resultsoftheseexperimentsshouldbecloselyreviewedandthebestimprovementsaddedtothenewbusinessmodel.

Atthispoint,thechangesshouldprovideastreamlinedbusinessoperation.IfaBPMSisused,theteamshouldrunthechangedworkflowthroughthetool’ssimulationcapabilitytotestforrealoperatingimprovement—runthe“AsIs”versionandthenthenewversionandcomparetheresults.Thiswillshowprobablebenefit.Whereinefficienciesremain,theteammaywanttoperformaseconddesignandoptimizetheoverallworkflow.

Thenextthingfortheteamtoevaluateistheneedtomanagetheworkflowandallactivity.Thiswillincludeidentifyingwhereworklists,abilitytoreassignwork,andplacestoembedrulesdealingwithtiming,volume,andothercompanystandardsexist.

Thisisthepointwheremanagementcontrolisimproved.IfaBPMSisbeingused,therequirementsforautomatedworklisting,workassignment,workshifting(etc.)andreportingcanbebuiltintothenewmodelsandusedtogeneratetheBPMSapplicationsneededtoimprove,control,andmonitorperformance.Seechapter10,“BPMSTechnology,”formoredetails.IfaBPMSisNOTbeingused,theteamwillneedtomeetwiththeITrepresentativetodeterminewhatcanbedoneinthisarea.Thedesignwillneedtoreflectthistechnologyreality.

Asthenewbusinessdesignisinthelaterstagesofitsevolutiontowardanimplementablebusiness‐operatingsolution,itwillbenecessarytodesignallsystemrequirementsandallscreensthatwillbeused.IfaBPMSisused,thisdesignisfairlystraightforwardasitisembeddedinthemodelsofthenewdesign.IfthisdesignwillbesupportedbymoretraditionalITservices,thedesignmayinitiallybefairlyhighlevel,butitwillneedtoaligndirectlytothebusinessoperatingdesign.Alldocumentsthatwillbeusedandtheirflowmustalsobemappedtothebusinessactivityandaccountedforinthenewdesign.Thismayrequiretheinclusionof

Copyright A

BPM


192

documentmanagementtechnologyinthenewdesignandintherequirementsforinterfacing.

Alldataoneveryscreenmustbeidentifiedand,workingwiththeITdataanalysts,defined.Allsourcesforthisdata,includingnewdocuments,customercalls,legacyapplications,collaborationpartners,etc.,mustbeidentifiedandalignedtothedatacapturepoints.Allquality‐relateddataeditsmustalsobedefinedandalignedtothedatacaptureandusepoints.Thissetsthefoundationfortheidentificationoflegacyapplicationuse,changerequirements,andconsolidation.Italsosetstherequirementfordatainterfacingandnewdatatransformation.Theresultofthispartofthedesignisasetofdatauseandinterfacerequirements.

Thedesignshouldnowbecomplete Allnon‐value‐addedworkwillhavebeeneliminated Allproblemswillhavebeenaddressed Allbusinessimprovementopportunitieswillhavebeenaddressed Ruleswillhavebeenjustifiedandnormalized Whitespace(manual,under‐automatedwork)activitywillhavebeen

eliminated Businessscenarioswillhavebeenstreamlined Allchangeswillhavebeenreviewedforimpactatalllevelsintheprocess

hierarchy Alldatause,transformations,andsourceswillhavebeenidentified,and

interfaceswithlegacyapplicationswillhavebeendefined Allnewautomationwillhavebeendefinedanddesigned Thedesignwillhavebeencomparedagainsttheoriginal“AsIs”designand

evaluatedforimprovement Theprojectandthenewbusinessdesigngovernancewillhavebeendesigned Managementperformance,warning,andotherreportingwillhavebeen

designed.

Aswithanydesignorrequirementdefinition,thelevelofdetailwillberelatedtothedifficultyofthechangeandthescopeoftheoperationinvolvedinthechange.ThislevelshouldbedeterminedbythemethodandstandardsthatarefollowedandbytheneedtosupporteitheraBPMS‐applicationgenerationoratraditionalITapplication’sbusinessandtechnicalspecification.

Whateverlevelofdetailisneeded,willnowhavebeenreachedinthedesign.Itwillnowbepossibletomakeimmediateimprovementsandbegintobuildandimplementthechangesidentifiedinthefirstofthephases(assuminganEvolutiveManagementapproach)oftheoperation’sevolutiontowardoptimizationandrapidchange.

5.6.2.4 Business Rules—an Ongoing Quest for Improvement

Dataisthelife‐bloodofanybusinessoperation.Ifflowsthroughitandkeepseverythingalive.BusinessRules,inasimilaranalogy,arethe“brainsoftheoutfit.”Rulesdefinewhatwillbedone,whenitwillbedone,whereitwillbedone,whyitwillbedone,howitwillbedone,andhowitwillallbemanagedorgoverned.The

Copyright A

BPM


193

needforqualityintherulesthatrunthebusinesscannotbeoverstated.Iftherulesareineffective,thebusinessoperationwillbeineffectiveandqualitywillsufferwhilecostsincrease.

Toaddtothisproblem,mostoftherulesthatarewritteninmanycompaniesareoutofdateandoftenconflictwithoneanother.Rulesareoftenaddedthroughmemosandemail,whichpeoplemayormaynotkeep,or(atbest)beaddedtothegrowingstackofpaperinthefrontorbackofthepolicymanual.Fewbusinessoperationshavepaidcloseattentiontothisproblem,andtheircurrentrulesmaynotsupportpolicyorevenlegislation(thelaw).

Forthisreason,anyBPMprojectmustbeconcernedaboutfinding,listing,defining,andnormalizingbusinessrules.Theteammustalsoconcernitselfwithhowtherulesareusedand,ifaBPMSorseparaterules‐enginewillbeusedintheproject,howtherulesare“coded”intothetool.

Whendefiningbusinessrules,thetendencyinmanyorganizationsistomakethemcomplex.Partofthistendencyisadesiretoreducethenumberofrules.Butthemaincauseisthatmanypeopletendtoputentiredecisiontreesinsinglerulesinsteadofbreakingtherulesintosingledecisionsandthenlinkingtherulesinsets.Asidefrommakingtheruleshardertotestanduse,thiscomplexityinasetofbusinessrulescreatescomplexityintheprocess.Themorecomplextheprocessis,themoreopportunitiesfortheprocesstofail.So,itisimportanttocreatecompanyrules‐definitionandcodingstandardsthatkeeprulesassimpleaspossible.

Eachrulemustbeseparatelytested—bothinwrittenformandthen,oncecoded,intoarulesengine.Therulesmustthenbetestedingroupsastheyareused.TheresultsshouldbereviewedbytheLegalDepartmentorFinancetoensurethattheysupportlegalandfinancialrequirements.Therulesshouldalsobetestedforefficientexecution:ifnotproperlycoded,therulecancausetheapplicationsystemsandthusthebusinesstoslowdown.

Itisthusimportantthattheteamfindallrules,ensuretheirapplicabilityandquality,andverifythattheyarecodedformaximumexecutionefficiencyandeffectiveness.

Becauseruleschangeconstantlyandare(arguably)morevolatilethananyothercomponentofthebusinessoperation,itisimportantthatallrulesbereviewedandconfirmedforapplicabilityatleastsemi‐annually.Thereviewshoulduncoverchanges,newrules,andnewopportunitiestoeliminateanyrule‐related“whitespace”activitythathasbeencreated.Whilethisrepresentsongoingwork,itisavitalpartofanyattempttosustainanoptimalbusinessoperation.

5.7 Change Management

Agreatmanygoodprojectsfailbecausetheteamsdonotpayenoughattentiontomanagingthechangeanditsacceptabilitytothebusinessuser.Thesimplefactisthatthepeoplewhoneedtoperformanewbusinesstask,useanewapplicationsystem,measureperformanceandmore,willresistthechangeiftheyhavenotaccepteditoriftheyfeeluncomfortableinperformingit.

Copyright A

BPM


194

Agreatmanybookshavebeenwrittenoncorporatecultureandchangecontrol.Somecompanieshaverespondedtothisneedtowinstaffacceptanceofchangebyformingformalchange‐managementgroupsandstandardsfordealingwithchangeinbothbusinessandITprojects.Insomecompanies,thisdesiretocontrolthereactiontochangemakescertainthatteamsincludethehumanperspectiveandwaysofcommunicatingintent,design,andreasontothebusinessstaff.

Changeisviewedinoneoftwoways.Youareeitherdoingsomethingtosomeone,oryouaredoingsomethingwithhimorher.Thesecondoftheseviewsisobviouslytheonetheteamneedstobuild.Theold‐technologyapproachofadedicatedbusinesssubject‐matterexpert(SME)whodecideswhatwillbedoneandhowthingswillworkhasproventobeinadequateinBPM.Thechangesaresimplytooinvasivewhenanewwayofdoingbusinessisthegoal.AbusinessSMEwasfinewhendeliveringatool(anapplicationsystem)thatwaslaidontopofthebusinessoperation,buttheintegratedbusinessactivity/tooldesignanduseofBPMhascreatedadifferentlevelofinvolvementfromboththebusiness‐andIT‐techniciansidesoftheoperation.

Thebusinessstaffwilleitherembracethechangeorfindwaystoproveitisafailure.Ifthemajorityfeelthreatenedbythechange,theywillfindwaystomakeitfail.Thatisreality.ThepurposeofthissectioninthechapteristomakereadersawarethatinBPM,anewlevelofchange‐controlisneeded,andanybusinessdesignshouldincludetechniquesthatreassurebusinessstaffandengagethemintheimprovement.

5.8 IT Infrastructure Analysis and Design

NewbusinessoperatingdesignsmaycausechangesinbothITsupportneedsandinthewaythebusinessoperationislocatedinthecompany’sofficeandplantspace.Thismay,inturn,haveanimpactontheITinfrastructureandtheneedforcommunicationsupport.

Inaddition,thedata‐andfunctional‐supportneedsofthenewbusinessdesignwilllikelycauseinterfaceneedswithlegacyapplicationsandrequirementsfordatamovementthatmayhaveaprofoundimpactonITstrategyandinfrastructure—includingdocumentuseandretention,anddatastorageanddelivery.

Ifalonger‐termbusinesschangedesignisused,followinganapproachlikeEvolutiveManagement,theITinfrastructurewillneedtobeanalyzedandalignedtothephasesintheevolvingbusinessoperation.ThiswillallowthebusinesschangetobeincludedintheITinfrastructureandinotherplansandbudgets.ItwillalsoallowtheEnterpriseArchitectsintheITgrouptolookatemergingtechnologiesandapplicationsystemsandleveragetheirunderstandingofthistechnologytocontinuallylookforthebestsolutionatagivenpointintime,asdefinedinthebusinessevolutionplan.

SomeoftheissuestheITorganizationwillneedtolookatare:

Whatsoftwareorsystemsbestmatchtheneedsoftheprocess?

Copyright A

BPM


195

Aretherelimitationsinthecurrentinfrastructurethatlimitthedesign? Canthedesignbeimplementedquickly? Howwillatechnologychangeimpacttheorganization? Canastagedapproachbeemployed? Whatwillthenewimplementationcost(includingtraining,technology,etc.)? Aretherevendorsthatcanassistintheimplementation?

TheseandrelatedquestionsshouldbelookedatcollaborativelybetweentheBPMArchitects,EnterpriseArchitects,andBusinessArchitectstoensureunderstandingofbusinessandITalignmentandrequirements.ThiswillalsoallowtheBPMArchitecttounderstandlimitationsfacedbytheITgroupandthecompany’sITinfrastructureasitevolves.

5.9 Simulation Modeling

Asnotedaboveinthediscussionondesign,thenewdesignshouldbetestedbeforechangesarebuiltandITapplicationsaregenerated.Thetestwilllookatthelikelyresultofthechangesproposedinthedesign.ThistestingisasimulationofthenewbusinessoperationanditsITsupport,eitheronpaperorusingthesimulationcapabilitiesofmanyBPMStools.

Inthissimulation,the“AsIs”workflowwillbeusedtodefinethebaseline—thecurrentactivitiesandtheirrelationshipstooneanother.Alldecisionsintheworkflowwillbeusedtosimulatepossibleworkflowbranches.Theprobabilityofeachdecisionoutcomewillneedtobeestimatedasapercent.Thiswilldefinehowmanytimesagivenexitwillbeused—i.e.10%ofthetimethedecisionisyes,50%itwillbeno,and40%ofthetimeadditionalinformationwillbeneeded.Thesimulationwillalsoneedtounderstandvolumes,timings,andhowmanyofagiventransactionapersoncanprocessinagivenperiodoftime.Thiswillnowallowtheteamtotestforbreakpoints,bottlenecks,andmanagementneeds(suchasworkshiftingandrulechanges).SimulatingthecurrentoperationintheBPMSallowstheteamtomodifytheinformationuntilthesimulationreflectstheactualoperation.

Thenewprocessdesignwillnowbecomparedtotheexistingstateinagapanalysisthatshowstheimpactofthechanges.Thisanalysisprovidesimportantinformationthatcanallowtheteamtodemonstratethesavingsthatcanbegeneratedbythenewprocess,oncetheprocessisimplemented.Thishelpsconfirmtheimprovementestimatesinthebusinesscaseforthenewdesign,orprovidesanopportunitytoadjustestimatesandresetexpectations.

Oncethe“AsIs”modelandinformationprovidethebaselineforcomparison,theteamcantestanynumberofpossibledesignoptions.Thistestingisrisk‐free,sinceitisinasimulatedoperation.Bycomparingtheoperatingandcostresultsofthesesimulations,theteamcanlookforthebestsolutionsandprovideanestimateofthebenefit.Thisabilitytotestdesignsandthenquicklydeploythebestsimulationsupportsbothrapiditerationandfastimplementationofthechange.Thisiscriticalinreachingoptimizationandsustainingthatlevelofperformance.

Copyright A

BPM


196

5.10 Conclusions

Theprocessdesignstageinaprocessimprovementinitiativeattemptstodefinethenewprocessstateandoutlinesthestepsnecessarytoachievethatstate.Throughoutthischapterthekeyactivities,criticalsuccessfactors,andsuggestedpracticesforachievingasuccessfulprocessdesignhavebeendiscussed.Thenextstep,addressedinthefollowingchapter,istoimplementthenewdesign.

5.11 Key Concepts

Processdesignisthecreationofanewprocessthatalignsthebusinessaroundthebusinessstrategy.

Processdesigninvolvestheexecutiveleadership,processowners,andstakeholdersinthecreationofthenewprocess.

Theprocessdesignteamshouldincludesubjectmatterexperts,stakeholders,participants,andcustomers.

Whiledesigninganewprocess,considerationshouldbegiventothefollowingbestpractices:

Designaroundvalue‐addedactivities. Performworkwhereitmakesthemostsense. Createasinglepointofcontactforthecustomer. Combineprocessesaroundclusters. Reducehandoffs. Reducebatchsizes. Putaccesstoinformationwhereitisneededthemost. Captureinformationonceandshareitwitheveryone. Redesigntheprocessbeforeconsideringautomation. Designfordesiredperformancemetrics. Standardizeprocesses. Considerco‐locatednetworkedteamsandoutsourcing. Theactivitiesassociatedwithprocessdesignincludethefollowing: Designtheprocesswithmodelingandothertools. Definetheactivitiesofthenewprocess. Definetherulesofthenewprocess. Definethehandoffsbetweenactivities. Definethemetrics. Performcomparisonsandbenchmarking. Performsimulationandtesting. Createtheimplementationplan.

Criticalsuccessfactorsincludeensuringtheinvolvementofexecutiveleadership,processowners,andcross‐functionalteams.

Copyright A

BPM

P International

Chapter 6

Process Performance Management

Copyright A

BPM

P InternationalChapter6.ProcessPerformanceManagement

198

Foreword by David McCoy, Managing Vice President and Gartner Fellow Emeritus

©Gartner,Inc.2012.

Inthe2000to2001timeframe,RoySchulteandIwereleadingateamintroducinghisconceptofBusinessActivityMonitoring(BAM)totheworld,andwewerefindingresoundinginterestintheideaofmonitoring“businessactivities”inrealtimethroughtheuseofeventcapture,filtering,andanalytics.IrememberoneparticularBAMpresentationwedid—thefirstfull‐blownBAMpresentationeverdeliveredanywhere.Itwasajointeffortatoneofourconferencesandtheaudiencewasheavilytechnology‐focused,tothepointthatseveralattendeescamefromthereal‐timeautomationworldofmanufacturing.Wewereprovingthepointthatwhatworksontheshopfloorcouldalsoworkinthebusiness.Now,wellover10yearslater,wefindBAMtobeacommonplacetopicamongBPMexperts,andthenotionofreal‐timeprocessperformancemonitoringishardlyatrickysaletotheorganization.ButdespitetheestablishedfootholdthatBAMhastaken,theoverallconceptofprocessperformancemanagementisstillamysterytomany,andtheexecutionofthisactivityinmostcompaniesleavesalottobedesired.

Toputitbluntly,it’seasytomeasureandmanageprocessperformance—intheabstract;butwhenyouactuallyhavetodelivertangiblevaluefromtheeffort,weoftenfallshort.Thisshortfallissometimesrelatedtotheunderlyingtechnology:poorlyconnectedsystems,outdatedinfrastructure,rigidapplications,andweakevent‐processingcapabilitiesallleadtofailure.ButIthinkthebiggestchallengeisathree‐prongedoneofscope,value,andperspective.Inotherwords,whenwelookatprocessperformancemanagement,weoftenfindthatwecanmeasureandmanageanything,andmostoften,that’sexactlywhatwedo:wemeasureanythingthatmoves,overlookingthemoredifficultopportunitiesthatliebeneaththesurfaceofourprocessworld.

AProblemofScope:ConsideranexamplethatIwroteaboutinmyGartnerblogathttp://blogs.gartner.com/dave_mccoy/2010/06/07/75‐miles‐per‐gallon‐down‐blood‐mountain‐the‐fallacy‐of‐metrics/.ItravelupanddownBloodMountaininGeorgiamanytimesayear.AsIascendthemountain,mygasmileageplummets;butasIdescend—basicallyallowingthesteepgradeandgravityto“dotheirthing”—myinstantaneousgasmileageshootsthroughtheroof.Onarecenttrip,Iwasabletopegthemiles‐per‐gallonreadingat99,effectivelyhittinglimitstheprogrammersneverconsideredrealisticforacarthataverages25mpg.Iusethistoillustrateaclassicfailureinprocessperformancemanagement:limitedfocus.

IfIweretodividetheprocessofdrivingBloodMountainintotwosub‐processes,AscendandDescend,thenalimitedfocuswouldsay,“Justdothedownhillpart!Theuphillpartistooexpensive.”Well,that’spatentlyludicrous,butwhathappenswhenwelookatourbusinessprocesseswithalimitedfocus?Wemaketheexactsamemistakes.Wedon’tseetheend‐to‐endprocessastheunitofmeasure;instead,weseethepartsoftheprocessasatomicandisolated,worthyofindividualmetrics,

Copyright A

BPM


199

measurement,andperformanceassessment.Whilethere’snothingwrongwithanalyzingprocesseswithfocusedmeasures,ifthemeasuresarenotpartofaholisticframework—anend‐to‐endview—thenyouwillmakesuboptimaldecisions—decisionsjustasinsipidastheideathatyoucantraverseBloodMountainbyonlygoingdownhill.Thisisthemistakeofscope;it’sonethatcanbeovercomewithaproperunderstandingoftheend‐to‐endperspective,theprocessmajorasopposedtotheprocessatomic.

AProblemofValue:Let’sassumewearelookingattheend‐to‐endprocessandwe’renotatomizingtheholistictounreasonablelevelsofscrutiny.Well,we’restillnotoutofthewoodsonprocessperformancemanagementbecausewecanmakemistakesinassessingtherealvalueoftheend‐to‐endprocess.Dependingonthemetricswealigntotheprocess,wemightbeperformingwellonanend‐to‐endbasis—accordingtoourmetrics—buttotallyblowingthemission.

Misguidedemployeeproductivitymeasurementsfallintothiseffort.Whatifyourend‐to‐endprocessiscalled“desire‐to‐desk”andit’sahiringprocessthattakesanapplicantfromjobopeningtothatfirstdayatwork.Is“cycletime”areasonablemeasure?Itisreasonabletowanttomeasurethetimeittakestorecruit.Thereisanassumptionthatfasterrecruitingisanasset,somuchsothatit’scalled“agility.”Butifthat’sthemeasure,thenhowistheprocessperformancemanaged?Well,it’smanagedbyaclockandcalendarmentality.Butintheend,thepropervaluepropositionforourtheoreticaldesire‐to‐deskprocessis“qualityhiresinareasonabletime.”Doestheclockandcalendarmentalityworryaboutquality?Perhapsitdoes;butmoreoften,it’sadiscussionofspeedsandfeedsandnotoneofsuchnebulousconceptsasquality.We’vefixedthescopeproblemhere;wearenowlookingattheend‐to‐endprocessfrominitialapplicationtoofficeassignment.Buteventhoughwearenotatomizingtheprocess,weareatomizingthevaluebyselectingonlyasurrogateforwhatthetruevalueshouldbe.

Thisisthemistakeofvalue;toovercomethis,youmustfullyexaminetheprocessinlightofitspropercontributionandextractthemostsalientoutcomesthattheprocessisseekingtodeliver.Intheend,adesire‐to‐deskprocessshouldnotbeaboutagility;itshouldbeaboutpristineresourcingofyourmostcriticalresources:youremployees.However,whenfirmstreatthehiringprocessasaspeeddatingservice,yougetwhatyoumeasure.Toabachelor,perhapsaspeedydateisdesirable;buttoahiringorganization,therealvaluecomesfromamorecomprehensiveunderstandingofthetruevalueoftheprocess.Foronlythencanyoumanagetheperformanceinlightofaproperoutcome.

AProblemofPerspective:Perhapsyou’reconvincedbymyideassofar:“Ihavetoexaminetheend‐to‐endscope,notjustaconvenientatomizationoftheprocess.Imustseektherealvalueinherentintheprocess,andmanageitonthatbasis.”Well,thefinalchallengeisthemostinsidious:it’stheproblemofperspective.Thischallengeisinsidiousbecauseyoucanmeetthefirsttwoexpectations—scopeandvalue—andstillfailinthemain.

Copyright A

BPM


200

Hearmeout.Allprocessesarebasedonperspectives.Theseperspectivescomefromthedesigner,thelineofbusiness,theITshop,theconsultant,thecustomer,thevendor,andsoon.Theideaofaperspectiveistypifiedbyoneofmyfavoritebigwords,Weltanschauung.Backingraduateschool,Iwasprivilegedtostudymethodologydesignwithsomeoftheworld’sexperts,andwealwaysseemedtocomebacktothisterm.Weltanschauungmeans“worldview,”andI’vebloggedonitabitifyouwantmoreinformation.Thebottomlineisthatyourworldview—Weltanschauung—colorsyourperspective.Itmightevenbesaidthatitisyourperspective.So,howyouviewrealitycolorshowyoudesignyourprocesses.

Now,let’smovefromthetheoreticaltothepractical.Ifyourprocessperspectiveisthatcustomersarecattle,itwillbereflectedinyourprocesses.Yourend‐to‐endprocessescanbemeasuredintheirentirety,andyoucanconvinceyourselfthatyou’remeasuringthepropervalueinherentintheprocess,butyourcustomerswillseethroughyouandrevolt.I’veseenafewbusinessesthatuseacommontactictoincreasesales.Theywanttheiremployeestopromoteacertainaccountfeature,fooditem,maintenanceplan,etc.,andtheprocessstates,“If,duringthecourseofourtransaction,wefailtoofferyouX,we’llgiveyouY.”The“Y”inquestioncouldbeadiscount,orafreetokenitem,orarebuketothesalesperson.Theprocessperspectiveisclear:“You,thecustomer,areawalking‐talkingpocketbookandwe’regoingtotrytoup‐sellyouateverychanceweget.”Thisiseasytomeasureonanend‐to‐endbasis:wereyouofferedtheitembeingpromoted,aspartoftheoverallprocess?Andtheprocessvaluetotheorganizationisprettyclear—increasedsales.But,howdoyoufeelaboutbeingtoldthatyou’reapigeoninacross‐saleopportunity?Howdoyoufeelbeingwarnedthatyou’regoingtobepesteredwithadd‐onsales?

Theprocessperspectivehereisinsidiousbecausetheprocessitselfisbroken.TheWeltanschauungofthisprocesssays,“MyworldviewisthatyouareasourceofrevenuethatIamtomaximize.”Intheend,doesthisprocessreallywork?Ifyoumanageitwell,haveyoureallymanagedtodeliversuccess?Ononehand,youdelivercashtothebottomline;ontheother,youinfuriatesomecustomerswhoobjecttoyourblatanthigh‐pressuresalestactics,allcandy‐coatedwiththeofferofafreebieifyouactuallyescapethesalestacticwhole.Intheend,processperspectivebecomesaclosepartnerwithrealvalue.Butit’suniqueenoughtocallout.WeltanschauungisafancyGermanword,butit’soneworthexamining.HowyouviewyourprocessstakeholdersisdeterminedbyWeltanschauung—yoursandothers’—anditwillframethewayinwhichyouassessoverallprocessvalueandresultantperformancemanagementactions.

Overcomingthesethreepitfallstoprocessperformancemanagementwillnotassureyouofsuccess,butthesearetrapsthatyouwanttoavoid.Often,thesetrapsareeasytospotinretrospect,butwhowantstolivelifeinaseriesofapologiesforhavingweakprocessskills?Also,thesetrapsarecombinatorial:theypileonyoulikeabadgameofRugbywhereyou’vegottheball,andscope,value,andperspectivekickyouwiththeircleats.Theyreallyareanuglytrio,soyoumustspotthemandexorcisethemfromyourpractices.Whetheryourprocessperformancemanagementefforts

Copyright A

BPM


201

areBAM‐drivenorjustold‐fashionedMBWA(managementbywalkingaround),doyourbesttodefineprocesses,metrics,andmeasuresthatareproperlyscoped,basedontherealvaluebeingdelivered,anddesignedfromtheproperperspectiveoftherealstakeholders.Todoanythinglessisjustaskingtobelabeledasirrelevanttoprocessperformancemanagement.

Copyright A

BPM


202

Contents

ForewordbyDavidMcCoy,ManagingVicePresidentandGartnerFellowEmeritus.........................................................................................................................................198

6.0 Introduction..........................................................................................................................204

ProcessPerformanceManagementSectionI......................................................................205

6.1 WhatisProcessPerformanceManagement?..........................................................205

6.1.1 TyingProcesstotheOrganization......................................................................206

6.1.2 ProcessMaturityDeterminesWhatisReasonablyMeasured................207

6.1.3 EvolvingAbilitytoMeasureProcessPerformance......................................211

6.1.4 Settingthestage..........................................................................................................215

6.1.5 Solvingthewrongproblem....................................................................................216

6.2 Whatisprocessperformance?......................................................................................216

6.2.1 Reality..............................................................................................................................218

6.2.2 HowdoesProcessPerformanceMeasurementdifferfromworkflowperformancemeasurement?.................................................................................................219

6.3 WhatcanProcessPerformanceMeasurementtellyou?....................................220

6.3.1 ProcessPerformanceMeasurementdrivingprocessmanagement.....221

6.3.2 HowdoesProcessPerformanceManagementfitinwithyourBusinessIntelligenceReportingandManagement?.......................................................................222

6.4 MeasurementandManagement...................................................................................223

6.4.1 Whatshouldbemeasured?....................................................................................223

6.4.2 Dailymonitoring:Dashboards..............................................................................225

6.4.3 MeasuringagainstKPIsandbenchmarks:efficiency.................................226

6.4.4 Inferenceenginesinperformancemanagement..........................................226

6.4.5 Trendandotheranalysis........................................................................................227

6.4.6 Satisfaction:experiencemeasurement(goodandnotsogoodexperiences).................................................................................................................................227

6.5 Findingouthowtomeasureperformance..............................................................228

6.5.1 Designingaperformancemanagementprocess...........................................229

6.5.2 DeterminingKPIsandStandardstomeasureagainst................................230

6.5.3 Determiningmeasurementapproachesandformula................................231

6.6. BuildingaPerformanceMeasurementCapability................................................231

Copyright A

BPM


203

6.6.1 TheroleofBPMStechnology................................................................................232

6.6.2 Legacyapplicationandbusinessreporting....................................................232

6.6.3 Buildingnewreportingisajourney..................................................................232

ProcessPerformanceManagementSectionII....................................................................233

Introduction.......................................................................................................................................233

6.7 Importanceandbenefitsofperformancemeasurement...................................233

6.8 Keyprocessperformancedefinitions........................................................................235

6.8.1 Time.................................................................................................................................238

6.8.2 Cost...................................................................................................................................238

6.8.3 Capacity..........................................................................................................................238

6.8.4 Quality.............................................................................................................................239

6.9 Monitoringandcontrollingoperations.....................................................................239

6.10 Alignmentofbusinessprocessandenterpriseperformance..........................242

6.11 Whattomeasure.................................................................................................................243

6.11.1 ProcessPerformanceMethods.............................................................................244

6.11.2 ValueStreamMapping.............................................................................................244

6.11.3 Activity‐BasedCosting.............................................................................................245

6.11.4 SPC—StatisticalProcessControl.........................................................................246

6.12 Thevoiceoftheprocess...................................................................................................247

6.13 Simulationoffuturestate................................................................................................251

6.14 Decisionsupportforprocessownersandmanagers..........................................253

6.15 Processperformancemanagementmaturityframework.................................254

6.16 Considerationsforsuccess.............................................................................................256

6.17 KeyConcepts.........................................................................................................................257

Copyright A

BPM


204

6.0 Introduction

ProcessPerformanceManagementinvolvesbothanunderstandingofwhattomeasureandhowtomeasureit.Thischapteristhusdividedintotwobasicsections—whattomeasureand(basically)howtomeasureperformance.

Performancemeasurementisthefoundationforperformancemanagement,andiftheorganizationdoesnothavetheperformancemanagementmaturitytosupportoften‐complexperformancemeasurement,theresultsofthemeasurementcanbemisinterpretedandcauseharminsteadofgood.

ThischapterthusdevotesconsiderablespaceinSection1todiscussingperformancemanagementmaturityinordertohelpcompanymanagersunderstandwheretheircompanystandsintermsofitsabilitytosupportperformancemonitoringandmeasurementandtointerprettheoutcomeofmeasurementactivity.

Thesecondsectionofthechapterismoremathematicalandmoreconcernedwithhowyoumeasureperformance.Successfulperformancemanagementrequiresamasteryofbothaspectsofthisissueandthedesignofanevolving,customizedapproachtodeterminingthecompany’strueperformanceasrelatedtoindividualprocesses.

Thisfocusonprocesswillbenewtomany,sincetheusualfocusisonfinancialorbusinessunitmeasures.Whilethesearecertainlyvalid,weareproposingadifferentgroupofmeasures—relatedtoprocess.Theseprovideacomprehensiveunderstandingofhowtheoverallprocessisperformingandhelpfocusprocessoptimization.

Copyright A

BPM


205

Process Performance Management Section I

6.1 What is Process Performance Management?

ThetermProcessPerformanceManagementisnormallyusedtoindicatethemanagementofthebusinessoperationatbothaprocesslevel(cross‐organizational)andaworkflowlevelwithinagivenbusinessunit.InaBPMcontext,itfurtherindicatesthatsomedegreeofflowmanagementistakingplaceto(1)identifybacklogsandshiftorredistributework,and(2)toidentifyqualityproblemsintimetocorrectthem.Thisimpliescontroloverthewayworkmoves,consistentresponsetoevents,qualitymeasurement(real‐time)andcontrolovertherulesthatdirectwork.

Thisdefinitionisapplieddifferentlyattheprocessandworkflowlevels:thescopeandlevelofmonitoringchangeasonemovestoprocessfromworkflow.

Thebiggestissuewiththeprocess‐leveluseofperformancemanagementisthatmanycompanieslackagoodunderstandingofwhattheirprocessesareorhowtheywork.Inearlierchapterswedefineprocessasbeingcross‐organizational.Whiletherearedifferentwaysofidentifyingandgroupingprocesses,theycanbasicallybeidentifiedbyworkingbackwardfromanend‐productorservice.Thatimpliesthattheyproduceahigher‐levelviewofalltheworkneededtodelivertheproductorservice.

Forpurposesofthischapter,wewillnotgointoprocessdefinitionorclassification.However,adiscussionofprocessmanagementmustbeginwithalookatprocess‘today.’

Itiseasytoassume,whenlookingatperformanceinaprocess,thattheprocessisdoingtherightthingsandthatmanagementshouldfocusonefficiencyinsteadofeffectiveness.Thisisnotagoodassumption.Theplacetostartanymanagementactivityiswithalookatthecurrenteffectivenessofwhatwillbemanaged.Ifitisaccomplishingthewrongthings,efficiencydoesn’treallymatter—thereisnobenefitindoingthewrongthingsfasterandmoreefficiently.So,wesuggestthatprocessperformancemanagementbeginswithexaminingtheprocessorprocessesthatwillbemonitoredforperformance.

Assumingthattheprocesseshavebeenidentifiedanddefinedcorrectly,weneedtoaskifaprocessiseffective—doesitdeliverwhatitissupposedto?Atthatpointwecanaskifunnecessarysubprocessesoractivitiesarebeingperformed.Inthisreviewwealsoneedtobreakwiththepastandaskiftheprocessincludeseverythingneededtoproducethedesiredoutcome.Everythingshouldbejustifiedbasedonitscontributiontothedeliveryoftheend‐productorservice.Leantechniquesaregoodinthisevaluation.Thegoalistoultimatelyimprovewhatweneedtodo,notsimplywhatwearedoingtoday.

Youshouldnotassumethateverythingwasokayorrighttostartwith—everythingshouldbereviewedandjustified.Considerasking:

Copyright A

BPM


206

Whyareweinthebusinesseswearein?Aretheyexclusiveofoneanother? Whatmarketsarewein,andwhatarethechallengesofthesemarkets? Whatdoesthecompetitiondobetterthanwedo? Whoisourtargetcustomerandwhataretheylookingfor? Arewegivingthemwhattheywant?Whatdotheythinkofus? Whatdoweneedtodotosupportourbusiness? Doesthecurrentbusinessprocesssupportastrategicgoal? Whatarethebiggestproblemsorchallengesweface? Whatproblemsdoweneedtosolvefirst? Whatdoweneedtodosolvethem?

Itshouldbenotedherethatcheaperisnotalwaysbetter.SomepeoplebuyaFerrariandothersaFordFocus:alongwithotherfactors,understandingthecustomer’smotivationforbuyingyourproductorserviceiscriticaltothebusiness.Itisthefoundationforanyreviewofaprocessanditsevolutiontooptimization.Withoutthisunderstanding,youmightlimitperformancemeasurementtotheusualtimeandmotionissues,orfailtounderstand“quality”andqualityrequirementsasanythingmorethanabstracttargets.Whiletraditionalmeasurementsareimportanttooperationaloptimizationandagoodstartingpoint,theydonotreallyhelpensurethatthecompanyisevolvingtoamodelthatbetterservesthecustomer.Bothefficiencyandeffectivenessareneededtoensurecompanyhealth.

Onceprocess(es)areidentified,defined,andunderstoodfrombothaninternalandcustomerpointofview,managementcancreateanapproachtoperformancedefinitionandthenmeasurementthatwillallowthemeasurementtoevolveasthebusinessandprocess(es)evolve.Thisistheonlywaytoavoidaprogramwhereyoustartmeasuringtherightthings,butdriftawayfromthebusinessasitchanges.

6.1.1 Tying Process to the Organization

Inthisreview,allsubprocessesandtheirlinkstobusinessunitsandthusorganizationmustbetracked.Allprocess‐levelandsubprocess‐levelchangeswillaffectthebusinessunitsthatsupportthemandanychangeattheselevelswillneedtobereflectedthere.Thislinkingallowsmanagementtounderstandthebigpictureanddealwithchangefromaprocessperspective;italsofostersthinkingabout,andunderstandingof,thedynamicinteractionbetweenprocessesinanyprocessredesign.

Fromthisperspective,managerscanalsounderstandwhoisinvolvedineachpartoftheprocessandwhattheirroleisinmakingitfunction.Inthiscontext,“role”meansresponsibilities;here,individualresponsibilitiescanbecombinedintospecificroles.

Thiswillhelpeveryoneunderstandwhoshouldbeinvolvedinanyperformancemeasurementandinanycorrectiveactionthatmaybeneeded.Ofcourse,thisshouldallbemodeled,usingthesupportinginformationassociatedwitheachsubprocessandatlowerlevelsofactivityinbusinessunits.

Copyright A

BPM


207

Oneofthemajorproblemswithmovingintoprocess‐levelperformancemanagementisthatthereviewercanbetooclosetotheprocessorsoaccustomedtoitthatitsfailingsaren’tapparent.Formany,thecurrentprocessesseemtolookright,butwhenobjectivelyanalyzedusingBPMtechniques,weaknessesandunneededworkcanoftenbefound.

Atthispoint,anewsetofconcernsbecomesrelevantinfindingwhattomeasure.Apartfromtheusualoperationalperformanceissues(asdiscussedlaterinthischapter),optimizationrequiresmorethanmeasuringthephysicalmovementofwidgetsandoptimizingtheirtimethroughthebuild‐process.Everyactivityhasacustomer.Everycustomerhasaneedandcanbeharmedbyunexpectedoutcomesfromthepreviousworker.Measuringmovementandexpectedoutcomeisanecessarygoodstart.Measuringexceptionsisalsoagoodbaselinemeasurement.Buthowmuchmorewouldyougetifyoumeasuredcustomerexperienceintheirworkandintheend‐activityoftheprocess—someonebuyingsomethingandinteractingwiththecompany?

Eachworkermakesdecisionseveryminuteoftheday.Somefollowrules,andsomedon’t.Itisimpossibletohaverulesthatgoverneverysituation:thelegalsystemhastriedthatandsohastheIRS.Bothcreatedsuchacomplexmessthatprofessionalshavehadtobeusedinbothcasesandtheystilldealwithgrayareasandinterpretations.

Also,supportqualitymustbeconsidered.AretheITapplicationscomprehensive—dotheyreallysupportthework?Aretheyhardtouse?Doworkersneedtologinandoutofapplicationstodosimpletasks?Howareissuesresolved?Aretheyresolvedinatimelymanner?

Theseandotherbaseissuesneedtobeunderstoodinlookingatperformanceandinmeasuringit.Suchunderstandingisalsonecessaryinlookingatperformanceresultsandinrequestingimprovementprojects.

Itisimportanttonotethatperformancemeasurementcanbehierarchicalandmeasureprocess,subprocess,workflowandactivitiesseparatelytocreateadrilldowncapabilityastheinformationislinked.

Inlookingatprocess,theteamwilllikelyrunintobothorganizationalandpoliticalsilos.ThesesilosbuildbrickwallsaroundworkandlimithowBPMandprocessmanagementcanbeperformed.Thisisthetoughpart.Itisalsothepartthatwillvarybycompanyandperson,somustbedealtwithdifferentlyineverysituation.

6.1.2 Process Maturity Determines What is Reasonably Measured

Whenconsideringprocessperformancemanagement,companiesneedtolookatwhatisrealisticthroughthelensoftheirprocessmaturitylevel.

Copyright A

BPM


208

ProcessMaturity:Thecharacteristicsandcapabilitiesthatdefinethecurrentstateofthecompany’smovetounderstandingandmanagingprocesses.

ProcessMaturityModelsrepresentajourneyfromastrictlyorganizationviewofworktoanintegratedprocessfocus.Atdifferentpointsinthisjourney,thecompanywillgenerallyfitintoagivenmaturitylevelorstagebasedoncharacteristicsthatcanbedefinedandaggregatedtoformadescriptionofthecompany’sabilitytounderstandandmanagetheirprocesses.Thecompany’sabilitytomeasureworkperformanceatanylevel(fromindividualtaskqualitytoworkflowtoprocess)isrelatedtotheirlevelofprocessmaturity,becauseateverylevelofmaturitythecompanywillunderstandprocessalittledifferentlyandwillhavebuilttheinfrastructuretosupportitatthatlevelofmaturity.Forexample,ifacompanyisatthebeginningofitsjourneytoprocessmanagement,itwillnothaveanunderstandingofprocessortheinteractionamongitsprocesses.Itwillalsolacktheabilitytounderstandhowworkaggregatesandhowitshouldbemeasured.Atthislevel,ProcessPerformanceMeasurementissimplynotpossible.Thesameistruefordata.Ifthecompanydoesn’thavetheabilitytoeasilyaccessdatafromalltheapplicationsinvolvedinsupportingaprocess,itcannotbecomeinvolvedincertaintypesofperformancemeasurementorincomprehensivebusinessintelligencereporting.Sothepositionofacompanyinaprocessjourney(shownintheProcessMaturityModel)canhelpproperlysetperformancemeasurementcapabilityexpectationsandshowaclearroadtoimprovedmonitoring,measurement,andreporting.

Note:TheABPMPdefinitionofprocessisassumedinthisdiscussion.Insummary,thisistheidentificationofalltheactivitiesneededtoproduceacompleteproductorserviceandtheaggregationofthecross‐organizationworkthatisinvolved.

Oftenthedesireforperformancemanagementandreportingisnotsupportablebecauseadisconnectexistsbetweenwhatacompanycanreasonablymeasureandmanagement’sneedforcontrolandmeasurement.So,instartingtolookatProcessPerformanceMeasurement,itisnecessarytoassessyourlevelofprocessmaturity,whichisnotaneasytaskgiventhatmanycompaniesmisunderstandwhatprocessis,whattheirprocessesmayinclude,orhowtheyinteract.

Afurtherproblemisthatfewpeoplewanttohearthattheyneedtochangethewaytheylookattheirorganizationorthattheymustrethinkwhattheyconsidertobestandardtermsordefinitions.Convincingpeopletochangethemselvesandtheirperspectivesisevenharderthanconvincingacompanytochange.Companiesresistchange—nonewsthere.Butpeoplehatechangeandsometimesgobeyondresistancetoactivelyfightit.Thefightcanbeinsidiousandtakeavarietyofforms:haveyoueverhadpeoplemakecommitmentsandthenjustnotliveuptothem?ThatiswhereaProcessMaturityModelbecomeshelpful,asitcreatesaframeworkthatpeoplecanunderstandandrelateto.Italsohelpsthemacceptthejourneyor

Copyright A

BPM


209

decidetorejectitandstaywheretheyare.Ineithercase,ithelpsdefinethefuturestrategyandapproachtoprocessandthustoProcessPerformanceMeasurement.

Ifaccepted,theProcessMaturityModelwillprovidetheguidanceneededtodefineandbuildaprocessevolutionplan.Thisplanwillshowwherethecompanybelievesitisinthematurityjourneyandwhatitneedstodotomovetothenextlevel.Thisthendeterminestheprojectsandtoolsthatareneededandhelpssetprocessmeasurementexpectations.

Tohelpmanagementunderstandthisjourney,westronglysuggesttheuseofanaccepted,formalProcessMaturityModel.Internallydevelopedonesarecustomized,butmaynotbeaswellthoughtoutastheindustry‐acceptedmodels.Theyarecertainlynotasdefensible.

Itisimportanttonotethatcompaniesmayhavedifferentbusinessgroups,divisions,linesofbusiness,subsidiaries,etc.indifferentmaturitylevels.Thisisalsotrueforindividualprocesses.Somemaybedefinedandothersnotyetidentified.Theuseofthemodelmustthereforebepartofadefined/formalprocessmanagementstrategywitharoadmapshowingthecurrentstateofprocessunderstandingandmanagement,andtheroadmaptoimplementingitbroadlyinthebusiness.

Therearemanyformalmodelstochoosefrom,andthetrickistofindonethatisacceptabletothemajorityofmanagersinthecompany.Adoptingonethenallowsyoutobuildaprocessmanagementmaturity‐improvementroadmapandprocessmeasurementcapabilityaroundit.However,carewillneedtobetakentofindandacceptamodelandapproachthatisbusiness‐basedandnotIT‐based.Technologyhelpssupportprocessesandprocessmeasurement.ItdoesnotdefinethemunlessyouhaveamatureBPMS‐supportedBPMoperatingenvironmentwithmodelsoftheentirecompanyanditsrulesenteredintotheBPMS.Seechapter9,“EnterpriseProcessManagement,”foradditionalinformation.

ForthischapterwechosetheframeworkfromtheForresterResearchProcessMaturityModel.However,asnoted,GartnerandmanyothershavegoodProcessMaturityModelsthatyoushouldreviewforbestfitinyourcompany.

ForresterResearchdividesProcessMaturityintofivestagesorlevels,asshowninthetablebelow.

ProcessMaturityLevel ProcessUnderstandingandCharacteristics

0—nonexistent Notunderstood,notformalized,needisnotrecognized

1—adhoc Occasional,notconsistent,notplanned,disorganized

2—repeatable Intuitive,documented,understood,occursasneeded

3—defined Documented,predictable,evaluatedoccasionally,understood

4—measured Well‐managed,formal,oftenautomated,evaluatedfrequently

Copyright A

BPM


210

5—optimizedContinuousandeffective,integrated,proactive,usuallyautomated

Formoreinformation,pleaseseethecorrespondingForresterreport,"FindYourTransformationEdge."

Table11.ForresterProcessMaturityModel,September2011

Discussionsshowthatmostcompaniesareinthe0,1,or2rangeofmaturityintheProcessPerformanceMeasurementmodel.Althoughmanyaretryingtomovetoaprocessorientationandthustohigherlevelsofprocessmaturity,fewhavemadethetransition.Carryingthismodelfurthertofocusonprocessperformancemanagement,weseethatperformancemeasurementcapabilitiescanbetiedtothelevelsintheProcessMaturityModel.

PartofthereasonforthisalignmentisthateveninthemostsophisticatedITandbusinessoperation,measurementistiedtounderstanding.Ifacompanydoesn’tunderstandprocess,itcannotlookatitcross‐functionally,anditcanonlymeasureperformanceintheseparatebusinessunits.Itcannottiethisinformationtogethertolookatbroadly‐relatedaggregationsofwork—realprocess.Thishasanimpactonperformancemeasurement,qualitymonitoring,costing,problemresolutionandmore.

UsingtheForresterProcessMaturityModel,weseethatperformancemeasurementtakesondifferentformsfordifferentlevelsofmaturity.Theseformsbuildfromleveltolevelasnewmonitoring,measurement,andreportingcapabilitiesareadded.TheyalsoassumeanITandbusinessenvironmentthatcansupportautomatedmonitoring,measurement,andreporting.Intheearlystagesofprocessmaturity,itisalsoassumedthatmanycompaniesmaywanttomanuallycheckactivitythroughmanualworkreviewstoconfirmmeasurementagainstKPIsandproductauditsforquality.

ProcessMaturityLevel

PerformanceMonitoring,MeasurementandReportingbyMaturityLevel

0—nonexistent IsolatedSixSigma,Lean,activity‐basedcostingetc.performancemeasurement—mostlyworkfloworientedwithsomeattemptsatprocessidentificationandmonitoring

1—adhoc Isolatedperformancemeasurementwithspecialqualityandoperationalproblemperformancemeasurement—mostlyworkfloworientedwithagrowingunderstandingofprocess

2—repeatable Ongoingprogramsofperformancemeasurement—differentwaysofmeasuringperformanceareusedfordifferentgroupsinthecompany(oftenworkfloworiented)

3—defined Processisseparatedfromworkflowandthedistinctionisclearinthecompany—performanceisgenerallymeasuredatthe

Copyright A

BPM


211

ProcessMaturityLevel

PerformanceMonitoring,MeasurementandReportingbyMaturityLevel

endoftheprocessandworkflow;performancemanagementisformalizedandaconsistentapproachistaken

4—measured Performancemeasurementisnowaddedatkeybreakpointsintheprocessesandworkflows;operationalperformancemanagementisguidedbyreal‐timeornear‐real‐timedashboards;Businessintelligencereportingfortrendanalysis;businessrules,processandworkflowdesignsandtheirtechnologysupportarenowreviewedbasedonperformancemeasurementandoptimized

5—optimized Performancemeasurementguidescontinuousimprovement;changesaremeasuredastheyareimplementedandonaregularcycletodeterminebenefit;SixSigmaandothertechniquesareusedtohelpguidefocusedimprovement;strategicchangesaresupported

Table12.ProcessLevels

Followingthelevelsshownabove,acompanycanorganizeajourneythroughperformancemeasurementthattiesitsabilitytounderstanditsprocessestomeasurementanditsabilitytosupportsolidautomatedmeasurementprograms.ThediscussionbelowalsoreferstothematuritylevelsoftheForrestermodel.Adetailedlistofthingsthatmaybeconsideredinbuildingaperformancemonitoringandmeasurementcapabilityispresentedlaterinthischapter.

6.1.3 Evolving Ability to Measure Process Performance

Note:DiscussionsintheblacktextboxesarefromtheForresterResearchProcessMaturitymodel.DiscussionsinthebluetextboxesareonPerformanceMeasurementforthematuritylevelinthelinkedblacktextboxes.ThebluetextboxesarediscussionsfromtheABPMPauthor.

0—nonexistent

(ProcessMaturitylevelfromForrester)

Notunderstood,notformalized,needisnotrecognized

0—nonexistent

(PerformanceMeasurementfromABPMP)

IsolatedSixSigma,Lean,activity‐basedcostingetc.performancemeasurement—mostlyworkfloworientedwithsomeattemptsatprocessidentificationandmonitoring

Table13.Processmaturitydescriptionforlevel0

Copyright A

BPM


212

Agreatmanycompaniesarestrictlyorganizationallyorientedandhavenotyetbeenconcernedwithprocess(asdescribedabove).Othersareawarethattheremustbeprocessesintheircompaniesbutlookatthemasafewstepswithinbusinessunits.ThesecompaniesareatthebeginningoftheirBPMjourney.

Atthisstageinitsevolution,managementcanexpectmanydifferingopinionsonwhatprocessisandhowitshouldbemeasured.SomegroupswilltrySixSigmaatthispoint,butitwillnothaveabroad(process)applicationandwillhavelimitedimpact.

Performancemonitoringwillbevirtuallyunknownandthecompanywillhaveverylimitedabilitytomonitorwork,measureimprovementorsuccessinmeetingstandardsorKPIs,andevaluateperformance.Measurementatthisstageinthecompany’sprocessevolutionwillberudimentary,andspecial‐purpose,after‐the‐factreportingwilldominateperformancereporting.

Asmentionedabove,becausecompaniesatthislevelofprocessmaturitydon’tknowtheirprocessesortheworkthatmakesthemup,theydon’thavetheabilitytomeasureprocessperformance.Performancemeasurementatthisprocess‐maturitylevelisfocusedtohelpdriveevent,workflow,orproblem‐specificmeasurement.Reportingisgenerallylimitedandtheabilitytocombinedatasourcesforbusinessintelligencereportingisgenerallystillinthefuture(seeTable14).

1—adhoc


Occasional,notconsistent,notplanned,disorganized

1—adhoc


Isolatedperformancemeasurementwithspecialqualityandoperationalproblemperformancemeasurement—mostlyworkfloworientedwithagrowingunderstandingofprocess


Ascompaniesrecognizeaneedtoviewprocess,manybecomeawarethattheyareinhibitedbytheirlackofprocessunderstanding.Astheybegintounderstandwhatprocessis,theyoftenrecognizethattheirprocessesareinconsistentandproducevariousresults.AtthispointmanyturntousingSixSigma,Lean,orotherimprovementapproachesatabroaderlevelanddogainsomebenefit.Buttheseeffortsareusuallyreservedformoreprogressivebusinessareasandcoreprocesses.

Performancemeasurementisgenerallyfocusedongivenqualityissuesorbusinessunitcostreduction—usuallythroughstaffreduction.Performancemeasurementnowbecomesagoalformanymanagers—butnotall.Somemanagersalsotrytomovetowardidentifyingcross‐functionalprocessesandbuildprocessmodels.The

Copyright A

BPM


213

modelsaregenerallysimpleanddonothavemonitoringorperformance‐reportingcapabilities.

However,withoutprocessidentificationbackedattheexecutivelevel,concernforProcessPerformanceMeasurementisoftenuncoordinatedandlimitedtotheportionsorprocesswithinabusinessunit—ineffect,workflow.Reportingstillcannotconsidertrueprocesses;onlysomepartsofprocessesarerecognizedasbeingrelated,andperformancemeasurementcannotbeembeddedinwhatisstillnotgenerallyknown(process).Measurementcapabilitiesarestillfocusedonafewtasksinaworkflowandbroaderperformancemeasurementcannotbeaccomplished.Broad‐basedperformancemeasurementisgenerallynotavailablebecauseonlysomeofthebusinessunitmanagersinanyprocesswillhaveacceptedattemptstomeasuretheirwork(seeTable15).

2—repeatable


Intuitive,notdocumented,occursonlywhennecessary

2—repeatable


Ongoingprogramsofperformancemeasurement—differentwaysofmeasuringperformanceareusedfordifferentgroupsinthecompany(oftenworkfloworiented)


Agrowingawarenessofprocessbecomesmanifestinattemptstogainanend‐to‐endviewoftheactivitiesofsomelocalizedprocess.SomemanagersnowattempttoimprovethewayprocessesworkbyidentifyingKPIs.Understandingbusinessrulesnowbecomesimportant.However,processesarestillnotidentifiedcompletelyandfew,ifany,areaccuratelydocumented.Simplemodelingtoolsmaybeinplace,butmodelsvaryincontentandquality,andfewarekeptuptodate.Thereisalsonotiebetweendailyworkandtheseearlyprocessmodels.

MeasurementofanykindisstillrelegatedtofocusedSixSigmastudies,manualauditsofworkflowforquality,andmanual“piecework”counting.Systemsdataisstillseparateandthereislittleabilitytocombineinformationfrommultiplesystemsanddatabaseswithoutcustomprogramming.Reportingisimproving,however,asmanagersstarttounderstandprocessandtheirrolesintheprocessestheysupport.

Becauseprocessawarenessistakingplace,managementmayforceamanualcombinationofinformationforperformancemeasurement.Forthoseprocessesthathavebeendefined,ProcessPerformanceMeasurementisstillfundamentalandinflexible.Italsorequiresagreatdealofcustomprogramming.

3—defined

(ProcessMaturityDocumented,predictable,evaluatedoccasionally,understood

Copyright A

BPM


214

levelfromForrester)

3—defined


Processisseparatedfromworkflowandthedistinctionisclearinthecompany—performanceisgenerallymeasuredattheendoftheprocessandworkflow;performancemanagementisformalizedandaconsistentapproachistaken


However,atthistime,mostprocessesarenotidentifiedanddefined.BPMStoolsareinplaceandsignificantpartsofthebusinessarenowrunusingBPMS‐supportedBPMoperatingenvironments.Processisnowfullyvisible,alongwithallitsinteractionswithotherprocessesandexternalpartners.Managementunderstandswhattheyareandhasvisibilitythroughformalcross‐organizationprocessmodels.Processesarenowdecomposedtosubprocesses,thenlinkedtobusinessorganizationunitsand,withinthem,activityandworkflow.Applicationuseisnowvisibleandproblemsaredefined.

Legacyandpurchased/leasedapplicationsarenowlinkedtotheBPMS‐supportedbusinessoperationsanddefinedforthosebusinessoperationsthatarenotusingaBPMStosupportchangeandoperations.DataisnowgenerallyavailableforreportingfromtheBPMSandlegacyapplications.Formalizedperformancemeasurementisnotwidelyavailable,butmuststillbedefinedandevolvedtoprovideagrowingneedforoperationalinformation(seeTable17).

4—measured


Well‐managed,formal,oftenautomated,evaluatedfrequently

4—measured


Performancemeasurementisnowaddedatkeybreakpointsintheprocessesandworkflows;operationalperformancemanagementisguidedbyreal‐timeornear‐real‐timedashboards;Businessintelligencereportingfortrendanalysis;businessrules,processandworkflowdesignsandtheirtechnologysupportarenowreviewedbasedonperformancemeasurement,andoptimized


ThislevelischaracterizedbythefullimplementationofaBPMS‐supportedBPMoperatingenvironment.Processesarewelldefinedinthesecompaniesandareformallymanaged.Thismanagementisusuallyatypeofsecondarystructurethatworkswiththeorganization.Herebothprocessperformanceandworkflowaremeasured(1)innear‐real‐timeforoperationalinterventiontoresolveproblemsand

Copyright A

BPM


215

(2)forbusinessintelligenceandimprovementreporting.SixSigmaandnormaloperationalmetricsaremeasuredandusedtoguidethebusiness.

Performancemeasurementisnowintegratedintothebusinessoperationsandnearreal‐time‐dashboardsreportbackups,problems,andoftenofferactionrecommendationsthroughtheuseofinferenceenginesrelatedtoeventorsituationalbusinessrules.Performancemeasurementnowbeginstomakeatransitionfromafter‐the‐factreportingtoreal‐timeperformancemanagement.

5—optimized


Continuousandeffective,integrated,proactive,usuallyautomated

5—optimized


Performancemeasurementguidescontinuousimprovement;changesaremeasuredastheyareimplementedandonaregularcycletodeterminebenefit;SixSigmaandothertechniquesareusedtohelpguidefocusedimprovement;strategicchangesaresupported


Continuousimprovementcannowbeimplemented(seeTable18).Theorganization’soperatingchangescannowbequicklyreflectedintheprocessesandtheirsupportingapplicationsanddata.Legalmandatecannowbeimplementedquickly,andchangesdirectedbyperformancemeasurementtools/techniquessuchasSixSigmacannowbedesigned/tested/implementedwithinweeks.Thisenvironmentallowschangetohappenquicklyenoughtocontinuouslyreacttoimprovementopportunities,firstoptimizingthebusinessoperationandthencontinuingtooptimizeitasissuesareidentifiedorrequiredchangesaredefined.

PerformancemeasurementisnowbuiltintotheprocessesthroughtheuseofBPMSandexternalreportingtools.Bothtraditionalperformancemanagementandbusinessintelligencereportingarenowusedtoidentifyproblemsandquicklymakethechangesneededtoresolvethem.

6.1.4 Setting the stage

Thisstateisthefinalpointintheevolutionofprocessmanagementandperformancemeasurement.Herethetwoaremeldedintoone,wheremeasurementdrivesmanagement.Thisjourneywillhavetakenyearsformostcompaniesandrepresentsalong‐termstrategiccommitmentonthepartofexecutivemanagement.

Beforeperformancemeasurementisseriouslyattempted,however,itisrecommendedthatacompanyhonestlyevaluatewhereitstandsonitsjourneytoprocessmanagementanditscapabilitiesinsupportinganymeasurementorapproach.

Copyright A

BPM


216

6.1.5 Solving the wrong problem

Caremustbetakeninbuildinganyperformancemeasurementsystemtoensurethatitfocusesontherightissuesandtherightpartsoftheprocess.Tohelpidentifythethingsyouwillmeasure,considerationmustbegiventolegalreportingrequirements,financialreportingrequirements,performanceagainstKPIsandmilestonesinthework,backlogsandvolumesagainststandards,qualityagainststandard,scrap,error,andmore.

Butbeyondthesenormalperformancemeasurements,considerationshouldbegiventoinference,trends,andsatisfactionofvariousinternalandexternalcustomersastheoutcomesofworkmovefromsubprocess(andbusinessunit)tosubprocess.

Thesewillnotallbeapplicabletoeverycompany.Thereisnoonelistthatfitsallsituations.

6.2 What is process performance?

Simplequestion,butnotasimpleanswer:“Itdepends.”Thatistheproblem.

Becausecompaniesoperatewithdifferentlevelsofperformanceunderstandingandwithverydifferenttechnicalreportingcapabilities,thiscanactuallyhaveafewdefinitions.

ProcessPerformance:ThemeasurementofspecificoperationalcharacteristicsasdefinedbyKeyPerformanceIndicators(KPIs),standards,laborcontracts,thefinancedepartment,industrybestpractices,ISO,andothers.Inthismeasurement,thecompanywillbelookingatoneormoreprocessesandtheirinteractionstodeterminetheirperformanceagainstthesemeasurementcriteria.

Someofthequestionstoaskinfiguringoutwhatprocessperformancemeansare:

Whattypeofperformanceareyoutalkingabout?—Forexample,cost?Againstwhatmeasure?—Quality?Qualityofwhat?Andhowisitdefined?—Cycletimeperwidget?

Againstwhatmeasure,andwhatarethecomponents?Here,forexample,isitjustspeed,orisitspeedwithquality?

Sotheanswerisnotreallystraightforward.Itreliesfirstonyourdefinitionandwhatyouaretryingtomeasure,againstwhatmeasureorstandard.Andtomakethingsalittlemorecomplex,thedefinitionsofanymeasurewillvarybyindustry,lineofbusiness,department,andmanager.Thatiswhyanyperformancemeasurementmustbeginwiththeidentificationofwhatyouwillmeasure,whyyouwillmeasureit,andagainstwhatvaluesyouwillevaluateit.Withoutthisyoumayverywellmeasurethewrongthing,inthewrongway,andagainstarbitrarylimits.

Copyright A

BPM


217

Todealwiththis,itisrecommendedthatyoustartwithaworkshopandlookattheobjectofmeasuringperformance,whichisnotverystraightforward.Itisdefinitionalandthusopentointerpretation.Withoutcontrol,noonecanwinanythingthatismeasuredbyinterpretation.

So,firstcomesthelistofwhattomeasureandwhy.Hereitisimportantthatalltherightmanagersattendtheworkshop.Iftheydon’tattendtheworkshop,theywillnotbuyintothis.Thatmeansthatanymeasurementwillbesubjecttodebateandtheresultswillnotbeacceptedbysome.Thefactisthatifmanagersdonotattendthisworkshop,themovementtoperformancemeasurementisdestinedforfailure.Ifthisisthecase,itissuggestedthathigherauthoritybebroughtintothemovementandparticipationmandated.Ifthisisresistedbyhigherauthority,failureisinevitableandmeasurementwillberelegatedtosmallpartsofthebusiness—workfloworloweryet,taskoperation.Hereasinglemanagerwillstillneedtobacktheeffort.

Workshopmeasurementlist:

Goalofmeasurement Thingtomeasure Measureagainst

Onceeveryonehasagreedonthelistofthingstomeasure,itwillbenecessarytolookathowtheywillbemeasured.Hereprocess,subprocess,orworkflowwillbeaddedtothelist’smeasurementdefinitions.

Goalofmeasurement

Thingtomeasure Measureagainst Wheretomeasure

Nexttheworkshopmanagerswillneedtoidentifywhatwillneedtobemeasuredtoproducevalidresults.

Goalofmeasurement

Thingtomeasure

Measureagainst

Wheretomeasure

Whattomeasure

Finally,theworkshopmanagerswillneedtoidentifyeachmeasurementtobemade(theformula,count,etc.andwhattheywillbemeasuredagainst—standard,KPI,etc.).

Copyright A

BPM


218

Goalofmeasurement

Thingtomeasure

Measureagainst

Wheretomeasure

Whattomeasure

Howitwillbemeasured

Ifapersonorgroupwillberesponsibleforthemeasurementanditsquality/accuracy,theywillbeaddedtothemeasurementinformation.

Goalofmeasurement

Thingtomeasure

Measureagainst

Wheretomeasure

Whattomeasure

Howitwillbemeasured

Responsibleformeasurement

Ifneeded,moresupportingdefinitionalorotherinformationcanbeadded.Aswithallofthesesuggestions,thelistinthesechartscanbemodifiedtosupportcompanyneeds.Accordingly,whatismeasuredisasecondaryconcernhere,becauseitcanchangeovertimeasthemanagersbecomemoresophisticatedintheiruseofthisinformationandthecompanymovestomorematurelevelsinitsjourneythroughprocessperformancemanagement.Theimportantthingisthatthemanagerswhowillbeheldaccountablefortheresultsofthemeasurementneedtoparticipateinthecreationofboththemeasurementapproachandthemeasurementformula.

6.2.1 Reality

Althoughthisendeavorisgreatintheory,itisdifferentinpractice.First,inmostcompanies,itisinformal.CompanieslikeUPS,whichhaswell‐definedprocessesandmeasureseverything,shouldbeconsideredexceptionsbecausetheyrepresentfairlymatureprocess‐focusedmanagement.Othercompanies,likeSloanValveandRaymondJamesFinancial,areontheirwaytochangingtheirfocustoincludeaprocessview.Oncethatiscompleted,processperformancemanagementisnotfarbehind.

Inthemovetowardprocessperformancemanagement,itisimportanttorealizethatwhatmanagementinitiallyconsidersanimportantindicatorofperformancewillbetemporary:itwillchangeasmoreinformationbecomesavailableandtheyareabletomanipulateitinincreasinglyflexibleways.Thischangewilllikelybetiedtothelevelofprocessmanagementmaturityinthecompany.Whiletheexactreportingneedscannotbepredicted,itisagoodbetthatuseoftheinformationwillbecomemoresophisticatedovertimeastheabilitytoaccessandquerythedataimproves.

Copyright A

BPM


219

Formostcompaniestoday,aprocessperspectivewillbefairlynew,andmeasuringitsperformancewillbenewer.Managingexpectationsatthistimeisthusveryimportant.Itwillbeeasytooverpromiseandfailtomeetexpectations,whichwillcauseseriousconfidencedamage.Forthisreason,ensuredeliveryofsupportbasedonarealisticevaluationofthecompany’sabilitytosupportmeasurement—beforemakingpromises.

6.2.2 How does Process Performance Measurement differ from workflow performance measurement?

AsnotedearlierintheCBOKandinthischapter,wefindthatagreatmanycompaniesdefineprocessandprocessmanagementastheworkthathappenswithinagivenbusinessunit.ABPMPofficiallydisagreeswiththisdefinition,butformanycompaniesitreflectsrealityandneedstobeaddressed.

Inpractice,workflowcanbemeasuredinmuchthesamewayasprocessexceptthatitreferstotheactivitiesinabusinessunitandtheirapplicationsystems,rules,databases,data,webservices,webportalapplications,interfacesandlegacyapplications.Thesearepartofaprocess,andthisinformationwillneedtobeaggregatedwiththatfromrelatedworkindifferentbusinessunitstoformaprocess.

However,dependingonwhereabusinessisinitsprocessmaturityjourney,workflowperformancemeasurementmaybeallthatiseitherappropriateoravailable.Apartfromprocessmaturitylevel,too,itisverypossiblethatanimprovementeffortwillfocusonabusinessunit’sworkflowactivityortheactivity’stasks.Thisisespeciallytrueformanycustomerexperienceimprovementprojects.Intheseprojects,performancewillbemeasuredintermsofimprovementattheproject’slevel.Thismayrequirespecialconsiderationindesigningthesolutionandretrofittingperformancemeasurementintotheworkflow.

“Process”asdefinedbyABPMPiscross‐organizationalandtakesinallworkofanytypeneededtobuildanddeliveraproductorservice.Hereprocesscanbebrokenintosubprocessesandthesubprocessesperformedbybusinessunitsasaseriesofinterrelatedandsequencedactivities—workflow.Oncethisstructureisknown,theprocessescanbemonitoredbyaggregatinginformationfromtheworkflowlevelandforthehandoffsbetweenthebusinessunits.

IfaBPMS‐supportedBPMoperatingenvironmentisinplace,thismeasurementisfairlystraightforwardandtheinformationcanbeobtainedfromtheBPMSandassociateddatabases.However,ifthebusinessunitissupportedbytraditionalapplicationssystems,thecollectionofthisinformationwillneedtodrivecustommonitoring‐and‐measurementprogrammingandthemodificationofexistinginterfacestolegacyapplicationdata(fromalltheapplicationsthatareusedineachbusinessunitthatispartoftheprocessbeingmeasured).

Thequestionsthatcanbeaskedandansweredvarybythelevelbeingqueried—processorworkflow.Attheworkflowlevel,thefocusmustbeonthephysicalmovementofworkfromoneactivitytothenextandtheplaceswherequalityorotherproblemshappen.Attheprocesslevel,thefocusisonthemovementofwork

Copyright A

BPM


220

betweenbusinessunitsandthequalityofwhatishandedtothenextbusinessunitdownstreamintheworkorprocessflow.Atbothlevels,however,thethingsbeingmeasuredwillbefairlyconsistent—cycletime,quality,decisionaccuracy,etc.Thedifferenceisthuscontext,andhowtheinformationcanbeappliedtoimprovetheoperation.

6.3 What can Process Performance Measurement tell you?

Toalargedegreetheansweris“thatdepends.”Itisrelatedtoseveralfactors,including

Levelofflexibilityinaccessingdatafrommultipleapplications Processunderstanding—processmaturitylevel Sophisticationinaskingperformancequestionsandmeasuringactivity,

quality,etc. Agreementonwhattomeasureandhowtomeasureit AbilityofITtobuildflexibleperformancemeasurementapplications Reportingpresentationanddatadrilldown Acceptanceofperformancemeasurementbythosewhowillbemeasured.

Note:theorderofitemsonthislistdoesnotrepresentimportance,difficulty,etc.

Assumingtheseissuesareaddressedanddonotlimitacompany’sabilitytomonitor,measure,andreportperformance,thisinformationcanbethefoundationforbothimmediateandcontinuousimprovement.

BecausetheabilityofanycompanytomeasureprocessperformanceisdirectlyrelatedtothetypesofcapabilitieslistedintheProcessMaturityModels,itisnecessarytotiethesemodelstothecompany’smeasurementandreportingcapabilityinordertosetinformationexpectationsandcreateameasurementevolutionplan.Thisallowsthecompanytoputinplacetheunderlyingmeasurementcapabilitiesitwillneedforanymeasurementindividually.Managementcanthusdeterminewhatinformationtheyneedandthenunderstandwhatitwilltaketobuildtheabilitytogetandreportonthatinformation.

Formanymanagers,collectionofthisinformationisdirectedtosupportcertainmeasurementapproaches,suchasSixSigmaorActivityBasedCosting.ForothersitwillbemorestrategicandsupportBusinessIntelligencereportingwithdrilldownandsimulation.However,performancemeasurementcanprovideacomprehensivelookatthebusinessoperationatanylevelofdetail—process,workflow(organization),ortask.Someofthethingsthatmaybemeasuredareshownlaterinthischapter.

Inreality,acompany’suseofprocessperformancereportingwillevolve.Initialusesmayleadtosomeormanyofthewrongthingsbeingmeasured,andthusthestorythatthedatatellsmaybeincomplete,partiallywrong,oroflimiteduse.Asmanagement’sunderstandingoftheinformationandhowitcanbeusedimproves,thetypeofinformationandthewayitispresentedwillchange.Thiscreatesanevolution.Thespeedofthisevolutionisbasedonactualuseofperformance

Copyright A

BPM


221

information—themoretheinformationisused,themoremanagementwilllearnabouttheirrealreportingneedsandtheusestheinformationcanbeputto.And,aswithallgoodthings,themorebenefitsomethingprovides,thefasterdemandforitwillincrease.

Creatingthislevelofuse,however,requirestimeandcommitment.Managerswillneedtogothroughthelower‐valuestartupofthecompany’sperformancemeasurementprogramtoevolvetothehigh‐valuestage.Thisisnotedheretohelpsetexpectations.

6.3.1 Process Performance Measurement driving process management

Toreiterate,fewcompaniescurrentlytakeaprocessviewofperformancemanagement.Manymanageorganizationallyandlookatfinancialindicatorsthatprovidefairlygrosslevelindicationofperformanceorhowtoimproveit.Manyothershaveimplementedqualityprogramsandattempttoinferperformancebasedonstatisticalvariancefromindustryorotherstandards.Botharegoodstartsandsoundapproachestoperformanceimprovement,buttheseandvirtuallyallotherapproacheslacktheframeworkneededtoactuallyseewhatthedataistellingmanagementand,further,whatactiontotaketoleveragetheinformation.Botharegoodindicatorsthatsomethingishappening,butnotofwhyorhowitishappening.Evenworse,feworganizationscanactuallyanalyzetheoperation,redesignthepartsneededtochangetheperformancenumbers,andthenbuildormodifytheapplicationsneededtoimplementthechanges.

So,althoughmeasurementtakesplace,theframeworkneededtounderstandthemeaningofthedataandthenactuponitismissing.Asaresult,eveniftheinformationcanbeproperlyinterpreted,littlecanbedonewiththestoryitistellingandlittlecanchangequicklyenoughtomakeadifference.

Recognizingthatanymovetomeasureperformanceandthenactontheinformationisagoodstartforcompaniesatearlylevelsofprocessmanagementmaturity,thekey(again)istomanageexpectationsaccordingtoreality.

Asthecompanymovestohigherlevelsofprocessmanagementmaturityandthusprocessmeasurementmaturity,itwillalsomovethroughadifferenttypeofBPM‐supportevolutionthatwillleadtothebroad‐basedorstrategicuseofBPMStoolsandtechnologies.BPM—especiallyaBPMS‐supportedBPMbusinessoperationwithSOAandweb‐services‐basedaccesstoapplicationsanddata—changesthepicturebyallowingmanagementtoputthedataobtainedfromperformancemeasurementapproachesandreportsintoaframework(asdiscussedinchapter10,“BPMTechnology”).Thisframeworkisthecontextforevaluating,atthenecessarylevelofdetail,thestoryofthedata.

Withthisframeworkinplace,itispossibletoviewtheperformanceinformationthatisavailableinadifferentway—awaythatisbasedoncontext.Heretheupstreamanddownstreamactivityisshownandthecausesofproblemscanbefound.Solutionstoimprovevolume,quality,andcustomerinteractioncanbebetter

Copyright A

BPM


222

considered,modeled,simulatedtodetermineresults,andthenfullybuiltwithaccesstolegacyapplications,businessrules,performancemeasurement,andmore.

Qualitymeasurementvs.performancemeasurementvs.financialmeasurementcannowbeappliedtoprocessorworkflow,eitherseparatelyortogether.Eachapproachtoapplyingmeasurementprovidesuniqueinformationfromtheperspectiveofthegrouprequestingthemeasurement.Whencombined,thisinformationcantellapowerfulstory:toquoteanoldproverb,“thewholeisgreaterthanthesumofitsparts.”Forthisreason,itissuggestedthattheinformationfrommeasuresbasedonthesethreeperspectivesandothers,ifused,becombinedandreviewedquarterlyinaworkshopwithexpertsfromallmeasurementperspectives.Thiswillprovideinsightsthatmightotherwisenotbeavailable.

6.3.2 How does Process Performance Management fit in with your Business Intelligence Reporting and Management?

BusinessIntelligence:Computer‐basedtechniquesusedtoidentifyandanalyzeinformationabouthowthebusinessisperforming.Thisincludesstatisticalanalysis,trendanalysis,costandprofitabilityanalysisandmore.Italsoincludesmoreadvancedreportingsuchasinference‐andlimit‐basedalertsforbothinterventionandlong‐termstrategicchange.

TheinformationobtainedfromperformancemeasurementcanbeusedtoaugmentotherBusinessIntelligence(BI)informationfromavarietyofinternalandexternalsources.Also,usingaBPMSrulesengine,thisinformationcanberunthroughinferenceanddecisionfilterstoprovidebothreportinginformationandrecommendationsonactions.

Formanycompanies,performanceinformationobtainedaspartofaBPMS‐supportedBPMoperatingenvironmentwillprovideanewtypeofdatatotheBIreportingcapability.Itwillallowmanagementtolookatnewdatasources(processandworkflow—cost,volume,quality)andasknewquestionsonoperatingperformance—bothhistoricalandcurrent.Todrivethisreporting,itissuggestedthatBIneedsbeconsideredwhenlookingatwhatdatawillbeobtainedandwhereitwillcomefrom.(Seethischapter’ssubsection6.4.1forasamplelistofinformationthatmaybeconsidered.)

WhenperformanceinformationisaddedtotheinformationavailableforBIreporting,italsoallowsmanagementtobuildaBIperformancefeedbackloopintoperformanceimprovement.Managementcanusethefeedbacklooptoimprovetheircontroloverresponsestoinformationandalertsandtoadjustlimitsplacedonmeasurementastheoperationimproves.ThistiestheBIreportingintocontinuousimprovementandallowsmanagementtoadjustoperatingvariables(staff,volume,

Copyright A

BPM


223

ITsupport,etc.)andmeasurethechange.Inthisway,BIbecomesadriverinthecompany’scontinuousimprovementprogram.

6.4 Measurement and Management

Performancemeasurementissimplydata.Ittellsastory,butthestoryisinterpretive.Theinterpretationisbasedontheperspectiveofthepersonorgroupconsideringthedataanditscontext,andperspectiveiswhatresultsindifferentinterpretationsofthesamedatabydifferentgroups.Forexample,internalandexternalcustomersofanyworkmayhaveverydifferentideasofperformanceandverydifferentwaysoflookingatthedataproducedfromtheperformancemeasurementprocessesthatareinplace.Amongthefactorsthatcausethisdifferingperspectiveare

Businessobjective—differingopinionsonwhyissomethingbeingmeasured Valuelever/driver—event/outcome;valuetotheconsumer;importance KPI—standardvaluetocompareagainstandwhatthatvalueistryingtosay Metricdefinitionsandhowsomethingismeasured—limitsinvaluesand

theirimportanceinmeasuringperformance.

Whiletheseandmanyotherfactorsformthebasisforopinionandperspective,measurementconcernsgobeyondissuesofopiniontoacceptance(ornot)ofthewaysomethingismeasured—theformulathemeasurementprogramorpersonusesandtheapproachtakentoensurequalitydataandcalculations.Whilethelistaboveprovidesexamplesofthingsthatcausedisagreementoverwhatisbeingmeasuredandwhatitisbeingcomparedagainst,therealproblemisinthewaythingsaremeasured.Thisisthebasisofmeasurementrejectionanddismissalofmeasurementreports.Assuch,itiscriticalthateveryoneinvolvedagreestothewaythingsaremeasuredandthatthisagreementisreviewedonaregularcycletoensurecontinuedacceptance.

6.4.1 What should be measured?

Thefollowingareperformanceandqualitymeasurementcategoriesthatshouldbeconsidered.Thelistisnotmeanttobeall‐inclusive;itismeanttopromotethinking.Specificprocessesoractivitiesmeasuredwillvarybycompany,process,maturitylevel,andcomplianceneed.

Operational Performance

Processlevel:o Transactionvolumeo Eventreactiontimeo Backlogbysubprocesso Cycletimebyeventreactiono Numberoferrorsinprocessingo Numberofexceptionstonormalprocessingo Waste—time,materialo Problemswithtradingpartnersandcollaborativepartners

Copyright A

BPM


224

Workflowlevel:o Transactionvolumeo Backlogbyactivity—bottleneckso Numberoferrorsbyactivityandpersono Numberofexceptionstonormalprocessingo Numberandlocationofdecisionandotherdelays(exitsandreentry

points)o Problemswithexternalworkforce—sales(agents),claimsadjusters,

offshoreservices

Financial

Processlevel:o Costofeachsubprocess—staff,material,computerchargeback,G/Ao Costofgoodssold—processwithcostsofexternalwork—worksent

tootherprocessesandreturnedo Scrapo Savingsfromanewsolution

Workflowlevel:o ActivityBasedCostingo Savingsfromanewsolution—standaloneorrolluptotheprocess

level

Legal

Processlevel:o Legalcomplianceo Compliancereporting—ontimeandcomplete

Workflowlevel:o Applicationofunionagreementtermso Legalcompliance—e.g.SOX,HIPAA,Dodd/Franko Measurementtosupportcompliancereportingattheprocesslevel

Problem identification

Processlevel:o Handoffissueso Editdatabasequality—duplicaterecordsetc.o Auditandinspectionresults—manualofinterimcomponentsand

finalproductso Delayswaitingforadditionalinformation

Workflowlevel:o Handoffqualityo Dataentryedit—rejectionsbyreasono Identificationofrulesthatdonotworkcorrectly

Customer Experience

Processlevel:

Copyright A

BPM


225

o Customerinteractionsatisfaction—Interactionwithcompanyviasalesstaff,webportal,phone

Workflowlevel:o Companyerrorinorders,etc.o Problemresolution—phone,email,fax,andotherinteractionwith

customerstoobtaindataorcorrectinformation

Quality

Processlevel:o SixSigma,TQMetc.qualitymonitoringo Audit/inspectionofproductsub‐assembliesorcomponentsof

serviceso Audit/inspectionoffinalproduct—errorandrejection

Workflowlevel

Theresultsofworkmonitoringandperformancemeasurementwillbereportsthatshouldeithergenerateanactionbymanagementorprovideinformation.Thecontentofthesereportswillvarybasedonwhattheyaretryingtomeasure;performancemeasurementshouldbeuniquetotheneed.However,itmaybenecessarytolookatperformancemanagementneedsinaggregateandidentifyallthedatathatwillbeneeded,alongwithsourcesofthedata.ThecollectionandstorageofthisdatathenbecomesanITissue,butitwouldbeusefultohavealltheneededdatainoneplacetosupportdrilldownandflexiblereporting.

6.4.2 Daily monitoring: Dashboards

Datamaybereportedinavarietyofforms.Somearedetailedandsomearesummary.Thebestformisalwaysrelatedtouse.Fornear‐real‐timesummaryreporting,dashboardsthatcontinuouslychangetoreflectwhatisbeingmeasuredtendtoprovidemanagementwithaconstantviewoftheoperation.Whenthesedashboardsaresupportedbyintelligenceintheformofrules,thereportingcanprovideananalysisthatgivesmanagersalertstogrowingproblemsandprovidesrecommendationsonactionthatshouldbeconsidered.

Anydashboardshouldbedesignedtoprovideaclearpictureofaspecificpartoftheoperation.Thefocuscanbeonorganization,process,workflow,oralmostanypartofthebusiness.Theinformationshownwillevolveasmanagementtradesthedisplayoflessmeaningfulinformationforinformationthatismoremeaningfulatagivenpointintime.Thedefinition,datacontent,displaysummary,andcreationofthesedashboardsshouldthereforebemadeasflexibleandeasytochangeaspossible.

Dashboardsserveasastartingpointforlookingatperformanceand“drillingdown”intothedetailthatsupportsthesummary.Thisdrilldowncanbescriptedtoallowaconsistenttypeofinformationinquiry(limitedflexibility)oradhoctoallowthemanagertofollowthedatainanydirectionheorshefindsappropriate.

Copyright A

BPM


226

Aswithmostperformancereporting,managementneedswillvarywiththebusinessoperation’slevelofprocessmanagementandperformancemeasurementmaturity;however,theuseofdashboardstosupportthecollectionandreportingofnear‐real‐timeoperationalinformationwillbecomeanindispensabletoolformeasuringactivityandmanagingthebusinessoperationatboththeworkflowandprocesslevels.

6.4.3 Measuring against KPIs and benchmarks: efficiency

Performanceisallaboutmeetingorexceedingspecificbenchmarks,standards,orKPIs.Thesepresetindicatorsprovideatypeofframeworkfordetermininghowapartoftheworkfloworprocessisperforming,orhowtheworkinawholebusinessunitorprocessisbeingperformed.Earlierinthischapter,wepresentedalistofpossibleareasthatshouldbeconsideredformeasurement.Thatistheeasypart.Figuringouthowtomeasureisthepoliticallychallengingpart.Thehardpart,however,isfiguringoutwhattomeasureagainst—unlessthetargetsaresimplyguessesorhavebeendefinedthroughmanualmeasurementovertime.

Anymeasurementmustbegivencontext;otherwiseitissimplyarawnumber.Thecontextistheevaluationcriteria—theKPI,standard,benchmark,etc.Anymeaningfulcontextcanbeusedinthisevaluation.Itshouldbecompany‐specificorspecifictotheprocessorworkflow.Thekeyindefiningthiscontextisthatitwillneedtoevolveasthecompanyevolvesitscontinuousimprovementprogram.(Atleastonewouldhopethatthingsconstantlyimprove.)Asthishappens,themeasurementcontextshouldbeadjustedtoevertighterspecsorlimits.

Formanycompanies,whohavelimitedperformancemeasurementexperienceorwhowanttotakemeasurementtoanewlevelofmeaning,theselectionoftargetsshouldbeginwithastudyoncurrentmanualmeasurementanditslimitations.Thestudyshouldlookatwhatshouldbemeasuredandthestandards,KPIs,etc.,thatshouldbeputinplacetoevaluateagainst.Aswithallpartsofavalidperformancemeasurementcapability,thecontextlimitsandtargetsshouldbebuiltwiththepeoplewhowillbemeasured,andallrecommendedvaluetargetsshouldbeagreeduponbyboththemanagersthatwillbemeasuredandtheexecutiveteamforthebusinessarea.

6.4.4 Inference engines in performance management

Real‐timeornear‐real‐timeperformancecanbemonitoredusingaBPMS.Thismonitoringprovidesacontinuousstreamofdatafrommultiplesources.Whenthisdataisusedtodrivemeasurement,itwillproduceevent‐relatedorscenario‐relatedresults.Heretheeventorscenarioassociatedwiththedatacanbeeasilylinkedtothedata.Thisallowsthedatatobeviewedautomaticallyagainstpresetfactorsthatdefinethesituation.Withthis,theBPMScanassociaterulestolookatthesituation,lookatthedatavalues,andtheninferaction—orrecommendwhattodo.

Thiscanalsobeusedtohelpdetermineanddirectactioninahighlyvolatile,fastmoving,criticalsituation,orinhighlycomplexsituationstolookatthedataandthe

Copyright A

BPM


227

situationandrecommendactionquickly.Insomecases,theresponsecanbefurtherrefinedthroughmanagementinquiryintotheinferenceenginetoaddinformation.

6.4.5 Trend and other analysis

Trendanalysis,myriadtypesoffinancialanalysis,andotheranalysiscanobviouslybebuiltoncethedataisdefinedandthetechnicalframeworktoaccessitisinplace.Theperformancemeasurementactivityshouldincludetheneedsofexecutiveandothermanagerstolookatperformancefromtheirindividualperspectives.Theseperspectivesshouldbeidentifiedanddefinedbasedonananalysisofthecurrentperformance‐measurementactivitiesandtheiroverlapswiththeanalysisandreportingneedsoftheBPMeffort.Eventually,theperformance‐reportingneedswillbeaddressed,businessareabyareaandprocessbyprocess,toprovideacomprehensiveandflexibleprocess‐managementsupportenvironment.

Tofindthesereportingrequirements,itissuggestedthattheBPMPractitionermeetwiththeITmanagersresponsibleforsupportingthebusinessareasandbusinessintelligencereporting.Thesemeetingswillprovidealistofcurrentreportingneedsandbackloggedreportingrequests.TheBPMPractitionershouldthenmeetwiththebusinessmanagerswhohaveresponsibilityfortheworkinscope(businessandprocessowners)andanyothermanagerswhohaverequestedadditionalordifferentreporting.Thesemeetingswilllookatthecurrentandfuturebusinessevaluationreportingneeds—businessoperationandstrategicimprovement.Trendandothertypesoflong‐termanalyticalneedswillbedefinedinthesemeetings.

Asmanyoftheseperspectivesshouldbebuiltinaspossible,withtheperspective’sinformation‐analysisdefined,dataandsourcesidentified,andoverlapswithotherwork‐managementperformance‐reportingidentified,toproducealistofbothmanagement‐relatedperformancedataandBusinessIntelligencedataneedsalongwiththesourcedatabasesandsystemsforeachdataelement.

Inthisway,theeffortwillbeabletosupportthegreatestrangeofidentifiedperformancereportingneeds.Thiswillimprovethecost/benefitcalculationfortheeffortandforthecompany’smovetoBPMandaBPMS‐supportedBPMoperatingenvironment.

6.4.6 Satisfaction: experience measurement (good and not so good experiences)

Customersatisfactionishardtomeasurebutcritical.Intoday’sageofinstantcommunication,bothpositiveandnegativeexperiencesspreadquicklyallaroundtheworld.Thisdoesinfluencecustomeraction,andcustomersrespondwiththeirpocketbooks—theycansimplygoelsewheretopurchaseaproduct.Asaresult,progressivecompaniesarestartingtomapallcustomer‐interactpointsandfindingwaystoanticipatecustomerinteractionsanddrivecustomerexperiences.Thisisstillfairlynew;whatstartedasanewCustomerRelationshipManagement(CRM)concernwithafewtoolstoscantheinternetandreportonmessagesforreaction‐basedreportingisnowmorphingintoamoreorganized“customerexperience,”

Copyright A

BPM


228

“voiceofthecustomer,”“patientmanagement”etc.concernthatislookingproactivelyatdefiningandmeasuringthetotalcustomerexperience.

Thisconcernistakingonadifferentimportanceascompaniescometounderstandthatthecustomerisinterestedinprice—butnotatacostofgoodserviceandquality.Thisnewunderstandingorreallynewappreciationforthecustomeriscausingcompaniestolookholisticallyatthecustomerandhowtowinhisorherloyalty.Thisincludesrethinkingtheuseofoffshorecallcenters,webportals,customerserviceoperation(thatrequirethestafftolookthroughmultipleapplicationstohandlesimpleproblems—iftheyinfactareeverreallyhandled),andmore.Thegoalistoremoveallobstaclestoagoodinteractionwiththecustomer.Butmeasuringthisishard,sinceitisopinion‐basedandrequiresamorecomplexandcomprehensivelookatthecustomer,theirleveloftechnicalsophistication,theirneedsforsimpleandpredictableactivities(likereturninganitemoradjustinganaccount),andtheiranxieties,inordertoimprovetheexperience.

Thisreportingiscomingandshouldbeconsideredwhenlookingatperformanceandhowitcanbemeasured.

6.5 Finding out how to measure performance

Wehavelookedatwhatcouldbemeasuredandhowtodeterminesourcesofinformation.Itisnowtimetolookathowperformancecanbemeasured.InmanycompaniesthatdonothaveaBPMStohelpdriveperformancemeasurement,theactivitywillneedtobeacombinationofmanualcountingandfeedbackwithinformationthatcanbeobtainedfromlegacyapplications.Thisreportingwillnotsupportreal‐timeornear‐real‐timemonitoringormeasurementthatBPMSofferstodriveoperationalmanagement.Inthemoretraditionalbusinessoperationswithlimitedreportingcapabilities,themovetoperformancereportingwillrelyontheITdepartment’sabilitytodevotethetimeandresourcesneededtocreateacomprehensiveperformancemonitoringandmeasurementcapability.Ifthisisnotavailable,theanalysisanddesignthathavebeendiscussedwillnotprovidetheabilitytocreatethisprogram.

TheremainderofthischapterassumesthataBPMSoperationisinplaceinsome,ifnotallpartsoftheprocess,andthattheBPMpractitionersonanyprojecthavetimelyaccesstoITprogramming,datamanagement,andotherITsupport,aswellastheprioritytohaveworkperformedanddeliveredinatimelymanner.Again,ifthisisnotavailable,itwillbenecessarytoeitherbuildthissupportormodifythescheduletoaccountforminimalITsupport.

Inadditiontotheneedforautomatedsupport,itwillbenecessarytolookatthereportingneedsandtiethembacktotheworkflowinabusinessunitand/orthepointsintheprocesswheretheperformanceinformationcanbemeasured.Individualmonitoring/informationcollectionwilltakeplaceatthesepoints.Thereportingperformedatthesepointswillbedefinedandtheformulaanddatarequiredwillbeidentified.Thisdatacollectionwilldrivereportsatanylevel,wherethedatacanbecombinedtoformabroaderreviewofthebusiness.

Copyright A

BPM


229

MonitoringandmeasurementapproachessuchasSixSigmaandActivityBasedCostingwilldrivethewayactivitiesaremeasuredandthetypeofinformationcollected.Theseapproachescanbeappliedatanylevelofactivitymeasurement—processtoworkflowtotask.

Mostimportantisthattheprocessprofessionalbaseanymonitoringormeasurementonapproachesthatareunderstoodinthecompanyandsupportedbymanagement.

6.5.1 Designing a performance management process

Theperformancemanagementprocessisdesignedaroundtheinformationneedsofdifferentmanagersintheprocessorworkflow,dependingonthelevelofreporting.Itisalsodirectlyrelatedtothecompany’slevelofprocessmanagementmaturity.Onlythosethingsthatareunderstoodandsupportedwithmanagementtechniqueanddataavailabilitycanbemeasured.

Realisticallyassessingtheseabilitiesisthefoundationforbothmonitoringandmeasurement.However,everyonemuststartsomeplace.Itisimportanttorecognizethatcompaniesormanagerswhoarenewtoperformancemeasurementoradvancedmeasurementwillgothroughanevolutionastheylearnwhatispossibleandwhatismostneeded.Oftenthislearningcurvebeginswithalotofunnecessarymonitoringandmeasurement.Thisisevidentovertimebywhatisdiscardedasmanagementfocusesonwhatishelpful.

Thisisimportantinsettingexpectationandindesigningaperformancemeasurementprocessthatismeanttochangeasmanagementlearnsmoreaboutprocessandworkflowperformancemeasurementandwhatinformationandreportingmechanismsareavailable.Inthisjourney,itiscriticalthatanymeasurementandreportingcapabilitybeflexibleandthatnooneexpectsittobeeitheraccurateoroptimallybeneficialtothemfromthestart.Successinthisactivityisthusbasedontrialandimprovementovertime.Thisisimportantinbothexpectationsettingandindefiningthecostsofmakingthistransitiontoperformancemeasurementandevaluation.

Theactualperformancemeasurement/reporting/evaluation/response(performancemanagement)processwillthusbefairlyuniquetoeachprocessandeachworkflow.Thisisnecessarytosupporttheneedsofthemanagementatalllevelsinthebusiness.Followingtheinterviewwithcompanymanagerssuggestedabove,theBPMpractitionerwillneedtocreateaperformancemanagementapproachwithinitialmeasurementpoints/formula/KPIs.ThiswillthenbebuiltintothebusinessoperationusingadditionstotheBPMS‐basedoperatingenvironmentortechnicallinks/interfaces/etc.tothelegacyandnewsupportingapplications.

Usewillshowneededchangesinthemeasurementactivityandbegintheevolution.

Theabilityofthecompanytosupportanyperformancemonitoring/measurement/evaluationwilldirectlydependonitsabilitytoobtaingooddata(near‐real‐time)fromboththeworkfloworprocessflowandthe

Copyright A

BPM


230

legacy/licensedapplicationsthatsupportthebusiness.Insomecases,manualauditingandcountingmaystillbeneeded—especiallyifaBPMSisnotthebaseofthebusinessoperation.Performancereportingmaythusbelimited,anditmaybeamixofautomatedandmanualreports.Again,thisistiedtothecompany’slevelofprocessmanagementmaturityandautomatedapplicationsupport.Itisalsodirectlytiedtotheabilityofthecompanytoobtainandmoveinformationfrommultiplesourcesandthenprovideitinaformthatcanbeusedforevaluation.ThelimitsITcapabilityplacesonperformancemeasurementmustthusbeidentifiedasearlyaspossibleinthecreationofthecompany’sjourneytoperformancemanagement.Thiswillhelpdefinerealityandsettheroadmaptoimprovedmonitoring/measurement/evaluationaspartofacontinuousimprovementprogram.

6.5.2 Determining KPIs and Standards to measure against

Standards,KPIs,andotherperformancetargetswillfirstbesetbasedoncurrenttargets—iftheyexist.Ifthesetargetsdonotexist,thebusinessareas,internalaudit,legal,etc.,shouldbecontactedtolookatneedsandwaystofindtheinitialtargets.Thismayincludeunioncontracts,manualcountsoveragivenstatisticallyrelevanttime,industrymodels,associations,andsoon.

Assumingtheprocessorworkflowmanagershaveperformancetargets,itwillbenecessarytoidentifythereasonsforthesetargets.Ifthemanagercannotdefinethetargetandjustifywhyitisthetarget,thetargetshouldbeputasideuntilamanagercandeterminewhyitisneeded.Newtargetsshouldbeclassifiedas“intrial”andmeasurementagainstthemshouldbetemporary,untilthereportinganditsuseshowthevalueofthemeasurementareaanditsdefinedlimitsortarget.

Itshouldbenotedthatasperformanceimprovementsareimplemented,thetargetvaluesshouldbereviewedandmadetoreflecttheimprovedbusinessoperation.Ifthisisdone,thetargetvalueswillbecometighterastheoperationcontinuestobecomeclosertooptimal.

ThemeasurementareasandtheirKPIs,standards,etc.,shouldallbepartofanevolvingprogramwhereuseandvaluedeterminelongevity.Ifanareaisnotofhighvalue,itshouldeitherbechangedtomakethemeasurementandtargetshighvalueoritshouldbedropped.Thistypeofmonitoringandmeasurementprogramforcesthecontinuingreviewofmeasurementsandtargetsagainstvaluetothecompany.Inthisway,measurementareasandtheirtargetsremainusefulandevolvewiththebusiness.

Thecontinuedevaluationoftheperformancemeasurement“system”(businessactivity,measurementapproach,measurementformula,performancetargets)shouldbeformal,andthereviewofallmeasurementareasandvaluesshouldbemadeinworkshopswhereallmanagerswhousetheperformancereportswillhaveinputintothecontinueduseofthemeasureandchangestotargetvalues.Anychangesshouldbeagreeduponbyallwhousetheinformation.Thisformalchangeprocesswillhelpensurethattherightthingsaremeasuredandthatthe

Copyright A

BPM


231

performancemeasurementprogramdeliverstherightinformation,totherightplace,attherighttime.

6.5.3 Determining measurement approaches and formula

Justasimportantasdeterminingwhattomeasure,whentomeasureit,andwhattoevaluatethemeasurementagainst,istheneedtodeterminehowitwillbemeasured.ThemeasurementmaybesimplemanualcountingdrivenbyaformulathatsaysthecountwillbedividedintogroupsforX,YorZvalueinagivenfield.Itmaybeaneedtoauditthevaluesofevery10thtransaction.Thelistofmeasurementdirections(formulaformeasuring)isendlessandwillbeuniquetoeverycompany,department,processandworkflow.Theformulaitselfwillevolveandisnottheimportanttakeawayfromthissection.What’simportantisthateachmeasurementareaanditsmeasurement(s)bedirectedbyaformal,reviewed,approvedformula.

Withoutthis,theresultsofanymeasurementareopentoquestion,debate,andrejection.Thiscanonlybeavoidedwhenthemeasurementarea,measurementtargets,themeasurementapproachandthemeasurementformulahaveallbeenvettedandformallyapprovedbythosewhowillusethem.

Aswiththeotherareasofperformancemeasurement,theformulasshouldbeconsideredastemporaryandevolveasthebusinessevolves.Thisevolutionshouldbeformalandonlytakeplaceintheperformancemeasurementmanagementworkshops.

6.6. Building a Performance Measurement Capability

Thehardestpartofbuildinganyperformancemeasurementcapabilityispolitics.Fewmanagerswanttobemeasured:resistancewillbehigh,anddisagreementscanbeexpectedoverwhatwillbemeasuredandhow.Caremustbetakenwiththis,becauseitiseasytofindobjections,orformanagerstolacktimeforanytypeofmeasurement.Executivesponsorshipisthuscritical.Itmustbeactive(participateinmeetings,communicatethroughmemos,etc.),itmustbeconstant,anditmustbevisible.Thisisthepartthatdrivesparticipation.

Thesecondbiggesthurdleistheabilityofanycompanytosupportprocessperformancemeasurement.Manycompaniesreallydonotunderstandprocessinthebusinessorproductionpartsofthecompany.Fewcompaniesreallyunderstandalltheirprocesses,howtheyinteractwithoneanother(theinternalandexternalactivities),andhowtheworkthatisdoneisdividedamongbusinessunits.Thisunderstandingisimportantincreatingaperformancemeasurementcapabilitythatprovidesusefulinformation.

Attimesthissecondhurdlebecomesamovementkiller.Expectationsmustnotbesettoolowortoohigh.Theymustberealistic—especiallyincompanieswithanegativeviewofITsupport.IfITcannotorwillnotprovidethelevelofsupportthatisneeded,theeffortwilllosecredibilityanddie.

Copyright A

BPM


232

Fortheseandotherreasons,itisimportanttolookatperformancemeasurementasajourneyandtoplanthatjourney.Itshouldbeorchestratedandmanagedformallybyacommitteeofmanagerswhowillbeaffectedineachprocess.Companiesshouldconsidercreatingaperformancemanagementgovernancegrouptosettheapproachandmonitorthewayperformancemeasurementismanagedbytheprocessmanagementgroups.Thegovernancegroupwouldberesponsiblefordefininghowperformancemeasurementwillbeapproached(especiallyinaBPMS‐supportedbusinessoperation),howitwillbecontrolledforquality,andhowitwillevolve(e.g.,managerworkshopsandformalapproval).ThegroupwillneedtoserveasthecentralinterfacebetweenthebusinessandIT,tohelpwithITplanningandavoidconflictingITinteraction,anditcanalsobepartofaBPMCenterofExcellence(COE).

6.6.1 The role of BPMS technology

BPMS‐basedBPMoperatingbusinessenvironmentswillbeabletoprovideawidevarietyofperformancereportinginformationforbothnear‐real‐timeandafter‐the‐factreporting.However,thisreportingwillneedtobedefinedintheBPMSandallexternalbutlinkedapplications.Thisincludesapplicationsthatlookattheflowofinformation,suchasSixSigmamonitorsandapplicationsthatcount.

6.6.2 Legacy application and business reporting

ItisunlikelythatITgroupswillbepreparedtosupportprocessperformancemeasurementandreporting.Applicationswillgenerallystandaloneforperformancereporting:eventhoughtheyareinterfacedforbusinesssupport,thereportingneedsmayrequireadifferentinterfacing.

6.6.3 Building new reporting is a journey

BecauseitinvolvesworkingtogetherwithIT,legal,finance,executivemanagement,andthemanagersinthebusinessunitsthatsupportworkflow.

Copyright A

BPM


233

Process Performance Management Section II

Introduction

ProcessPerformanceManagementinvolvesbothanunderstandingofwhattomeasureandhowtomeasureit.Thischapteristhusdividedintotwobasicsections—whattomeasureand(basically)howtomeasureperformance.Inthissecondpartofchapter6,wewillfocusonhowperformancecanbemeasuredinaBPM‐basedoperation.

World-class organization

On target with minimum product/service variability

Maximum value generated with minimum use of resources

ProcessPerformanceManagementplaysacriticalroleinaligningtheorganizationalgoalstothevoiceoftheclientthroughstableandpredictableprocesses.Variationinquality,duration,delivery,andcostexistsinallprocesses.Understanding,managing,andgainingcontroloverthevariationarekeystoprovidingworld‐classproductsandservices.ABPMCBOKmustbringtolighttherangeoftechniquesavailabletosupportprocessperformancemanagement.Thischapterwilladdressarepresentativecollectionofsuchtechniques.

6.7 Importance and benefits of performance measurement

Theimportanceofmeasuringtheperformanceofaprocesscannotbeoverstated.ManagementandqualityexpertsfromW.EdwardsDemingtoPeterDruckerhavedeclaredthat“ifyoucannotmeasureit,youcannotmanageit.”Thisstatementholdstrue,andeverybusinessshouldinvesttimeandresourcestoimproveaprocessiftheydon’talreadyknowwhattheyhavetomeasureinordertoimprove.

Measurementsarethebasisfordetectingdeviationsfromacceptableprocessperformanceandresults.Processperformancecanbemeasuredbytheattributesofproductsorservicesthattheprocessproduces,suchasreliability,capacity,exception,responsetime,andservicecomplexity.Processperformancecanalsobemeasuredbytheattributesoftheprocessitself,suchasdefect‐removaleffectiveness,effort,andcycletime.Thesemeasurescanreferencetheactualperformanceoftheprocessandpredictfuturebehaviorandoutput.

Copyright A

BPM


234

Processperformancemanagersshouldfindtherightbalanceforkeyprocessperformanceindicators,whilecontributingtotheenterprise’slong‐termstrategicbusinessplan.Performanceindicatorssuchasclientsatisfaction,turnover,costcontrol,andriskmanagementcanbemonitoredthroughdashboardsbyshowingcurrentvaluescomparedtotargetvalues.

Let’sillustratetheimportanceofperformancemeasurementwithanexample.

Assumethatanorganizationisexperiencingalossinmarketshare.Theircurrentmarketshareis68%,buttheirgoalistohavean80%share.Forsimplification,thisisamatureindustryandtheorganizationanditscompetitorsarenotreallyinterestedinnewproducts,butratherintakingmarketsharefromoneanother.

Marketshareiswhattheorganizationusestomeasureitselfintermsofrevenuegrowth,butasidefrommarketshare,whatisthereason,inprocessterms,whytheorganizationishavingdifficulty?IftheOrderFulfillmentprocessisreviewed,weseethattherehasbeenadropinclientsatisfaction,butwhy?Aftersomeprocessanalysis,itisdiscoveredthatthecurrentordercycletimeis9days.Inotherwords,ittakestheorganization9daystoaccept,commit,order,andthenshiptotheclient.Inacompetitiveglobaleconomyandinthiskindofindustry,thattypeofperformanceisnotacceptable,especiallytothoseclientswhocaneasilygetthesameproductfromacompetitor—hencethedropinmarketshare.

Thenextquestionis,whatiscausingsuchadelayintheordercycletime?Afterfurtheranalysisoftheprocess,itisdiscoveredthatthesalesstaffareenteringintheclientorderslateandtherearealotoferrorsorincompleteformsforclientorders.From1%to10%offormsareincompleteandorderaccuracyisonly83%.Furthermore,salesrepresentativesareenteringtheirordersonceaweekinsteadofonadailybasis.Theexpectedresultsarenotbeingachievedanditisimpactingdifferentlevelsoftheprocess.Moreimportantly,itisimpactingtheclient.

Thisexamplealsoillustratesthatnoteveryoneintheorganizationhasacompletepictureofwhatishappening.TheVicePresidentofMarketingviewsthisissueasamarketshareproblem.TheVicePresidentofSupplyChainviewsthisasanordercycletimeproblem,andfinallytheVicePresidentofSalesviewsthisasanissuewiththeaccuracyandtimelinessofthesalesorderforms.Noneofthemunderstandstheother’sperspective.TheCEOonlyknowsthatrevenueisnotgrowing,soneitherareprofits.Whileeachpersonmayhaveametricforwhichtheyareaccountable,itisunlikelytheyunderstandtheextentofthecross‐functionalprocessthatlinksthemalltogetherfromaprocessperformanceperspective.Whatmakesitworseisthattheyarefunction‐focused,whichmeansthattheywillattackthesymptomsindependently.

Figure48,adaptedfromGearyRummler,illustratesthecross‐functional“OrdertoCash”processfromanenterpriseperspective:

Copyright A

BPM


235

Figure48.Order‐to‐cashprocess(Source:adaptedfromGearyRummler)

Thishappensmoreofteninthoseorganizationsthatputimportanceonprocessandassociatedprocessperformancemetricsratherthanfinancialmetricsalone.

6.8 Key process performance definitions

Measurement,metric,andindicatoraretermsoftenmisinterpretedandmistakenlyusedinterchangeably.

Measurementisdirectlyrelatedtothequantificationofdata(ordataset)inanacceptablestandardandquality(accuracy,completeness,consistency,andtimeliness)

Toillustratethis,take“teninches”asanexampleofmeasurement.Inchesarethestandardand“ten”identifieshowmanymultiplesorfractionsofthestandardarebeingverified.

Copyright A

BPM


236

Metricisaquantitativemeasurethatasystem,component,orprocesshasofagivenattribute.Metricrepresentsanextrapolationoramathematicalcalculationofmeasurementsresultinginaderivedvalue

Forinstance,numberofdefectiveproductsbythetotalnumberofproductsproduced(defectnumber/totalproduction)ortwoerrorsidentifiedbyusersinthefirsteighteenmonthsofactivity(numberoferrors/time).Efficiencyandeffectiveness,however,aregenerallyafunctionofoneormoreofthefourfundamentalmeasurements(time,cost,capacity,andquality),sotheyaremorerelatedtometricsthantomeasures.

Indicatorisarepresentationofameasurementormetricinasimpleorintuitivewaytofacilitateitsinterpretationagainstareferenceorgoal

Anexampleofindicatorwouldbe“greenindicatorisgood,redindicatorisbad.”

Metricscanbeclassifiedintothreecategories:

1. Productmetrics:Describetheproductcharacteristicssuchassize,complexity,designfeatures,performance,andqualitylevel.

2. Processmetrics:Describeprocesscharacteristicssuchascustomersatisfaction,MeanTimeToFailure(MTTF),effectivenessofdefectsremoval.

3. ProjectMetrics:Describeprojectcharacteristicsandexecution.Examplesincluderesourcesallocation,cost,time,andproductivity.

ProcessPerformanceIndicator(PPI)derivesfromprocessgoalsandallowstheprocessownertocontrolprocessperformanceintermsoftime,cost,capacity,andquality.TherearetwelvecharacteristicsofeffectivemanagementthroughPPI:

1. Alignment APPIisalignedwithcorporatestrategiesandobjectives

2. Accountability EveryPPIhasaprocessownerorprocessmanagerwhoisaccountableforitsdefinition,monitoring,andcontrol

3. Predictive PPIcouldeasilyprovideawaytotracepatternsofprocessperformance

4. Actionable PPIsarepopulatedwithtimely,actionabledatasoprocessownersorprocessmanagerscanintervenetoimproveperformanceeffectively

5. Fewinnumber PPIsshouldfocusonselecthigh‐valueinformationor

Copyright A

BPM


237

ontheoveralleffectivenessoftheprocess

6. Easytounderstand

PPIsshouldbestraightforward,notbasedoncomplexmetricsthatmanagersdonotknowhowtoinfluencedirectly

7. Balancedandlinked

PPIsshouldbalanceandreinforceeachother,notcompeteandconfuse

8. Transformative APPIshouldchangethewaytheorganizationevaluatesitself

9. Standardized PPIsaregenerallymoreeffectivewhenbasedonstandardmetricssotheycanbeintegratedacrossdashboards,throughouttheorganization,andusedforbenchmarkingwithinandacrossindustries

10. Context‐driven PPIsputperformanceincontextbyapplyingtargetsandthresholdssoprocessmanagerscangaugetheirprogressovertime.

11. Reinforced TheimpactofPPIsmaybeenhancedbyattachingcompensationorincentivestothem

12. Relevant PPIsmaygraduallylosetheirimpactovertime,sotheymustbereviewedandrefreshedwhennecessary

Table19.Source:www.techrepublic.com(adapted)

Theoverallpurposeofunderstandingprocessperformanceindicatorsistoenablemanagerstocontributetoimprovingorchangingaprocessaspartofprocessperformancemanagement.

Anapplicationencompassingthedefinitionsofmeasurement,metric,andindicatoriswhenprojectscheduleestimationisassessedforaccuracy.TwoimportantmeasurestodeterminetheaccuracyofprojectscheduleestimationareActualProjectDurationandEstimatedProjectDuration.ApplymeasuresbygettingActualProjectDurationandEstimatedProjectDuration.MetriciswhentheScheduleEstimationAccuracy(SEA)iscalculatedbasedontheformulaSEA=ActualProjectDuration/EstimatedProjectDuration.AnIndicatorwouldbearepresentationofSEAinpercentageinsteadofanabsolutenumbersothatinterpretationanddecisionmakingaremadeeasy.SEA=1represents100%accuracyestimation,soSEAindicator=100%.IfSEAisanumberbetween0and1,thenjustrepresentSEAasapercentagetogetSEAindicatorforoverestimation,e.g.,forSEA=0.5,thenSEAindicator=50%(50%accuracy).IfSEAisanumbergreaterthan1,thenraiseSEAtothepower−1(SEA‐1)andmultiplyby‐1togetSEAindicatorforunderestimation,e.g.,forSEA=2,thenSEAindicator=2‐1*‐1(‐50%accuracy).SeeTable20below.

Copyright A

BPM


238

Object Measure 1 Measure 2 Metric Indicator

Project Actual Project Duration

Estimated Project Duration

SEA (Actual / Estimated)

SEA Indicator (±%)

P1 90 days 100 days 0.90 90%

P2 187 days 150 days 1.25 -80%

Pi 450 days 195 days 2.31 -43%

Pn 180 days 180 days 1.00 100%

Table20.MeasurementSample

Allprocessescanhaveameasurementassociatedwiththeworkoroutputoftheprocessthatisperformed.Thesemeasurementsarebasedonfourfundamentaldimensions:time,cost,capacity,andquality.

6.8.1 Time

Timeisassociatedwithprocessduration.CycleTimemeasuresthetimeittakesfromthestartofaprocesstoitscompletionintermsoftheoutput.Examplesoftimedimensionare

DeliveryPerformance,RequestDate OrderFulfillment,LeadTime ProductDevelopment,LeadTime.

6.8.2 Cost

Costisavalue(normallymonetary)associatedwithaprocess.Costcanassumedifferentperspectives;forexample,resourcecostisameasurementofthevalueassociatedwiththeresources(humanornon‐human)requiredtocompleteaprocess,andopportunitycostisthevaluethatislostfromtheprocessbynotgettingtheresultantoutputoftheprocess.Examplesofcostdimensionare

SalesCost ManufacturingCost LogisticsCost InventorySupplyDays

6.8.3 Capacity

Capacityisanamountorvolumeofafeasibleoutputassociatedwithaprocess.Anexamplewouldbethenumberoftransactionsassociatedwithaprocess.Capacityusuallyhasarevenueconnotationassociatedwithit.Ifamanufacturinglinecouldimprovetheyield(reducevariation)oftheline,theninessencethenumberofgoodproductsthatcouldbesoldtoclientswouldincrease,therebyincreasingtherevenuetothemanufacturer.

Copyright A

BPM


239

Capacitycanalsohaveathroughputconnotationassociatedwithit.Anexampleofthiswouldbewhen,inamanualprocess,salesordersaremanuallyenteredintoasoftwareapplicationbysalespeople.Thenumberofsalesordersprocessesperhourwouldbelimitedbythenumberofpeopleandhowmanyorderscouldbeprocessedduringeachhour(preferablywithouterrors).Iforderscouldbeprocessedthroughabrowserinterfacedirectlybytheclientintotheordermanagementsystem,thenthenumberorordersprocessedperhourwouldbelimitedbythenumberofconcurrentclientsonthewebsite.However,itwouldbemoreinquantitythaniforderswereprocessedbyindividualsalespeople.Examplesofcapacitydimensionare

ClientDollarsperOrder(WalletShare) ClientGrowthRate MarketShare

6.8.4 Quality

Qualityisusuallyexpressedasapercentageofactualtooptimalormaximum;inprocessterms,however,itcantakemanyforms.Forexample,variationisaqualitymetricoftheamount,extent,rate,ordegreeofchangeandisgenerallyexpressedasthedifferencebetweentheactualandtargetorexpectedresult.Errorordefectrateisanexampleofvariationinthemetricoferrorsassociatedwiththeoutputofaprocess.Satisfaction,ontheotherhand,isaqualitymeasurementusuallyassociatedwithaservicelevelexpectationonthepartofthecustomer.Examplesofqualitydimensionare

ProductLaunchVariance ForecastAccuracy.

6.9 Monitoring and controlling operations

Notonlyisitimportanttomeasureprocesses,itisevenmoreimportanttocontinuallymeasure,monitor,andcontroltheminordertoachievethedesiredresults.Inthatrespect,basicprocessperformancemanagementismoreofajourneythanadestination.OncetheOrderFulfillmentprocessisdocumentedinitsentiretyandtheinitialprocessmetricsareidentified,collected,andmanaged,theorganizationcanmonitorforchangesthatwillultimatelyimpactthemarketshareoftheirproduct.

“Discoveringthataprocessisoutofcontrolisnotaterribleevent.Itshouldnotbehiddenfromsupervisors,managers,auditors,qualitycontrolexperts,or,mostimportant,customers.Inasense,itisaneventthatshouldbecelebratedbecauseitgivestheprocessowneranopportunitytoimprovetheprocess.”RobertHoyer&WayneEllis,1996

Copyright A

BPM


240

Someaspectsofusingindicatorsmustbetakenintoaccountwhilemonitoringandcontrollingoperations.Itispossibletocreateindicatorsbasedondecision‐makingmodels:

Step1

Definetheproblemtowhichtheindicatorapplies.Managersveryoftenactwithouthavingathoroughunderstandingoftheproblemtobesolved,leadingthemnottosolvetheproblem.ThisisacommonproblemonBSCindicatorsadaptedtoBPMmodels.Managersfrequentlymakemistakesby(a)definingtheproblemintermsofaproposedsolution,(b)failingtonoticeamajorproblem,or(c)diagnosingtheproblembyitssymptoms.Thegoalofgoodindicatorsshouldbetosolveaproblem,nottosimplyeliminateitstemporarysymptoms.

Step2

Identifythecriteriaforindicators;mostdecisionsrequiretheachievementofmorethanonegoal.

Step3

Assessthecriteriaforindicators.Differentcriteriawillhavedifferentimportance.

Step4

Gettoknowaboutrelevantalternatives.Anindicatorshouldgeneratepossiblecoursesofaction.

Copyright A

BPM


241

Table21.Sixstepsindeterminingproblemresponse

Followingthesixstepsinthetableabovecanleaddecisionmakersto(1)definetheproblem,(2)identifyallthecriteria,(3)assessthecriteriaaccordingtotheirpreferences,(4)knowrelevantalternativeactions,(5)evaluateeachalternativebasedoneachcriterionand(6)mapthealternativesaccuratelyandchoosethehighestperceivedvalue.

Whiledeterminingthebestresponsetoaproblem,theteamshouldformallydefinetheconsiderationsthatshouldbeincludedinthedecisionprocess.Thislistofconsiderationsshouldincludetheobviousandrelevant‐but‐not‐so‐obviousfactors.Thislistshouldgrowovertime,withtheadditionofnewconsiderations,andformatypeofdecisionconsiderationstandard.SeeTable22asastartingpoint.

Considerations Howtoavoid

Themoreinformation,thebetter Considerthevitalfewindicatorsandavoidthetrivial

Whatreallycountaremoneyandprofit Considerthatprofitisaresultingindicatordependentontheoverallorganizationalperformance

Theyrelyonlyoncontrollingproductionprocesses

Establishatreeofindicatorssoastoconsidervalue‐addedprocesses

Allrelevantindicatorsshouldbeusedtoevaluateperformance

Checkifanindicator,althoughadequateforaparticularprocess,leadstobehaviorthatunderminesorganizationalstrategy

Table22.Pitfallsinestablishingindicators(source:FNQ)

Step5

Sortouteachcourseofactionbasedoneachcriterion.Howwelleachcourseofactionmeetseachofthedefinedcriteria?Often,thisisthemostdifficultpartbecauseitcommonlyrequiresaforesightintofutureevents.

Step6

Mapthealternativesandchoosethebestoneusingindicators.

Copyright A

BPM


242

Whiletheimportanceofunderstandingtheprocesscannotbeemphasizedenough,monitoringandcontrollingperformanceoftheprocessiswhatmakesthedifferenceinthebusinessenvironment.Asbusinesschanges,sowillthedesiredperformanceoftheprocess.Theprocessitselfwillhavetochangeinordertoachievethedesiredperformance,butthiscannotbeachievedunlesstheprocessandtheperformanceoftheprocessaremonitoredandcontrolled.

6.10 Alignment of business process and enterprise performance

Enterpriseperformanceandcorrespondingmeasurementsarebestexpressedwithrespecttosatisfyingclientneedsandexpectations.TheexamplediscussedinFigure48wascenteredontheOrderFulfillment(OrdertoCash)process;however,allexamplesofenterpriseperformancemetricsareextrapolationsofTime,Cost,CapacityandQualityfoundations.Someexamplesofcross‐functionalprocessesthatdriveenterprise‐levelmetricsare:

OrdertoCash ProcuretoPay CampaigntoQuote PlantoFulfill ManufacturetoDistribution IncidenttoResolution

Thetraditionalapproachconsistsoftranslatingthegoalsintoactionplansforeachmajoroperationalorsupportdepartment.However,thisapproachhasthedisadvantageofproducingfragmentedandpartial(i.e.,relatedtoeachindividualdepartment)plans,leadingtodifficultyinpredictingwhichactionplanwilleventuallybringabouttheexpectedresult.

Itisimportanttonotethatthecross‐functionalprocesseswillimpactmorethanjustoneenterprise‐levelprocess.Forexample,PlantoFulfillwillimpactDeliveryPerformance,RequestDate,andOrderFulfillmentLeadTime.

Whendifferentprocesstransformationmethods(Lean,SixSigma,Reengineering)areused,itisimportanttounderstandwhetherthemethodwilladdressthecross‐functionalprocessorjustasubprocesswithinthecross‐functionalprocessorevenanactivitywithinasubprocess.

InFigure49belowwecanalsoseethatdifferentapproachessuchasBusinessProcessReengineeringandBusinessProcessImprovementapplydifferentlyatdifferentlevelsintheprocess‐to‐taskbreakoutmodel.Thedifferentapproachesthusshouldbealignedtotheneed.Inthemodel,theUnittitleshouldbeanalogoustotheABPMPuseofsubprocess.

Copyright A

BPM


243

Figure49

Althoughthereisnotyetahierarchyofmetricsthatlinksaprocesstoenterprise‐leveloperationalperformance,thereareenoughlinkagesbetweenthecross‐functionalprocessesandenterprise‐levelmetricstogiveBPMpractitionersagoodfoundationtoimprovetherightprocesseswithintheenterprise.

TheBalancedScorecard’sprocessperspectivecreatesastrategicalignmentbylinkinganorganization’sperformanceobjectiveswiththesupportingprocesses.Theobjectivesofreducingcosts,improvingproductivity,developingmarketshare,andmaximizingcustomersatisfactionandprofitabilitycanleadtoidentifyingtheprocessesessentialtotheirachievement.Thus,thedimensionsoftime,cost,capacity,andqualityturnintoindicatorsthatarefullyalignedwithfinancialandcustomerstrategies.

6.11 What to measure

Whattomeasureinprocessperformancemanagementhasbeenamysterytosomeandadilemmaforothers.Thebestwaytounderstandwhattomeasureinaprocessistofirstunderstandtheexpectedresult.

Theinformationrequiredformeasuringthedimensionsofaprocesscanbeobtainedatboththeinputandoutputofthesubprocessaswellasatthebeginningandendoftheoverallprocessforservice‐levelsatisfaction.Metricssuchaserroranddefectratesareexamplesofthesequality‐basedmetrics.

Informationrequiredformeasuringthecostdimensionisusuallybasedontheresourcesneededtoperformtheprocessitself,althoughtheopportunitycostcan

Copyright A

BPM


244

alsocomefromtheoutputinformation.Capacityinformationcomesfromtheoutputinformationoftheprocess.Time‐baseddimensionalmetricinformationisobtainedfromtheentireprocess.

6.11.1 Process Performance Methods

Therearetwoverycommonmechanismsformeasuringaprocess.Thefirstismanual:thatis,collectingdatabyhandandeitherdrawingitonpaperorenteringitintoaspreadsheetormodelingtool.ThesecondisautomationusingleveragingtoolssuchasBusinessProcessManagementSuites,enterprisesoftwaremodelingtools,BusinessActivityMonitors,orsimilartools.Allofthevariousmethodsusedtodayhavesoftwaretoolsassociatedwiththem.

ThereareseveralcommonmethodologiesusedbyBPMpractitionersandonlythreearementionedhere.ValueStreamMapping,Activity‐BasedCosting,andStatisticalProcessControlarethreemethodsformeasuringprocessperformance.Thepurposeofthissectionisnottorecommendoneoveranother,butsimplytopointoutthattherearemethodsthatcanbeusedtomonitorandcontrolprocesses,eachwiththeirowncharacteristicsandpurposes.

6.11.2 Value Stream Mapping

ValueStreamMappingisaLeanmappingtechniqueusedtovisualizethevaluestreamofaprocess.

Bylocatingthevalue‐creatingprocessesnexttooneanotherandbyprocessingoneunitatatime,workflowssmoothlyfromonesteptoanotherandfinallytotheclient.Thischainofvalue‐creatingprocessesiscalledavaluestream.Avaluestreamsimplyconsistsofallthethingsdonetocreatevaluefortheclient.First,followaproduct’sproductionpathfrombeginningtoendanddrawavisualrepresentationofeveryprocessinbothmaterialandinformationflows.Second,drawafuture‐statemapofhowvalueshouldflow.

Belowisadiagram(Figure50)ofthe7wastesidentifiedinLeanValueStreamMapping.

Copyright A

BPM


245

Figure50.The7Wastes,LeanValueStreamMapping

Animportantaspectofprocessperformancemanagementistheconceptofaddingvalue.ThisconcepthasitsrootsinDemingandJuran.Brieflystated,anactivityisvalueaddingwhen

Itisrequiredtogeneratetheoutputrequiredbytheclient. Theclientiswillingtopaytogenerateaprocessoutput. Qualityandconsistencyofthecomponentresourcesoroutputmustbe

maintained. Circumstancesmayimpactprocesscontinuity.

Inservices,additionalvalueoccurswhenitenhancesclientexperienceevenwhenitdoesnotcontributedirectlytothespecificservice,e.g.,thepersonalgreetingandattentionprovidedinahotelfrontdeskisavalueaddedeventhoughitisnotdirectlyrelatedtoprovidingtheroom.Bottomlineisthattheactivitydoessomethingthatisperceivedashavingaddedvaluetotheclient.Understandingwhetheranactivityaddsvalueornotisimportantwhenimprovingaprocessanddecidingwhethertokeeporeliminateaprocessorsubprocess.

6.11.3 Activity‐Based Costing

Activity‐BasedCostingisamethodologythatassignscoststoactivitiesratherthanproductsorservices.

ThereasoningbehindActivity‐BasedCosting(ABC)isthatthereisnoaccountingdistinctionbetweencostsandexpenses:everythingthatisconsumedinan

Overproduction:Producingmorethanisneeded,beforeitisneeded

Transportation:Wastedtimeandefforttomovethingswithinaprocessorbetweenprocesses

Waiting:Non‐worktime,queuetime,waitingforapproval

Inventory:Typifiedbystockormaterialsthatarenotbeingusedintheprocessorcurrentactivity

Motion:Poorplanningandorganizationallayoutoftencausingmotionwaste

Overprocessing:Doingmoreworkthanisnecessarytoaddvaluetothecustomer

Defects:Somethingunacceptablebytheclient,reworkorrepair

The7wastes

Copyright A

BPM


246

organizationisreferredasa“costobject.”Therelationshipsbetweencostobjectsandactivitiesandbetweenactivitiesandresourcesaredefinedascostdrivers(seeFigure51).

Figure51.Costobjectsandactivities

ABCdoesnoteliminateorchangecosts;itprovidesdataabouthowcostsareactuallyconsumedinaprocess.Activitiesconsumeresources.Thisconsumptiondrivescostandeitherefficiencyorinefficiency.Understandingthisrelationshipiscriticaltomanagingoverhead.ABCisusedtodiscoveropportunitiesforcostorefficiencyimprovementandfocusesonoverhead.ABCtraces,ratherthanallocates,eachexpensetoaparticularcostobject.

TheABCmethodmakesindirectexpensesdirect.Itprovidesactivityfrequencyandcostinformationforcomparingactivitiesbeforeandafterprocessimprovement.Itrevealswhatwillhappenifaprojectisnotcarriedout(thedo‐nothingscenario)andwhichprocessesprovidevalue(areneededtoattractandretainclientsorwillresultinoperationalsavings).

ABCisnormallyusedwhenoverheadishigh,costoferrorsishigh,theprocessisshowntobeinefficient,andthecompetitionisstiff.

6.11.4 SPC—Statistical Process Control

StatisticalProcessControldealswiththecollection,classification,analysis,andinterpretationofnumericalfactsordata.Throughtheuseofmathematicaltheoriesofstatistics,statisticalprocesscontrolsimposeorderandregularityonaggregatesofdisparateelements.

Allworkoccursinasystemofinterconnectedprocesses,andvariationexistsinallprocesses.Variationmayoccurasanaturalvariationduetothenatureoftheprocessorvariationduetosomebusinessortechnicalpattern.StatisticalProcessControl(SPC)isusedtounderstandandreduceoreliminatevariabilityinprocessesthatareunstableduetoerrorratesand/orinefficiency.Thisreductioninprocessinstabilitywillimprovetheprocess.SPCfocusesontheX’s(inputs)thatdrivetheY(output),determiningwhichprocessesareprimarilyresponsiblefordrivingtheY’s.SPCthenfocusesonthoseprimarilyresponsibleprocessesforimprovement.

SPCisrecommendedforusewhenhighrateoferrororinconsistencyofoutputsisverified.

Copyright A

BPM


247

6.12 The voice of the process

“Thecontrolchartistheprocesstalkingtous.”IrvingBurr,1953

Processperformancecanbeaffectedbyattributesofcommonentitiessuchaspeople,training,procedures,tools,facilities,material,energy,money,time,policies,goals,constraints,laws,rules,andregulations.

Whenanorganizationcommitsitselftoprovidingproductsorservicestomeetcustomerrequirementsandbusinessgoals,qualitystandard,schedule,andcostmustbecontrollediftheprocessistobeconsideredcapableofprovidingthedesiredoutcome.Bybringingaprocessunderstatisticalprocesscontrolforasufficientperiodoftimetodetectthesourceofdeviation,theerrorsorinefficienciescanbecorrectedandacapableprocesscanbeattained.Therefore,theprocessmustdisplayareasonabledegreeofstatisticalcontroltobeconsideredcapableofachievingthedesiredoutcome.

Variousanalyticalmethodsexisttounderstandandcontrolprocessvariation.Theseinclude

Exploratorydataanalysis Bayesianstatistics Regressionanalysis Discreteeventsimulations Reliabilityanalysistechniques Non‐parametricanalysis Analysisofvariance Controlcharts

Thereisplentyofspecializedliteraturetosupportfurtherreadingoneachoftheabovestatisticalcontrolmethods;however,thecriticalimportanceofcontrolchartsdemandsemphasis.Controlcharts,alsoknownasShewhartcharts,representapowerfulandcommonlyusedtechniquefordeterminingwhenabusinessprocessisinastateofstatisticalcontrol.Therearedifferenttypesofcontrolchartsthatcanbeusedtoplotprocessbehavioranddeterminethevoiceoftheprocess:

Average(X‐bar)andrange(R)charts Average(X‐bar)andstandarddeviation(S)charts Individualsandmovingrange(XmR)charts Individualsandmedianmovingrangecharts Movingaverageandmovingrange(MAMR)charts ccharts ucharts Zcharts

Copyright A

BPM


248

Let’sshowhowanXmRchart(seeTable23)forcontinuousdataworksandhowitcouldbeusedforinvestigatingprocessvariability.Forexample,anoilwellproducescrudeoilyear‐round(24hoursadayby7daysaweekby365daysayear).Everyday,theFieldSupervisorondutyregisterstheextractionofthedayofeachwellinatable.Howcanweconfirmiftheproductionprocesshasbeenstableandrunningcontinuously?Processperformancecanbequantifiedbymeasuringattributesofproductsproducedbytheprocess,soaControlChartcanplotprocessattributesvaluesthathavebeenobservedduringaperiodoftime.

DayCrudeOilExtraction(B/Dx1000)

mR UCL CL LCL

Day1 62 81,5 60,7 40,0

Day2 69 7,0 81,5 60,7 40,0

Day3 51 18,0 81,5 60,7 40,0

Day4 57 6,0 81,5 60,7 40,0

Day5 66 9,0 81,5 60,7 40,0

Day6 60 6,0 81,5 60,7 40,0

Day7 59 1,0 81,5 60,7 40,0

Day8 58 1,0 81,5 60,7 40,0

Day9 62 4,0 81,5 60,7 40,0

Day10 51 11,0 81,5 60,7 40,0

Day11 58 7,0 81,5 60,7 40,0

Day12 69 11,0 81,5 60,7 40,0

Day13 61 8,0 81,5 60,7 40,0

Day14 53 8,0 81,5 60,7 40,0

Day15 39 14,0 81,5 60,7 40,0

Day16 70 31,0 81,5 60,7 40,0

Day17 73 3,0 81,5 60,7 40,0

Day18 59 14,0 81,5 60,7 40,0

Day19 52 7,0 81,5 60,7 40,0

Day20 53 1,0 81,5 60,7 40,0

Day21 67 14,0 81,5 60,7 40,0

Day22 63 4,0 81,5 60,7 40,0

Copyright A

BPM


249

DayCrudeOilExtraction(B/Dx1000)

mR UCL CL LCL

Day23 70 7,0 81,5 60,7 40,0

Day24 61 9,0 81,5 60,7 40,0

Day25 60 1,0 81,5 60,7 40,0

Day26 65 5,0 81,5 60,7 40,0

Day27 71 6,0 81,5 60,7 40,0

Day28 60 11,0 81,5 60,7 40,0

Day29 61 1,0 81,5 60,7 40,0

Day30 62 1,0 81,5 60,7 40,0

Table23.XmRchart

Where:

Item Description Formula

mR Movingrange DifferencebetweendatafordayXanddatafordayX‐1

UCL UpperCentralLine

CL CentralLine Averagenumberofthecollectionofdata

LCL LowerCentralLine

Then:

CL = 60,7

= 7,8

UCL = 81,5

LCL = 40,0

Copyright A

BPM


250

Figure52.Datasummary

Whenthisischarted,itproducesFigure52.

Atleast4effectivetests,calledruntests,canbeusedfordetectingunusualpatternsintheprocessoutcome(seeFigure53):

Test1:Asinglepointfallsoutsidethe3‐sigmacontrollimits(UCL,LCL)

Test2:Atleasttwooutofthreesuccessivevaluesfallonthesamesideof,andmorethantwosigmaunitsawayfrom,theCenterline

Test3:Atleastfouroutoffivesuccessivevaluesfallonthesamesideof,andmorethanonesigmaunitawayfrom,theCenterline

Test4:AtleasteightsuccessivevaluesfallonthesamesideoftheCenterline.

Figure53.Patternsintheprocessmeasurement

Thesetestsassumethatsuccessiveobservedvaluesarestatisticallyindependentsonaturalvariationissymmetricaboutthemean.Inourexampleabove,runtestscan

Copyright A

BPM


251

highlightprocessvariabilityonDay15throughDay17,signalingthatsomethinghappenedtotheprocessthatshouldbeinvestigated.

WalterA.Shewhart(1931)categorizedtwosourcesforprocessvariation:

Common cause variation:Duetonaturalandinherentcharacteristicsoftheprocess,variationoccursrandomlyaroundthemean.Synonymsforcommoncausearenon‐assignablecauseornaturalpatterns.

Assignable cause variation:Duetounexpectedfactorsoroccurrencesthathinderprocessperformanceandaffectprocessoutcome.Avariationoccursfromthemeanorpersistentlyononesideofthemean.Ifitrepresentsaproblem,itshouldbeaddressedandeliminated.SynonymsforAssignablecausearespecialcauseorunnaturalpatterns.Examples:operatorfallsasleep,equipmentmalfunction,powersurges,lackofrawmaterialstoppingproductionlines,workersonstrike,orclimateconditionspreventingworkersfromcarryingonactivities.

[Totalvariation]=[Commoncausevariations]+[Assignablecausevariations]

Assignablecausescanbetransientorpersistent.Transientcausescanbetreatedasarisktotheprocess,andactionsshouldbetakeninordertomitigatetherisk(transientcausesareratherinfrequentandaffecttheprocessinanunexpectedway).Anexampleoftransientcauseistheinabilitytocompleteanactivityduetopoweroutageinanurbanzonewherepoweroutageisrare.Apersistentcause,ontheotherhand,issomethingthathasnotbeentreatedbytheprocessasaninherentpartoftheprocessandthatbecomesafrequentandhighlyexpectedproblem.Someadjustmentsmightbeneededinquantitativepredictivemodelsorprocesscapabilitytoaccountfortheeffectsofpersistentassignablecauses.Theinabilitytocompletetheactivityduetopoweroutageinaremoteandunderdevelopedzonewherepoweroutagesareroutineisanexampleofpersistentcause.

Correctiveactionscanbeperformedtominimizeoreliminateassignablecausesofvariation.Whenallassignablecauseshavebeenremovedandpreventedfromrecurringagain,theequationabovebecomes[Totalvariation]=[Commoncausevariations],resultinginastableandpredictableprocess.Conclusion:Neverstopcontrolcharting.

6.13 Simulation of future state

Thestatisticalprocess‐controlmethodslistedintheprevioussectionarepowerfulwhenusedtomonitorandcontrolprocessperformance.Simulationisthenextstepintermsofdevelopingdesiredfuturestatesofprocessperformanceandidentifyingthegapsincurrentprocessthatpreventtransitiontothedesiredfuturestate.

Thedefinitionofsimulationistheenactmentorrepresentationofthebehaviororcharacteristicsofonesystemthroughtheuseofanothersystem.Inthecaseofbusinessprocesses,simulationisenactingthebehaviorofaprocess,forinstance,by

Copyright A

BPM


252

softwarethathasthecapabilityforsimulation.Inessence,aprocessismodeledinthesoftwarewithalltheassociatedparameters.

Anexampleofthecycle‐timeparametersforeachactivity:

In‐queuetime(beforeworkbegins) Workdelaytime(fromstartofresourceinvolvementuntilstartofwork) Worktime(frombeginningofworktoproductionofoutput) Out‐queuetime(fromproductionofoutputtoreleaseofoutput)

Examplesofthecostparametersare:

Totalstaffingcostsallocatedbyheadcount(labor)includingtheresourcesassociatedwitheachactivityandthecostofeachresource

Materialconsumedeachtimeanactivityisperformed(directcosts) Overheadallocatedtoactivitiesrequiringresourcesincurredoveraninterval

oftime,suchasadministrativecostsallocatedasapercentoflabor(indirectcosts)

Otherconsiderationswithrespecttotheparametersare:

Numberoftimestheprocessrunsperintervaltime(Xtimes/hour/day) Decisionpointsinprocess(example—60/40splitbetweenpathAandpath

B)

Alloftheprocessparametersarefinallyenteredintothemodeledprocess,andsimulationisperformedfirstonthecurrent‐stateprocess.Oncethesimulationiscompleted,anoutputisgeneratedbythesoftwaretoolinatypeofformateasytointerpret.Theoutputshowseachactivitywiththetime‐metricdimensionssummarizedperactivityalongwiththecost‐metricdimensionssummarizedbyactivity.Theoutputofthesimulationallowsidentificationofprocessperformanceproblemareasthataresupportedbyextensivedatafromthesimulation.

Oncethecurrent‐stateperformanceiscompletelyanalyzed,thenthemodelingofthedesiredfuturestateprocessbegins.Oncethefuturestateprocessismodeled,thentheparametersareadjustedtoachievethedesiredprocessperformance,andanothersimulationisrunwithacorrespondingoutputgeneratedforanalysisandinterpretation.

TheBPMpractitionercanthenadjusttheparametersandcontinuerunningsimulationsuntiltheprocessperformsasdesired.Duringthesimulationanalysis,theprocessmodelmaychangewiththeparametersuntilthefinalmodelandparametersaredetermined.ThisisalldoneinthemodelingsoftwarebeforetheBPMpractitionerembarksontheactualprocessimprovementeffortwithateam.Thiscansaveasignificantamountoftime,cost,andeffortbecauseallworkissimulatedinasoftwareenvironmentbeforeitisimplementedintheorganization.

Simulationusingsoftwaretoolsprovidesanexperimentallabforimprovingprocessesbeforeactualimplementation.Itisnotasubstitutefortheactualfieldwork,norisitaperfectmethodfordeterminingthefuturestateprocess.However,

Copyright A

BPM


253

itisapowerfultooltohelptheBPMpractitionermorequicklyassesstheneededcorrectionsthanmanuallytestingthechanges.ThebiggestbenefitofsimulationthroughsoftwaretoolsisthatitwillautomaticallycalculatethebenefitsoftheprocessimprovementacrosstheTime,Cost,Capacity,andQualitydimensions.Simulationbuildsadata‐drivenbusinesscaseforjustifyingprocessimprovement.

Seechapters3(section3.11),5(section5.9),and6(section6.13)forinformationonsimulation.

6.14 Decision support for process owners and managers

Decisionsupportforprocessownersandmanagersisessentialforcontinuouslymonitoringtheactualprocessperformance.Limitedorinaccurateinformationaboutbusinessprocessescanleadtopoordecisionmakingaboutwheretoinvestinandhowtoimproveorganizationperformance.

ManyorganizationsuseadashboardtomonitorprocessperformancebasedontheBalancedScorecard(BSC)framework.ThesedashboardsareaformofdecisionsupportandhavebeenreferredtoasBusinessIntelligence&Analytics.Businessintelligencegenerallydealswithaddressingprocessperformancemanagementwithinanenterprisecontext.Whenbusinessintelligenceisinstitutedatanenterpriselevel,itminesinformationaboutspecificcross‐functionalprocessesandtheperformanceofthoseprocessesinreal‐time,displayingtheinformationinadashboardformat.

Organizationsthatbuildbroadcapabilitiesforenterprise‐levelbusinessanalyticsandintelligenceunderstandthatthecapabilitygoeswellbeyonddataandtechnology:itincludesthecapabilitytoaddresstheprocesses,skills,andculturesoftheirorganizations.2

Thenotionofdecisionsupportactuallybeginswiththeplanningof“when,”“what”and“how”processperformancewillbemonitoredandcontrolled.Forexample,amaintenance‐scheduleplanforamachinecouldincludevalvescleanupevery3,000hours,aconveyorbelttune‐upevery1,000hours,replacementoffiltersevery5,000hours,andsoon.Aclearmaintenanceplaniswellthoughtoutforthemachinebythemanufacturerandputintoanowner’smanual.Theactualfollowingofthemaintenancescheduleislefttotheownerofthemachine.

Processperformancemanagementgenerallybeginswithaplanforwhatprocesseswillbemeasured,howoftentheprocesseswillbemeasured,howdecisionsaboutprocessperformancewillbeaddressedwhenencountered,etc.Decisionsupportframeworks,liketheonesbasedonaBSC,areusefulintheplanningformonitoringofbusinessprocesses.Theyenabletheprocessreviewfortheprocessmanager.Onceaprocessperformanceplanisinplaceandtheorganizationhasidentifiedthecross‐functionalprocessesthatwillbemonitored,thebusinessintelligenceand

2“CompetingonAnalytics:TheNewScienceofWinning,”byThomasH.Davenport;JeanneG.Harris(March2007)

Copyright A

BPM


254

analyticssoftwaretoolsprovideinsightsintotheperformanceofthebusinessprocesses.Therightinformationfromthesetoolssavesalotoftimedetectingprocessperformanceissues.

6.15 Process performance management maturity framework

Dependingonthematurityoftheprocessmanagementintheorganization,processperformancemanagementassumesadifferentdepthandperspective.Capabilitymaturitymodelsdefinematurityinascalefromlevel1to5,where1isthelevelofimmaturityand5isthehighmaturitylevel.Atlevel1nothingisexpectedfromtheorganization,but“justdoit,goanddeliverwhatcustomerwants.”Atlevel2,somecost,time,capacityandqualitymeasurements,metrics,andindicatorsaredefined.Astheorganizationbecomesmoremature,atlevel3theprocessusesend‐to‐endprocessperformancemeasurements,metrics,andindicators,neglectsdepartmentalboundariesandderivesrequirementsfrominternaland/orexternalcustomer.Atlevel4,theprocessperformancemeasurements,metrics,andindicatorsaswellascross‐processperformancemanagementarederivedfromthecompany'sstrategicgoals.Athigh‐maturitylevel5,processperformancemanagementaswellascross‐processperformancemanagementisderivedfrominter‐enterprise'sstrategicgoals.

TheSoftwareEngineeringInstitute’s(SEI)CapabilityMaturityModelIntegration(CMMI®)isareferencemodelthatprovidesbestpracticesforimprovingprocessesforbetterproducts(CMMIforDevelopment[CMMI‐DEV])andforbetterservices(CMMIforServices[CMMI‐SVC]).CMMIincludestwoProcessAreastodealwithProcessPerformanceManagement.Theyare(1)MeasurementandAnalysis(atmaturitylevel2)and(2)OrganizationalProcessPerformance(atmaturitylevel4).

AccordingtotheCMMI,thepurposeoftheMeasurementandAnalysis(MA)ProcessAreais“todevelopandsustainameasurementcapabilityusedtosupportmanagementinformationneeds”3.MASpecificGoals(SG)areratherelementary,sincetheyrepresentthefirststepfromimmaturitytowardhighmaturity.FortheMAProcessArea,CMMIsuggestsspecificgoals,including:SG1—AlignMeasurementandAnalysisActivitiesandSG2—ProvideMeasurementResults.CMMIalsosuggeststhefollowingSpecificPractices(SP)toachievethosegoals:

SG1—AlignMeasurementandAnalysisActivities

SP1.1EstablishMeasurementObjectives

SP1.2SpecifyMeasures

SP1.3SpecifyDataCollectionandStorageProcedure

SP1.4SpecifyAnalysisProcedures

SG2—ProvideMeasurementResults

SP2.1ObtainMeasurementData

3CMMI®forServices,Version1.3,CMU/SEI‐2010‐TR‐034,SEI,CarnegieMellon,November2010

Copyright A

BPM


255

SP2.2AnalyzeMeasurementData

SP2.3StoreDataandResults

SP2.4CommunicateResults

ThepurposeoftheOrganizationalProcessPerformance(OPP)ProcessAreais“toestablishandmaintainaquantitativeunderstandingoftheperformanceoftheorganization’ssetofstandardprocessesinsupportofachievingqualityandprocess‐performanceobjectives,andtoprovideprocess‐performancedata,baselines,andmodels.”OPPhasonlyoneSGtoachieve,namelySG1—EstablishPerformanceBaselinesandModels.Nevertheless,theOPPgoalismorecomplexthanMAgoals.Itislocatedatthehigherorganizationalmaturitylevel4.OPPdemandsthatcertaincapabilitiesarealreadyimplemented,includingMApracticesfromlevel2.CMMIsuggeststhefollowingSpecificPracticestoachievetheOPPgoal:

SG1—EstablishPerformanceBaselinesandModels

SP1.1EstablishQualityandProcessPerformanceObjectives

SP1.2SelectProcesses

SP1.3EstablishProcessPerformanceMeasures

SP1.4AnalyzeProcessPerformanceandEstablishProcessPerformanceBaselines

SP1.5EstablishProcessPerformanceModels

AlongwithSpecificGoalsforbothMAandOPP,therearealsoGenericGoals(GG)tobeachievedthroughGenericPractices(GP).Asaresult,toachieveMAandOPPProcessAreagoals,anorganizationmustalsoimplementthefollowinggenericpractices:

GG2InstitutionalizeaManagedProcess

GP2.1EstablishanOrganizationalPolicy

GP2.2PlantheProcess

GP2.3ProvideResources

GP2.4AssignResponsibility

GP2.5TrainPeople

GP2.6ControlWorkProducts

GP2.7IdentifyandInvolveRelevantStakeholders

GP2.8MonitorandControltheProcess

GP2.9ObjectivelyEvaluateAdherence

GP2.10ReviewStatuswithHigherLevelManagement

GG3InstitutionalizeaDefinedProcess

Copyright A

BPM


256

GP3.1EstablishaDefinedProcess

GP3.2CollectProcessRelatedExperiences

OrganizationalProcessPerformanceoverlapsMeasurementandAnalysisbutwithadifferentfocus.ThegoalofOPPistounderstandtheusefulnessoftheprocessperformancemeasuresintheorganization.ThegoalofMAistointroducethenotionandneedforbasicprocessmeasurementandanalyticpractices;OPPextendstheconceptwithadvancedprocessperformancemanagementpractices.

Processperformancemeasuresarebeneficialwhenthecostofmanagingthemisreasonable.Therefore,notallprocessesaremeasuredandmanagedforperformance.Onlyselected,criticalprocessesaremeasuredandmanagedforperformance.

OPPintroducesfocuson“qualityobjectives,”notonlyon“processperformanceobjectives,”bycoveringproduct/servicequalityalongwithprocessperformance.Thatwillrequireareviewoftheorganization’sbusinessobjectivesforqualityaswell.ModelsforprocessperformancearealsorequiredbyOPPinordertoestimateavalueofaprocessperformancemeasurefromthevaluesofotherprocessmeasures.SystemDynamicsandReliabilityGrowtharebothprocessperformancemodels.OPPreliesheavilyonstatisticalprocesscontroltoachieveperformanceandqualitygoals.

6.16 Considerations for success

Animportantpartofanyprocessperformancemanagementistheorganizationalstructurenecessarytosupportit.Someconsiderationsinclude

Competencymatching:makingsurethatthepeoplewhowillperformprocessperformancemanagementactuallyhavetheskillsetstoachievethedesiredoutcomes

Rolesandresponsibilities:makingsurethatrolesandresponsibilitiesareclearlydefinedandcommunicated

Organizationalstructure:makingsurethattheorganizationalstructureiswellpreparedtoaccommodateprocessperformancemanagement

Empowermentwithaccountability:makingsurethosewhoareempoweredtotransformprocessesareheldaccountablefortheresultsofthetransformation

Processperformanceresults:makingsurethatnotonlyobjectivesaretiedtoroles,butalsoresultsalongwithbehavior‐drivingcompensationandincentives

ProblemAvoidance:makingsureperformancemeasuresareusedintherightwayfortherightreasonandaredesignedtoavoidwhatMichaelHammerdescribesasthe“sevendeadlysinsofmeasurement”inhisbookFASTER,CHEAPERANDBETTER(2010).Inmanycases,thebehaviorsthatthesinsgenerateareareflectionoftheorganization’sculture:

Copyright A

BPM


257

o Vanity:usingmeasuressolelyforthepurposeofmakingtheorganization,itspeople,andespeciallyitsmanagerslookgood.Sincebonusesandrewardsareusuallytiedtoperformancemeasures,executivestendtoexpectfavorablemetrics.Arealisticpictureoftheorganization’sperformancemaysoundmorelikeathreatthananinputforcorrectiveactions

o Provincialism:Functionaldepartmentsdictatingperformancemetricsunderonlywhatitsmanagerscancontrol(departmentalprocessperformancesuperimposingcross‐functionalprocessperformance)

o Narcissism:measuringfromaninside‐outpointofview,ratherthanfromthecustomer’sperspective(outside‐in)

o Laziness:assumingthatitisalreadyknownwhatisimportanttomeasurewithoutgivingitadequatethoughtoreffort

o Pettiness:measuringonlyasmallcomponentofwhatreallymatterso Inanity:implementmetricswithoutgivinganythoughttothe

consequencesofthesemetricsforhumanbehaviorandconsequentlyforenterpriseperformance

o Frivolity:Nottakingmeasurementseriously,arguingaboutmetrics,findingexcusesforpoorperformance,andlookingforwaystoblameothers.

Processperformancemanagementthatfocusesonthebusinessgoalsandfosterstransparencycanprovideahealthyenvironmentinwhichorganizationsprosper.

6.17 Key Concepts

PROCESSPERFORMANCEMANAGEMENT—KeyConcepts

Performancemeasurementisajourney—itmustchangeasthebusinesschanges

Theabilitytosupportprocessperformancemeasurementandthenevaluatetheresultsisrelatedtothelevelofacompany’sprocessmanagementmaturity

Performancemeasurementstartswithperformancemonitoringandtheclearviewofwhatshouldbemonitoredandwhy

Performancemeasurementmustbedrivenbyevaluationtargets—standards,KPIs,costlimits,etc.

Anyperformancemeasurement“system”mustbedefinedthroughaformalworkshopapproachthatismanagedbythemanagerswhowillbemeasuredandusetheinformation

Allchangesshouldbemanagedthroughthisformalworkshopapproach Anyperformancemeasurement“system”willevolve,oritwillbecomeoutof

syncwiththebusinessandhavelittlevalue Measurementisdirectlyrelatedtothequantificationofdata(ordataset)inan

acceptablestandardandquality(accuracy,completeness,consistencyand

Copyright A

BPM


258

PROCESSPERFORMANCEMANAGEMENT—KeyConcepts

timeliness).o Metricnormallyrepresentsanextrapolationormathematicalcalculation

ofmeasurementsresultinginaderivedvalueo Indicatorisasimplerepresentationofameasurementormetric

referencingastatedgoal Measurementassociatedwiththeworkoroutputoftheprocessthatis

performedisbasedonfourfundamentaldimensions:Time,Cost,Capacity,Quality

TherearetwelvecharacteristicsofProcessPerformanceIndicators:Alignment,Accountability,Predictive,Actionable,Fewinnumber,Easytounderstand,Balancedandlinked,Transformative,Standardized,Context‐driven,ReinforcedandRelevant

ValueStreamMapping,Activity‐basedcosting,andStatisticalProcessControlarewidelyaccepted,reliablemeasurementmethods

Whenaprocessisstable,thevariationinprocessperformanceispredictable,sothatunexpectedresultsareextremelyrare.

[Totalvariation]=[Commoncausevariations]+[Assignablecausevariations] World‐classquality=ontargetwithminimumvariability. Aprocessperformancemanagementframeworkbasedonworldwidebest

practices,suchasCMMI,canhelpprocessmanagersstructuretheirprocessperformancemanagementpracticetoconsistentlyachievehighlevelsofmaturity.

Literature References

ABPMPBPMCBOK™,V2.0—GuidetotheBusinessProcessManagementCommonBodyofKnowledge,ABPMPInternational,2009

CMMIforDevelopment,V1.3(CMMI‐DEV,V1.3),SEI,CarnegieMellonUniversity,November2010,TechnicalReportCMU/SEI‐2010‐TR‐033

CMMIforServices,V1.3(CMMI‐SVC,V1.3),SEI,CarnegieMellonUniversity,November2010,TechnicalReportCMU/SEI‐2010‐TR‐034

Cokins,G.“Activity‐basedCostManagement:AnExecutive'sGuide,”Wiley;1stedition,2001

Florac,W.A.&Carleton,A.D.“MeasuringtheSoftwareProcess—StatisticalProcessControlforSoftwareProcessImprovement,”TheSEISeriesinSoftwareEngineering,Addison‐Wesley,1999

Kaplan,R.&Norton,D.“BalancedScorecard:TranslatingStrategyintoAction,”HarvardBusinessSchoolPress;1996

Kan,S.H.“MetricsandModelsinSoftwareQualityEngineering,”2ndedition,Addison‐Wesley,2003

Copyright A

BPM


259

Hammer,M.;Hershman,L.“Faster,cheaperandbetter,”CrownBusiness;1stedition(December28,2010)

Pyzdek,T.“TheSixSigmaHandbook:TheCompleteGuideforGreenbelts,Blackbelts,andManagersatAllLevels,”RevisedandExpandedEdition,2003

Sayer,N.;Williams,B.<http://www.amazon.com/Lean‐Dummies‐Natalie‐J‐Sayer/dp/0470099313/ref=sr_1_1?ie=UTF8&qid=1299363895&sr=8‐1http://www.amazon.com/Lean‐Dummies‐Natalie‐J‐Sayer/dp/0470099313/ref=sr_1_1?ie=UTF8&qid=1299363895&sr=8‐1Lean>,2007

Wheeler,D.J.“UnderstandingVariation—TheKeytoManagingChaos,”2ndedition,SPCPress,2000BusinessProcessManagementOperatingEnvironment.

Copyright A

BPM

P International

Chapter 7

Process Transformation

Copyright A

BPM

P InternationalChapter7.ProcessTransformation

261

Foreword by Tony Benedict, VP Supply Chain, Abrazo Healthcare; President, ABPMP

Companiesineveryindustryareengagedinbusinesstransformation.Someeffortsarebasedontheselectionandimplementationofnewapplicationsystemsandsomearebasedontheuseofnewtechnologyorchangesinbusinessandinoursociety.Ofallthesechangedrivers,probablythemostsignificantisthatourculturesarechangingonagloballevelinresponsetomobilitytechnologyandsocialapplications.Thesearethefoundationforasweepingchangeinthewaywelookatbusiness,success,andcustomers.

Theimpactsofthesechangesarejuststartingtobefelt.Buttheyarecausingmanyprogressivemanagerstoaskatotallynewsetofquestionsabouthowthecompanycanfunctioninternallyandhowitcaninteractwithcustomersandpartnersinarapidlychangingglobalmarketplace.

Successfulprocesstransformationhasproventobebothpervasiveandinvasive.Itforcesmanagementtolookholisticallyatoperationsandasktoughquestions.Italsorequiresmanagerstolookattheanswerstothesequestionsfrommultipleperspectives:process,people,technology,finance,legal,customerandstrategy.Thismulti‐dimensionallookrequiresanabilitytomixperspectivesandbalancethecomponentsofasolution,tocompromiseandyetproduceanoperationallyoptimalsolution.Noteasy,butcritical.

Italsorequirescreatingtransformationteamswithmixedskillsandtheabilitytoworkinanopen,collaborativeenvironmentwherepeopleareencouragedtothinkoutsidetheboxandleveragetheirbackgrounds,disciplines,andcreativity.ThisrepresentsanewapproachformanycompaniesthataresupportedbyBPMStechnologyandtheabilitytosimulateanditeratethatitprovides.

Usingthesedesignanddeploymentsupportcapabilities,companiescanembedperformancemeasurementformulasintheprocessesasrulesorJavamodulesandthengenerateapplications.TheseapplicationscanberuninasimulationmoduleanditerateduntiltheKPIsfortheactionaremet.Becauseiterationcanhappenquickly,theteamcantryideasinsolutionsandseewhathappensinthemodels.Whenoptimal,thesolutionandtheapplicationsthatsupportit(bothgeneratedandbuiltintraditionallanguagesoutsidetheBPMS)canbeeasilymovedintoproduction.Asalways,however,datauseandgraphicalinterfacesneedtobeconsideredandmadepartofthe“live”simulationtests.

ManyofthelegacyandotherconstraintsofthepastarebeingremovedbyadvancesincollaborativeBPMStechnologyanditsadoptioninBPM‐basedapproachestotransformation.So,oldparadigmsneedtochangeandprofessionalprocesstransformationpractitionersmustalsoevolvetheirthinking,skills,methodsandapproaches.

Theapproaches,techniquesandthoughtleadershippresentedinthischapterrepresentthecombinedexperiencesofseveralpractitionerswhoareinthefrontlinesoftheBPMrevolution,workinginavarietyofindustriesandcompanies.

Copyright A

BPM


262

Whenproperlyapplied,theinformationinthischapterhasproventobeeffective.Butsuccessalsorequiresthatcarebetakentobringallaffectedmanagersintoalignmentwiththetransformation’sstrategy,scope,constraints,finances,outcomeobjectives,andmore.Withoutthisalignment,thetransformationisatrisk,assuccesswillbebasedonopinion.Similarly,itisimportantthatcarebetakentoconsiderorganizationdevelopment,talentmanagement,andchangemanagement.Ultimately,peoplewillmakeanytransformationsucceedorfail.Theywillfindwaystogetaroundminorproblemsandtheywillmakethingsworkiftheyhaveboughtintothesolution.

Today,businesstransformation,leveragingemergingtechnologiesandBPMmethodsandtechniques,ispositionedtochangethewaybusinessisconducted.AsBPMpractitioners,weareatthefrontofthisrevolutionandwearepositionedtomakeasignificantdifferenceintheviabilityofthecompaniesweworkfor.

Copyright A

BPM


263

Contents

ForewordbyTonyBenedict,VPSupplyChain,AbrazoHealthcare;President,ABPMP..................................................................................................................................................261

7.0 Introduction..........................................................................................................................265

7.1 Transformation:BeyondImprovement....................................................................265

7.1.1 Whytransform?Whyisn’timprovementenough?......................................267

7.1.2 TransformationandImprovement.....................................................................268

7.1.3 Strategicuseofchange:notashort‐termgain..............................................269

7.1.4 Approachingtransformation:notforthefaintofheart............................271

7.2 ExecutiveCommitment....................................................................................................271

7.2.1 Initforthelonghaul:thisisnotashort‐termcommitment...................272

7.2.2 Whatisneededfromexecutivemanagement?..............................................272

7.2.3 Whatisneededfrombusiness‐unitmanagementinvolvedintheprocess?..........................................................................................................................................273

7.3 Changemanagement:Gettingthestaffbehindtransformation.....................274

7.3.1 WhatisChangeManagement?..............................................................................274

7.3.2 WhyisChangeManagementimportanttotheBPMProfessional?......276

7.3.3 Expectations.................................................................................................................278

7.3.4 PlanningChangeManagementactivities.........................................................279

7.3.5 People..............................................................................................................................280

7.3.6 StakeholderManagement.......................................................................................282

7.3.7 LeadershipInvolvementinchangemanagement........................................285

7.3.8 Vision...............................................................................................................................286

7.3.9 OrganizationDesign..................................................................................................287

7.3.10 OrganizationDevelopment.................................................................................288

7.3.11 Communication........................................................................................................289

7.3.12 Alignment....................................................................................................................290

7.3.13 Support.........................................................................................................................293

7.3.14 PerformanceManagement..................................................................................294

7.3.15 ProcessTransformationandChangeManagement..................................295

7.4 GettingReadyforProcessTransformation.............................................................296

Copyright A

BPM


264

7.4.1 Creatingachange‐readyoperation....................................................................298

7.4.2 Funding:Alwaysaproblem...................................................................................300

7.4.3 Understandingthegoalsofthetransformation............................................300

7.4.4 Theresources:Differentpeoplewithdifferentskills.................................301

7.5 Transformingthebusiness:reachingoptimization.............................................301

7.5.1 CreatingaWin‐Winoutcome................................................................................305

7.5.2 ThestatusofLegacytechnology:helporlimittotransformation........305

7.5.3 BPMSandtransformingthecompany...............................................................306

7.5.4 Redesigningtheoperation:Processlevel,businessunitworkflowlevel,leveragingtechnology..............................................................................................................306

7.5.5 Performancemonitoringandfeedbacktosolveproblems......................307

7.5.6 Deliveringflexibilityandspeedofchange:Arguablymoreimportantthansavings(strategicuseofBPMS/BPMvs.tacticalshort‐termbenefit)......308

7.6 SustainingOptimization...................................................................................................309

7.6.1 Commitmenttocontinuousimprovement......................................................310

7.6.2 Evolvingtheprocess.................................................................................................310

7.6.3 Continuousimprovement.......................................................................................311

7.7 KeyConcepts.........................................................................................................................311

Copyright A

BPM


265

7.0 Introduction

Inthisdiscussion,wewillfollowtheABPMPdefinitionofprocess:

Processesareasetoffunctionsinacertainsequencethatdeliversvaluetoacustomer.Theyarestartedbyclearlydefinedexternalevents.

Theyareformedfromacombinationofalltheactivitiesandsupportthatareneededtoproduceanddeliveranobjective,outcome,productorservice—regardlessofwheretheactivityisperformed.Theseactivitiesareusuallyacross‐functional,crossorganizationaggregationofactivitiesthatworktogethertocreateanendproductorservice.Activitiesareshowninthecontextoftheirrelationshipwithoneanothertoprovideapictureofsequenceandflow.

Processtransformationisthusmuchbroaderthanorganizationandbusinessunitimprovement.Itisalookattheend‐to‐endworkoftheprocessandthewaythatworkwillchange.However,becauseprocessesareacombinationofworkfromseveralbusinessunits,theirworkandworkflowswillbeaffectedandmaybesignificantlychanged.Itisthusappropriateforthemanagersfromallbusinessunitsinvolvedintheworkofaprocesstobeengagedinanytransformationoftheprocess.

Whileitisrecommendedthattransformationbeprocess‐centric,itcanalsobeappliedtoorganization‐relatedgroupsofactivity,function‐basedgroupsofactivities,andothergroupingsofwork.So,whilethediscussioninthischapterwillbeprocess‐centric,othertransformationgroupingsofworkwillbementionedattimes.

7.1 Transformation: Beyond Improvement

Processtransformationisthefundamentalrethinkingofaprocess.Thegoalisinnovationandthecreativeapplicationofnewbusinessapproaches,techniques,technology,andmore.Inthisbusinessredesign,noideaisoffthetable.Nooptionisinitiallyrejected—unlessbycompanypolicy,law,orfinancialreality.Improvementisthusnotthegoal,buttheby‐productofaradicalchangetothewaytheprocessisapproachedandperformed.Thislevelofchangeisbynatureinvasiveandwillbedisruptive.

Itshouldbenotedthatbecauseprocesstransformationiscross‐organizational,thescopewillincludeallthebusinessunitsthatarepartoftheprocess.However,forthosewholookatprocessasbeingtheworkwithinabusinessunit,thediscussioninthischapterwillstillberelevant:transformationcanbeappliedatanylevelinabusinessaslongasitisrelatedtotheradicalrethinkingofhowthebusinessareashouldwork—includingitsmarketsandproducts.

Copyright A

BPM


266

Intransformation,theobjectiveistofindabetterwaytodotheworkoftheprocess.Thatmaymeannewproductionequipment,newapplications,newITinfrastructure,newapproachestobusiness,andnewstaffandstaffskills.Transformation,byitsverynature,ishardtodoandrequiressignificantinvestigationintowhatiscurrentlyavailable(ideas,techniques,concepts,tools,etc.)andresearchintowhatsupport/techniquesarepredictedtobeavailableinthefuture.Itisalsoadeparturefromthecompany’spastapproachesandthinking,andisoftenuncomfortableformanagersandstaff.However,theburdenoftransformationcanbespreadoutandgraduallyimplementedtocontroldisruption,reflectfinancialreality,aligntotheabilityoftheorganizationtoabsorbchange,realignlaborcontracts,andmuchmore.Thesearelimitingfactors—therewillalwaysbefactorslimitingcreativityandinnovation.Theselimitingfactorsmustbeidentifiedatthestartofthetransformationtoavoidreworkandwastedresourceinvestment.

Transformationshouldinvolveseekingideasfrombothinsideandoutsidethecompany.However,itmustbeunderstoodthatwhatworksinonecompanymaynotworkinanother.Thisistrueforideas,resourcelevels,bestpractices,approaches,etc.Allinformationgatheredatthestartofthetransformationmustthusbeanalyzedfor“fit”inyourcompany.Afailuretodothisanalysishascausedagreatdealoftroubleinmanycompaniesastheytrytoemulateanothercompanywithlowercostorsomecharacteristicthatmanagementthinksisbetterthanwhattheyhaveintheircompany.

Thereasonsforthiscautionarevaried,butincludedifferingmanagementcultures,differentITinfrastructuresandcapabilities,differentproductionenvironments,possiblydifferentstate‐levelorinternationalregulations,etc.Soweurgecautionindeterminingthetargetsforthetransformation.

Inaddition,anycompanywillhavetransformationinvestmentandotherrestrictionsthatrequireaphasingofthenewoperation’simplementation.The“bigbang”(all‐at‐once)approachworksinsomecasesandnotinothers.So,theimplementationapproachmustbeknownupfrontsothedesigncanbebrokenintophases—eachofwhichhasagroupofspecificdeliverablesandbenefits.Thisisoftentiedtotheabilitytoinvestinnewtechnology,newproductionequipment,orthetimingofoutsourcing.

Oncethistransformationframeworkisinplace,theprojectcanbegin.

Becausemanycompanieshaveonlyabasicunderstandingofprocess,itwillbenecessarytostartaprocesstransformationwiththeidentificationanddefinitionoftheprocessthatwillbetransformed.Thiswillstartwiththemodelingoftheprocess(high‐levelprocessflowmodel)andidentificationofthebusinessunitsthatwillbeinvolvedinthetransformation.Ifexistingbusinessmodelsexist,theyshouldfirstbereviewedtoseeiftheyarecurrent.Ifnot,theywillneedtobeupdatedorredone.Next,theteamwillneedtodeterminewhatdatatheywillneedasafoundationandseewhatisavailablefromthecurrentbusinessmodels.Together,thesemodelsanddataformthestartingpointforthetransformation.

Copyright A

BPM


267

Inthismodelreview,thetransformationteamshouldidentifythemorevisible,immediateimprovementsandprojectsinordertotakeadvantageofthem,shouldtheybeinitiated.Thiswillprovideimmediatebutshort‐termbenefituntilthetransformationiscompleted.

7.1.1 Why transform? Why isn’t improvement enough?

Formostcompanies,transformationrepresentsacostly,risky,andverydisruptiveoption.Butdependingontheageoftheprocess,itsabilitytoprovideconsistentlyhigh‐qualityresultsatareasonablespeedandcost,itsproductioncapability,itscompetitivenesswiththecompetition,andthecompany’slong‐termstrategy,transformationmaybethebestoption.

Thefactisthatimprovement,whilegood,canonlytakeanycompanysofarinbecomingmorecosteffectiveandcompetitive.Inaddition,formostcompanies,operationalimprovementwillnotproduceanimbleoperationortheabilitytochangequicklywithlowriskandlowcost.

Bydefinition,improvementmakeswhateveryouhavebetter.Itdoesnotrethinkit—itimprovesit.So,ifyouarelookingforwaystodothesamethingsfaster,forlowercost,orwithimprovedquality,youaredoingthesamethings.Atsomepoint,however,theindustrywillhaveevolved.Technologywillhavemovedbeyondyourabilitytosimplyimprovewhatyouhave.Yourcompetitionwillhavebetterwaysandthemarketwillrequirenewapproaches.

Formanycompanies,theresponsetotheseevolutionarychangeshasbeentocobbletogetherasolutionthatallowsthemtocontinuetodobusiness.Thesolutionworks,butnotwellandeveryoneknowsit.Butitwasinexpensiveanddidn’tcausetoomuchdisruptionbecauseitleveragedwhattheyweredoingandaddedtoit.Thissolutioneventuallywillcauseadysfunctionaloperation,and,transformationwillbecomeinevitable.

Forthesereasons,transformationshouldberegardedasastrategicmove.Itisalong‐termcommitmenttothebusinessandtoitsabilitytocompeteintheglobalmarket.Itisalsoacommitmenttomodernize,upgrade,andrethinkhowthebusinessshouldworkinthefuture.

Thegoalsofthetransformationshouldbecarefullyconsideredtoensurethattheytakealonger‐termview.Wehavefoundthatlonger‐termviewsandtheirgoalsareverydifferentfromthegoalsofashort‐termview.Forexample,modernizationhaslittletodowithstaffreduction.Butthathasoftenbeenmixedinwithtransformation.Wehaveseenthatstaffreductionandsimilargoalsofnear‐termthinkingoftenputthetransformationprojectontheroadtodisaster.Peoplewillsimplynotcooperateiftheythinktheirjobortheirfriend’sjobisatrisk.Wheretheseshort‐termgoalsarehidden,peoplewillfigurethemoutandtrustwillbedestroyed.

Transformationgoalsshouldthusfocusonthemodernizationoftheoperation,itsabilitytocompete,andthecustomer.Mostoperationsareoldandcoveredwithchangebandages.Theoperation’sstructuresaregenerallyweakanddon’tfunction

Copyright A

BPM


268

well.“Whitespace”manualworkiseverywhereandapplicationsdon’tsupporttheoperationwell.EvenwherelargeERPsolutionshavebeenusedto“modernize”thebusiness,theareasoutsidethedirectinteractionwiththeERPmodulesareseldomredesigned,andtheERPtransformationbecomesanislandofimprovedoperation.

Thatissimplyfactanditisfoundinanyoperationthathasnotrecentlybeentransformed.Operationsthatweretransformedafewyearsagocanalsobefallingintomediocreperformance—alloperationseventuallyevolveintomediocreperformanceunlessconstantlyimproved.IftheyhavenothadtheadvantageoftrueBPMS‐supportedBPMtoallowthemtochangerapidlyfollowingcontinuousimprovementgoals,theimprovementsmayhavebecomeweakenedbyconstantlow‐levelchangeandmuchofthebenefitmayhavebeenlost.

Modernizationusestheknowledgeofthecurrentoperationasastartingpointandthendefinestheproductsorservicesthatareproducedbytheoperation.Butitmustalsolooktothefutureandprovidetheflexibilitytosupportnewproductsinnewmarkets.Itthenleveragesnewtechnology,newmanufacturingtechniquesandconcepts,andnewmanagementphilosophieswithaclearunderstandingofwhatitwilltaketowininthemarket.Thegoalsofthetransformationshouldthusstartwithamarketplacevisionandthenlookatwhatitwilltaketoaccomplishthatvision.Thesegoalssupersedeallimmediateimprovementgoals.Thisiswhytransformationisstrategicandnotsimplyimprovement‐based.

7.1.2 Transformation and Improvement

Asnoted,transformationinvolvesamuchgreaterchangethanimprovement.Assuch,improvementbecomespartoftransformationandisappliedtoeveryaspectofthetransformationproject.Thetesthereisagainstallproblems,limitations,benchmarks,KPIs,etc.,ofthecurrentprocess.Inanytransformation,theprimarygoalsofflexibilityandcontinuousimprovementwillremainthefocus.Butindeliveringthesegoals,theteamwillneedtotestanysolutionagainstthecurrentperformanceandthefuturetargets.

Forthisreason,thetransformationsolutiondesignmustbeginwithafirmunderstandingofthecurrentoperationanditsmetrics.Theredesignwillthenmovetoadefinitionoflimitations—thatissimplyreality.Nextcomestrategyandthevisionofthefuture.Atthatpoint,theteamwillbereadytostartoverandlookatwhatbusinesscapabilitiesareneededandwhatactivityisneededtosupportthem.

WhilethedebateovertheneedforBPMStechnologyinBPMisstillgoingon,transformation‐levelchangerequirestheorganizationandanalysisofsomuchinformationonthebusiness,itsrules,itsuseofIT,itsproblems,itsuseofoutsourcing,legalrequirementsandmuchmore,thatitsimplybecomestoogreattocontrolmanually—evenwithsupportfromwordprocessors,spreadsheetsetc.Forthisreason,itisrecommendedthataBPMSbeusedtosupporttransformation.Thiswillnotonlyallowcontrolovertheinformationandmodels,itwillalsoprovideanautomatedenvironmentforsolutiondesign,simulation,modification,andthenoperationalevolution.Inaddition,withoutaBPMS‐supportedBPMoperatingenvironment,itisalmostimpossibletochangethebusinessfastenoughtobecome

Copyright A

BPM


269

nimble.Thisinabilitytoprovidefastchangewouldlimitfutureflexibilityandoptions.Seechapter10,BPMTechnology.

TheBPMSenvironmentwillalsoallowthetransformationprocesssolutiontobebrokenintobusinessunitsubprocessesandforthesubprocessestobedesignedforimprovementagainstgoalsorcurrentbenchmarks/KPI/costs/quality.Becausetheactivitiesthatcomprisetheworkinthebusinessunitwillflowwithinthebusinessunitandthenoutsideittootherbusinessunitsintheprocess,thedesignofthisworkflowwillbecomplexandagainrequirethesupportofanautomatedBPMStool—tosavetime,improvethesolution,andallowcontinuousimprovement.

Althoughtheimprovementofactivityineachbusinessunitisimportantinanytransformation,managementofthemovementofworkthroughtheprocessfrombusinessunittobusinessunitiscriticaltotheefficiencyoftheprocessandthequalityoftheprocess’sproductorservice.Thismanagementisakeyfactorinthetransformationredesignandmaybenewtothecompany.Impliedinitisthecooperationofallbusinessunitmanagersinvolvedintheprocessandtheneedforaprocessmanager.

Thisprocessflowisthuscomprisedofindividualbusinessunitworkflowsandprovidesatypeofframeworkfortheirlower‐leveldetail.Mostimportantly,thisflowshowshoweachofthebusinessunit‐levelworkflowsfittogetherandwhatflowsbetweenthem(when,what,why,where).Italsoprovidestherequirementfortheoutputofanyworkflowandshowstheinformation/quality/documentsexpectedbythenextbusinessunitdownstreamintheprocess.Thisallowstheprocessmanagertoanticipatetheimpactofanychangeinabusinessunit’sworkandtomakecertainthatchangesdonotactuallycauseimprovementinoneplaceandharminanother.

7.1.3 Strategic use of change: not a short‐term gain

Asnoted,transformationisreallyastrategic‐levelactivity.Itisanactionthatmusttakealong‐termviewofthebusinessandnotsimplyfocusonshort‐termorimmediateimprovement.Asafoundationtothisview,transformationmusttienotonlytoorganization,butalsotobothcurrentandanticipatedbusinesscapabilitiesasdefinedbyBusinessArchitects.

AccordingtotheBusinessArchitectsAssociation,theroleoftheBusinessArchitectistoalignbusinesscapabilitiesandtheirevolutiontostrategy.Theythendefinehowthebusinessneedstochangeandthetimingofthechanges(seeFigure54).

Thisshowswhatthebusinessneedstodotodeliverstrategicvision,andthewaythecapabilitieswillevolveovertimetosupportthedeliveryofstrategy.Becausebusinesscapabilitiesrelatetobusinessfunction,theytietoprocessthroughsubprocesses(whichcombinetoformfunctions).

Copyright A

BPM


270

Figure54.BusinessCapabilitydecomposition

Businessfunctionsarethusmadeofmultiplesubprocessesandincludepartsfrommultipleprocesses.Aprocess,therefore,willprobablybeinvolvedinsupportingseveralbusinessfunctions.Becauseofthisstructure,decomposingbusinesscapabilitiesalsoprovidesawaytoidentifyhowsubprocessesandthereforeprocesseswillneedtochangetosupportstrategy.Thislinkingofprocesstransformationtobusinesscapabilityandstrategyisoftengiventoolittleattentionintransformation‐projectplanningandexecution.Thisisreflectedinthesolutionanditsabilitytosupportstrategy,evolvingasthestrategyevolves.

ProcessArchitectsnowtakethesechangerequirementsandanalyzetheirimpactonprocesstoconsiderthechangesontheworkinthebusinessunitsintermsofbothperformanceandquality.

Thissetsthefoundationforthetransformation.Atthispointtheprojectmanagerwillbeabletoidentifyhigh‐levelgoalsandhowthebusinessneedstochangetomeetthem.Heorshewillnot,however,knowwhatchangeswillbemadeorthedetails.

Thescopeofthetransformationcanbeanticipated(processesandbusinessunitsthatwillbeinvolved)atthispoint,andremovingthemajorweaknessesinthecurrentoperationcanbealignedwithbenefit.Thiscanbeusedtocreateahigh‐levelvisionorconceptualnewdesign.

Theimpactofthechangeonthecompany’sITandtoproductionorotherequipmentcannowbeestimated.Thisiswhatdeterminescostanddisruption.Addingculturetothemix,wenowhavetheabilitytolookatthecompanyanditspeople’sabilitytoabsorbchange.Thisgivesusafirstdraftofthelimitation,requirements,timeline,anddistributionofchangeandcostoverthetimeline.

Thisisthebasisforaroadmapthatshouldtieoutcomestospecifictimepointsandidentifyhowthoseoutcomeswillbemeasured.Thiswillprovideacleartietotheimpactofastrategyandtherollingbenefitofthestrategyovertime.

Copyright A

BPM


271

7.1.4 Approaching transformation: not for the faint of heart

Businesstransformationisbold,revolutionary,multi‐yearandexpensive.Itrequiresalong‐termcommitmenttooptimizetheoperation.GiventheadvantagesofaBPMS‐supportedBPMoperatingenvironment(seechapter10,BPMTechnology),itshouldalsobeBPMS/BPM‐basedandmovetheoperationintoastateofrapidcontinuousimprovement.Thissetstheoperationonapathofcontinuouschangeasitsustainsoptimization.

Transformationiswithoutdoubtmuchmoreintense,disruptive,andcostlythanimprovement.Giventherisk,cost,disruption,andfear,whygothisfar?Earlierinthechapterwetalkedaboutbenefit,andwhileitisclearlythere,benefitisnottheonlyreason.Asnoted,atsomepointinthelifeofanybusinessoperation,transformationbecomesnecessarytodealwiththebuilt‐upeffectofpiecemealchangesthathavebeenmadeovertime.Whenthispointisreached,theoperationisonitswaytobecomingacompetitiveanchor,whichsimplymustbecomemoreefficientandeffective.Thebusinessmustchangefundamentallytoremaincompetitiveanditmustprovidetheplatformforrapidchange.

Todothis,transformationmustbeinvasiveanditmustbetotallysupportedatalllevelsinthecompany.Becauseitisbothcostlyanddisruptive,itisriskyandscary.Ifdoneright,itgoesfarbeyondimprovementtoafundamentalrethinkingofwhatbusinesstheoperationshouldsupport,howthesupportshouldchange,andhowthebusinessshouldreallyoperate(local,national,international).Thisfundamentalrethinkingtiestovisionandbusiness‐capabilitychangestodeliverthecapability(mustbeabletochangefast)andoperationalchangesthatareneeded.

Unlikeimprovement,whichcanhappeninafocusedwaytosolveaproblem,abroader‐baseduseofBPMtosupporttransformationrequirestheguidanceofapersonwhoisexperiencedinbusinesstransformation‐levelprojects.Thisskillisnotindustry‐specificandnot‐companyspecific.Itis,rather,transformationexperience‐specific.Thisisimportantindeliveringflexibilityandimprovingcontroloverthebusinessoperationwithoutseriousmissteps.

Becauseoftransformation’sscope,impactandrisk,managementshouldlookatcreatingatargetdesignandthenbreakingitintoparts(components)thatcanbeimplementedfollowingaplanthatrecognizestheconstraintsofthecompany.(Seesection7.3.1).Thiscreatesanapproachthatcanbecontrolledanddeliverbenefitonacontinuingbasis.Inthisway,theriskisminimized,thedesigncanchangeasneedschange,costisspreadandrecoveredasnewcomponentsareadded,andpeoplearemuchmoreeasilytrainedandlikelytoacceptthenewoperation.Disruptionisalsominimizedandtheoperation’sculturecanevolveslowlyinsteadofhavingtoabsorbseriouschangeinashorttime.

7.2 Executive Commitment

Becausebusinesstransformationwillchangethefundamentalwaybusinessisapproachedandperformed,itrequiresalong‐termcommitmentbytheexecutivemanagementteam,acommitmentoftime,resources,funding,andpublicbacking.It

Copyright A

BPM


272

mustalsoincludetimefromtheexecutivemanagerstolookatideasandprovideguidanceonhowthenewoperationdesignmustworktosupporttheirstrategy.

Inaddition,therewillbeagreatmanypoliticalproblemsandconflictingprioritiesastheprojectisperformed.Theexecutivesponsormusthavetheauthoritytoresolvetheseconflictsorhaveaccesstothosewhocan.

Transformationwillalsochangethecultureofthebusinessorthepartofthebusinessthatistransformed.Thislevelofchangemustbebackedbymanagementatalllevels—includingtheexecutivelevel,whichwillneedtodefinethenewcultureanddeterminehowtocreateit.

Ifthisinvolvementorothertypesofbackingfail,theprojectwillnotbemorethanpartiallysuccessful.

7.2.1 In it for the long haul: this is not a short‐term commitment

Tomaintainexecutiveinterestandcommitment,itwillbenecessarytotakeanapproachthatimplementsthenewdesigninplannedphases(componentsusingsubprojects)thatbuildononeanothertodeliverthenewoperationwithvisible,tangiblebenefitsandaslittleoperationaldisruptionaspossible.InthisapproachthetransformationwouldcreatethenewdesignandthencoordinatewithITforchangesintheITinfrastructureorapproachestoapplicationsdelivery,interfacing,orwebapplicationsuse.ThiswillallowtheteamtocreateatimelinethattiesthereconstructionofthebusinesstoITchangeand,ifneeded,toproduction‐equipmentchange.Fromthistimeline,theteamcanpredeterminedeliverablesbyestimatedcompletiondateandmakecertaintheyareproducedonafrequentenoughscheduletoensurerollingdeliveryofimprovementandbenefit.Thisapproachismuchmorepalatabletomostexecutivemanagersbecauseitisbasedonanincreasingbenefit.

Italsosetsthestageforalonger‐termtransformationroadmap.Inthiscase,themovetocontinuousimprovementisanextensionoftheroadmap’stimeline,showingtheimplementationoftheperformancemeasurementcapabilities(businessstrategicplanning,anticipatedmarketplacechangeplanning,SixSigmaqualitymeasurement,performancemeasurement,ITinfrastructurechange,etc.)thatwillpointtoimprovementsthatcan—orneedto—bemadetomaintainoptimization.

7.2.2 What is needed from executive management?

Thesimpleanswerisactiveengagement,withvocalcommitmentandfunding.Theharderansweristhe“will”toseethetransformationthrough,givingitahighpriorityandremovingobstaclestoitssuccess.Ifpossible,thisshouldsetthestageforthetransformationtocontinue,evenifseniormanagementchanges.

Partofthiscommitmentisrelatedtodecision‐making.Thetransformationteammustexpectquickdecisionsfromtheexecutivecommittee(CEO,COO,CFO,CIO,andVPHR).Indecisionwillkilltheeffortbyboggingitdown.Thisistrueatalllevels.Butmakingdecisionsthathaveaprofoundimpactonthebusinessisdifficultformanymanagers—especiallythoseinanenvironmentwherethekeyfocusisfinding

Copyright A

BPM


273

someonetoblameinsteadofiteratingproblemdecisionsandimprovingthem.Formanycompanies,thisrepresentsamovetoalearningorganizationthattriesasolutionandthen,ifitdoesn’twork,iteratingitandcorrectinganyproblems.Thisisasignificantculturalchangeformanybusinesses.Itshould,however,beagoalofthetransformation.

Thetransformationteamshouldexpecttheexecutivecommitteetoremoveobstaclestotheirsuccess.Asissuesareraised,itisimportantforcontinuityandmomentumthattheybeaddressedandresolvedinatimelymanner.Thetoughissueswillbebroughttotheproject’sexecutivesponsorand,ifnecessary,totheexecutivecommittee.Theexpectationisthattheobstaclewillberemoved—theissueresolved.Whenthisdoesn’thappen,theestimatesandprojectschedulewillbecomeinaccurateandeventuallymeaningless.

Inanyfundamentalrethinkingofabusinessoperation,manymayreactwithfearandprotectionofthestatusquo.Dealingwiththisisdifficult,butitisalsothemainroleoftheexecutivesponsorandtheexecutivecommittee.Whenfacedwithmajorchanges,itisagoodideatoaddachangemanagementteamwhocandealwiththeday‐to‐dayandprovideproperguidancetotheexecutiveteamintermsofcriticalissuestoaddressandhowtomovetheorganizationalong.Seesection7.3.

Aspartofthefundamentalrethinkingofthebusiness,itisimportantfortheexecutivecommitteetoconsidermanythingsthattheyseldomaddress—includingtheorganizationstructure,compensationsystem,managementevaluationsystemandotherfactorsthatwillinfluencethewaymanagersandstafflookatthetransformation.

7.2.3 What is needed from business‐unit management involved in the process?

Buy‐inisneededfrommid‐levelandlower‐levelmanagers,butitisoftendifficulttoobtain.Experiencehasshownthatmanymanagersandstaffwilllookattransformationasadeclarationthattheyhavefailedandtheiroperationsaresobadthatnothingshortoffundamentalrethinkingcansavethem.Thisispartiallybecauseeverythingmustbequestionedandjustified—includingwhatthemanagersandtheirstaffaredoing,whytheyaredoingit,andhowtheyaredoingit.Thisfearisculturalanditiscommon.Butitcanbeovercomewithseniormanagementinvolvementand,overtime,theproofintheirresponses.

However,evenwithassurancesandproofthroughexamplesthatseniormanagementisnotlookingattheneedtotransformasafailureonanyone’spart,somemid‐levelmanagerswillstillresist.Some,infact,mayfeigninterestandworkbehindthescenestokilltheproject(unfortunately,thisisfairlycommon).Thisiswheretheexecutiveprojectsponsorcomesin.Anyformofpassive‐aggressivebehaviororsabotagecannotbetoleratedandmustbestopped.

Inmostcasesthesefear‐basedbarrierscanbebrokenbyincludingmid‐levelandlinemanagersasactiveparticipantsontheprojectteam—atleastasmuchastheyarewillingtobeinvolved.Thetransformationteamwillbemandatedtodothe

Copyright A

BPM


274

redesign,andthequestioniswilltheydoit“with”themanagersor“to”them.Theanswerisuptothemanagers.

Persistenceandpatiencealsoplayapartinconvertingobstinacyandnegativity.Constantgood‐naturedquestioningforinterpretationanddesignconsiderationoftenbringsrecalcitrantparticipantsaround.Thegoalisforthecompanytowin,themanagertowin,andthepeopletowin.Onlywhenallofthemwininthenewdesignwillthedesignbesuccessful.

7.3 Change management: Getting the staff behind transformation

7.3.1 What is Change Management?

ChangeManagementisatermwidelyusedandattimesconfusingtoBPMandalmosteveryothertypeofteambecauseitcouldrelatetostrategy,technology,ororganization\people.Tohelpsortthisout,belowarethe3mostwidelyacceptedformsofchangemanagement:

StrategicChangeManagement:Thistypeofchangemanagementaddressestheprocessbywhichacompanycanfindnewopportunitiesandnewwaystodefineitselftogeneratemoreprofit.Itfocusesonanalysisofthecurrentperformanceandenvironmentandusuallyleadstoradicalchangeforacompany,suchasabandoningacompletelineofproduct,creatingnewproduct,orenteringnewmarkets.

ITChangeManagement:Thisisthemostpopularandknownformofchangemanagement.ItdescribestheprocessbywhichITprofessionalsmanagethechangetoITapplicationsandinfrastructuretoensureminimumdisruptionofbusinessoperationsandimpactonusers.TheCapabilityMaturityModelandITILareexcellentsourcesofinformationforthoseinterestedinlearningmoreaboutthisformofchangemanagement.

OrganizationalChangeManagement:Thistypeofchangemanagementisneededtoensurethatthetwoprevioustypesarerolledoutproperlyinanorganization.Inthiscontext,itisusedtosupportlargeandsmallerchangeeffortsaswellasincrementalprocessimprovement.ThiskindofChangeManagementisaniterativeprocessthatusesasetoftoolstohelpanorganizationanditspeopletransitionfromacurrentstatetoasustainabledesiredstate.Itdefinestheneedforchange,alignstheorganization,providesforthenecessaryskills&knowledge,focusesontherightobjectives,preparestheorganizationforchangeandmotivatesemployeestoachievesustainableresults.

BecauseBPMtransformationisinvasiveandpervasiveinanybusinessoperationbeingchanged,theuseofChangeManagementtotrulytransformabusinessorspeedupadoptiontomaximizebusinessbenefitsonaprojectinitiativebecomescritical.Peopleultimatelymakeanytransformationorimprovementworkorfailbytheirbuy‐intothefuturestateandadjustmentoftheirbehaviorsinsupportofthenewoperationalmodelandprocesses.Addressingthepeople‐sideofchangebyproperlyapplyingOrganizationalChangeManagementtechniquesisthusessentialtosuccessfultransformation.InBPMS‐basedBPMprojects,theinvolvementof

Copyright A

BPM


275

peoplefromdifferentgroupsformsanopencollaborationthatishighlyrecommended.“Handson”involvementisalsoencouragedduringatleastthedesignandsimulationofthenewprocesses.Thisprovidesachanceforeveryonetolookatthewaytheirjobswillchangeandtocommentonthewaytheycouldbestdotheirwork—theworkflow,theorganizationofthescreens,thescreenlayouts,thedata,theedits,etc.Thisisalevelofinteractionthatisseldomfoundwithtraditionalapproachestoeitherapplications‐developmentorapplicationchange.Thislevelofinvolvementisalsofairlyrareinbusinessredesign,whichoftenhappenswithsignificantmanagementinput,butlimitedstaffinput.

ThisabilitytoinvolvethosewhowillactuallydotheworkisastrengthoftheBPMS‐basedBPMapproach,butitisalsoarisk.Managementandthedesignteammustbeseriousaboutinvolvingpeople.Iftheyarenot,theywillnotpayattentiontocommentsandtheywillcausemoreharmthangood,aspeoplewilllosetrustiftheissuestheyareraisingortheircontributionisnotaddressedinsomeway.

ThroughouttheCBOK,theauthorshavemadereferencetoBPMmaturityandmaturitymodels.WhereyourcompanystandsinitsBPMadoptionandevolutionissomethingyouwillassess,butthemajorityofcompaniesthattheauthorsarefamiliarwitharecurrentlyatthestartoftheirjourney.Atthislevelofmaturity,thefocusisonproblemresolutionandimprovementprojects.Thesetendtobefairlysmall.ButtheyarecriticalindevelopinganunderstandingofthecapabilitiesofBPM‐basedchangeandBPMS‐supportedBPMoperations.ThislevelofinvolvementisalsotheplaceforOrganizationalChangeManagementinacompanytobealignedtothemethods,techniquesandactivitiesinBPMandBPMS‐supportedprojects.MovingfurtheralongthejourneythroughBPMandBPMSuse,theprojectswillbecomelargerandmorecomplex.Heretransformation(notsimplyimprovingtheoperation)startstobecomeafocus.Theassumptionnowmovesfrom“thebusinessoperationisgoodenoughandweonlyneedtoimproveitbytweakingthework”to“arecognitionthatthebusinessoperationneedstoberethoughtandredesigned.”

AtthispointtheBPMProfessionalshouldlookintotheiruseofStrategicChangeManagementtechniquestomakesurethattheobjectivesofthetransformationarebeingwellcommunicated.Onceanewstrategyisdefined,theBPMProfessionalcanensurethatthe‘to‐be’processdesignsupportsthenewdirectionproperlyandtheOrganizationalChangeManagementtechniquesneededtofacilitatethenewprocessdefinition,implementation,andadoptionaredefined,communicated,andinplace.

ToimplementproperChangeManagement,itisessentialthattheprojectleaderdeterminehowthedifferentformsofChangeManagementwillberelevantintheirBPMproject—especiallyifthecompanyisintheearlystagemovingtowardBPMOrganizationalChangeManagement.Atsomepoint,thetransformationwillmovefromtheprocesslevelandbegintobedrivenbybusinessstrategy.AsthishappensashiftfromOrganizationalChangeManagementtoStrategicChangeManagementalsoneedstohappentoensuretherightstrategyispickedinthefirstplace.

IT‐relatedChangeManagementcanbeneededatalllevelsofbusinesschange.ITcancertainlybeaffectedbystrategyanditwillalmostalwaysbeaffectedbybothbroad‐

Copyright A

BPM


276

basedandfocusedtacticalprojects.Itthusneedstobeconsideredinalltypesofbusinesschangework,whenevertechnologychangesareneeded.

WhileallthesetypesofChangeManagementshouldbeconsideredintransformation,wewillfocusthissectiononOrganizationalChangeManagementbecauseitprovidesthetactics,tools,andpracticesneededtosuccessfullyexecuteanyBPM‐basedchangeortransformation.BridgesprovidegreatresourcesaroundStrategicChangeManagement(LeadingTransformation)andCMMandITILhaveextendedresourcesforITChangeManagement,forthoseinterested.

7.3.2 Why is Change Management important to the BPM Professional?

BPMistheharbingerofchange.ChangeisasignificantpartofBPMandaserioussubjecttoanyonewhohopestolimitacceptance‐riskinaproject.BPMaffectspeople’sprofessionallivesbydirectlychangingwhattheydoandhowtheydoit.BPMsolutionsarealmostalwaysbasedontheintroductionofnewpractices,newrules,newtools,andnewrolesandresponsibilities.

ButBPMandBPMS‐supportedBPMarestillintheirinfancyandarenotwellunderstoodinmostorganizations.PeoplefrequentlyhavenoideaofwhattoexpectorhowtheBPMprojectwillbeperformed.Inaddition,BPMisoftenassociatedwithcostcutting,downsizing,andreorganizationofwork—allofwhicharescarytothestaff.So,BPMprojectsoftenneedtostartwith“damagecontrol”topositiontheprojectinapositivemannerThiscanbeagreatchallengeforsomeorganizationsandrequiresconsiderableskillinmanagingchangeandleadingpeopleinahigh‐stresssituation.

BecausenewBPMS‐supportedBPMpracticesmightbeverydifferentfromthetraditionalones,resistancemayoccur—especiallyiftheprojectwasperformedwithminimalstakeholderinvolvement(followingatraditionalapproachofincludingoneortwo“experts”ontheproject).WithoutasolidfoundationofChangeManagementsupport,theconceptofthenewbusinessoperationandthewaytheoperationwillworkmightberesistedandthecompletedsolutionrejectedbytheorganization.

ChangeManagementinBPMcanthusbeusedeithertogainadoptionofBPMasanewdisciplineintheorganization,ortosuccessfullyimplementanewprocessdesignresultingfromaprocessimprovementinitiativeorradicaltransformation.Workingtogether,ChangeManagementandBPMS‐supportedBPMbringthefollowingbenefits:

Lowimpactiterativechangeforimprovementefforts.BPMisdesignedtoiterateandwillallowateamtoevolveasolutionuntilitworksinthewaymanagementandstaffthinkbest.

Improvedpredictabilityonlargetransformationprojects.BPMallowsmanagementaverydifferentviewoftheoperationanditsprocesses;ChangeManagementhelpsanticipateandmitigateacceptanceissues.

Reducedproductivity‐lossthroughrapidredesign,constructionanddeploymentofthesolution.UsingaBPMS,teamshavereuseofmodelsand

Copyright A

BPM


277

informationalongwithacomprehensivepictureoftheoperationandthegenerationofapplications.

Reducedoperationsriskthroughsimulation;improvedtesting. Quickeradoptionandreachingexpectedlevelofperformancesooner.BPM,

byprovidingaplatformforongoinginvolvementoftheteammembers,makesadoptionandlearningfaster.

Notonlydoeschangemanagementhelpengagestaff,thuspromotingacceptanceandsuccessofbothtransformationandimprovement,italsohelpsdrivethesustainabilityofimprovements.Thisisakeypoint!Anychangethatisnotconstantlyreviewedandupdatedwillevolvetoamediocrestatethroughconstantruleinterpretationandmanualwork‐aroundsasthebusinessoperationneedschange.

SustainabilityusingsimulationanditerationisamongthetruebenefitsofBPM—especiallyaBPMS‐supportedBPMoperation.ChangeManagementassistsinsettingthestageforsustainedoperationalchangeby

Buildingacultureofcontinuousimprovement,challengingalllevelsintheorganizationtofindnewwaystoimprovetheworkflowandtasks.

Creatingatrainingprogramthatpromotestakingaviewoftheentiresystem(policy,process,subprocess,organization,workflow,task,workstep,etc.)ofthebusinessoperationthatthemanagersandteamwereinvolvedintransforming.

Creatingacultureofchangebasedonalearningenvironment,wherepeopleevaluatewhattheyaredoing,whattheyhavetried,whatworksandwhatdoesn’t,learnemergingbusinesstechniquesandthenapplythemtoimprovetheworkflow.

Definingtheimpactofthechangeandtheactionsrequiredtosuccessfullymanagetherisksandissuesresultingfromthechange.

Communicatingthechangeanddeterminingappropriatemeanstodevelopownershipandbuildstakeholders’buy‐in.

Developingskillsandprovidingcoachingtosupportusersandmanagersastheyadapttothenewworkingenvironmentandbecomechangeagents.

Anticipatingandidentifyingresistancesandconcerns,interveninginatimelymannertominimizerelatedrisksandbarriers.

Providingsupportandassistancetoensurealignmentofculture,organizationalstructure,people,policy,processes,andsystems.

Monitoringkeymetricstoimplementactionsforcontinualimprovements.

Inthisdayandagewhenchangeisconstant,peoplehaveoftenbeennegativelytaggedasresistanttochange.Actually,peoplearecapableofamazingchange.Thekeyisthewaychangeispresented.Peoplecanwelcomechangeifitisintroducedinwaysthatwillbecompellingtothemindividuallyandfitwithintheircontextualframeofreference—whichisoftendefinedbycurrentculture,immediatesupervisorinfluence,andorganizationalpolicyandprocedures.

Copyright A

BPM


278

Capturingtheheartofanindividualwillnot,however,besufficienttoguaranteeasuccessfultransition.Towinacceptance,itisimportanttoprovideawell‐alignedenvironmentwherethepolicy,process,procedure,tool,people,andincentivesystemallworktogetherasawell‐coordinatedwhole.Inaddition,anunderstandingofhowpeoplerespondtochangeallowsforbetterplanningandthepreventionofresistance.Ingeneral,somepeoplehaveahighertolerancetothedisruptionanduncertaintyofchangethanothers,butallofushavesomecapacity.Ourcapacityismostlybasedonourworkingmemoryandexistingmentalmaps,accordingtoneuroscientists.Anynewinformationcomingourwayistreatedasknownorunknown.The‘known’feelscomfortableandisprocessedasitarrives.Theunknownispushedtoourworkingmemory,tobeprocessedwhenenoughattentionisavailable.

Ifpeopleareaskedtoprocesstoomuchunknowninformationwithouttimeforthemtothinkitthrough,mostwilltendtoslowthingsdownandalmostautomaticallygointoresistancemode—eventhoughtheymaylater,afterenoughtimetothinkabouttheinformation,accepttheproposedinformationandtheresultingsolutionorimplication.Forthisreason,itisimportanttobuildintimeformostofthepeopleinvolvedinaprojecttogainanunderstandingoftheinformationbeingcollectedandtobecomecomfortablewithitsimplications,itsquality,anditsweaknesses.

7.3.3 Expectations

Becauseofthelevelofchangethataccompaniestransformation,peoplemustbepreparedandtheirexpectationsmustbemanaged.Thebeststrategyisthereforetoengagepeopleearly,communicateoften,andinsmallincrements.Thisisatypeofinternalsalesplanforreachingandenergizingthestaff.

BPMallowsmanagementtotakeagradualapproachtochangeanditsacceptanceaspeopleareintroducedtonewideasthroughinvolvementinfindingsolutions.Thepacecanbecontrolledtoallowtheprojectteamandthebusinessmanagersandstafftobeintroducedtoideasinaninformalsettingofteammeetings,workshops,designsessions,and“hallway”discussions.Thisapproachallowstimeforpeopletobecomeusedtoconceptsandinformationbeforetheyneedtoformallydealwiththem.Theproblemthatmustbecloselycontrolledinthisapproachistheeverpresent“rumormill.”However,ifrumoriscontrolled,thisopenandinformal,gradualintroductionhelpsremovethefearofjobloss,statuschange,beingtransferredfromfriends,etc.

Inawell‐plannedandmanagedBPMchangeprogram,thebusinessmanagersandstaffwhowillbeaffected(withintheprojectscope)willbeengagedintheprojectanditschangemanagementactivitiesataveryearlystageintheproject’slifecycle.Thisensuresthattheparticipantsgainanunderstandingofthesignificanceofthechangeandareinvolvedinplanningpropercommunication,training,andotherchangeactivitiesinwaysthatareculturallyacceptable.Throughthisinvolvement,theparticipantscangraduallybecomeinvolvedandunderstandtheprojectanditsgoals.Thesenseofacceptanceandcomfortthisprovidescanbeusedasthemeans

Copyright A

BPM


279

todriveoutfearandresistance.Thisgivesparticipantsanopportunitytoembracethechangesotheycancontributetotheprojectteamandthesolution.

7.3.4 Planning Change Management activities

Figure55.PlanningChangeManagementactivities

IdentifyingtherightChangeManagementactivitiesinsupportofyourtransformationorprojectimprovementinitiativeinvolvesconsiderationofoptionsinavarietyofseparatebutrelatedbusinessareas.TheseareshowninFigure55.Thecoreshowstheinvolvementofpeopleandsponsors.Thisrepresentsboththeprojectandbusinessoperationmanagers/staffparticipants.ThecomponentmodulesintheoutercircledividetheareasthatshouldbeconsideredinaChangeManagementprogramintoseparategroupsofissuesandoptionsforyourinitiative.Intransformation‐levelchange,thisstartswiththedefinitionofclearvisionforthechangethatshouldbealignedwiththecorporatevisionandstrategyandmovestoincludeOrganizationalDesign,OrganizationDevelopment,Communication,Alignment,Support,PerformanceManagement,andProcessTransformation.TheorderofthesecomponentsinthediagrambelowdoesnotindicateanyspecialrelationshiporsequencethattheprojectteamshouldconsiderwhencreatingtheBPMS‐supportedBPMStransformationproject’sChangeManagementplan.Itshouldbenotedthatconsiderationssuchastrainingareembeddedatthenextlevelofdetail.

Figure55isrelatedtochangemanagementandnottoaBPMorProcessmaturitymodeloraBPMS/BPMmethodology.Thediagramrepresentstheactivitiesthatshouldbeconsideredtosupporttransformationandsmallerincremental‐level

Copyright A

BPM


280

change.ThecustomizationoftheactivitiestofitthecompanycultureandtheprojectwillbeimportantinapproachingthetypeandsignificanceofthechangethataBPMTransformationorImprovementinitiativewillbring.

7.3.5 People

Concernforthewaypeoplewilldealwiththelevelofchangeinatransformationshouldbeakeyareaoffocusincreatingachangemanagementplan.Companiesarecomplexsocialorganizationsthatareresponsibleforoperatingthemanualandautomatedsystemsthatcreateproductsand/orservices.Withouttheeffort,contribution,anddedicationofitsworkforceacompanycannotsurvive.However,highlyrepetitiveworkmustbefocusedandcontrolledtoensurequalityandefficiency.Thismixcreatesanoperationthatiscohesiveandeffectiveindeliveringvaluetothecompany(throughprofit)andtothecustomer(throughgoodserviceandhigh‐qualityproducts).Butthestatusquohasusuallybeenbuiltupovertime,andchangingitrepresentsanunknownthatmustbewellfacilitated.Thesimplefactisthatintoday’seconomy,peoplehaveoftenbecomeoverworkedbecauseofdownsizingandacquisition‐relatedlay‐offs.

Thishascausedmanycompaniestolosetouchwiththestaffandmanymanagerstolosethetrustoftheirstaffmembers.TransformationbasedontheinvolvementofthestaffandasoundChangeManagementplancanbegintoaddresstheseissuesandstarttorebuildbridgesthathavebeenburned—unlesstherealgoalisstaffreduction.

Peopleknowledge,skills,andcreativityareofveryhighvaluetoanorganization.Creatingknowledgecostsmoneyandtakestime—sometimesyears.Manycompanieshavefound,totheirdetriment,thatfailingtoconsiderthisvalueinanytransformationandactingaccordinglycanhaveaseriousnegativeimpactontheoperation.Knowledgeofhistory,anunderstandingofrules,familiaritywithapplications,andtheknow‐howtodealwithconstantlychangingproblemsdepartsalongwiththepeoplewhohavetheseassets.Thequestionis“whatisthisknowledgeworth?”

Inassessingriskassociatedwithaplannedchange,itisessentialforthetransformationprojectmanagertounderstandthetypesofknowledgethatthepeoplewhowillbeaffectedmayhave,whichcannotbefoundinotherplacesinthecompany—suchaspolicymanuals,proceduremanuals,etc.(whichareusuallyoutofdate).Inmanycases,theonlyreliablesourceofrules,procedures,andmuchmoreisthepeoplewhodothework.Ifthisisthecase,certaingoalsrelatedtostaffreductionmayneedtobereconsidered.

Inaddition,thetransformationprojectmanagershouldlookatwhypeopleresistchangeandtakestepstomitigatethisresistance.Thiswillprovideaframeworkforplanninghowtheymayovercomethisresistance—bothduringthetransformationprojectandlaterinthecontinuingimprovementphaseoftheBPMprojectlifecycle.

Accordingto“TheNewScienceofChange,”anarticlepublishedinCIOMagazine(Sept.2006),

Copyright A

BPM


281

20%to30%ofpeoplearechangeseekers

20%to30%ofpeopleseechangeasathreat

50%to70%ofpeopleareskeptics.

Identifyingwhichcategorythekeytransformationstakeholdersbelonginistoughbecausethetruefeelingsofpeopleareoftenhidden.However,categorizingthemainprojectparticipants(changeseekers,thosewhoarethreatened,orskeptics)isimportantinplanninghowtoapproachthechangewiththem.Also,astheprojectteambecomesmorefamiliarwiththekeystakeholdersandviceversa,opinionsandpeople’sclassificationwillchange.Thismakesthestrategyindealingwiththekeystakeholdersveryfluidanditerative.

Theprojectteammustkeepinmindthekeystakeholders’motivationsandconcerns:whatisinthechangeforthem?Sometimesahiddenagendamightbeatplay;thepossibilityshouldbeconsideredandstepsshouldbetakentofindtherealmotivatorsandfears.Thisisnotalwayseasytodo.Somepeoplewillsaytheysupportthechange,yetdoeverythingtheycantostopitormakeitfail.Thiscanonlyreallybeidentifiedbylookingobjectivelyatwhatpeoplearedoing—notjustatwhattheyaresaying.Theprojectmanagersmustusediscretionandunderstandingwhenaddressingtheserealobstacles,buttheymustbeaddressedandremoved.

Inlookingatchangeresistance,itisimportanttoconsiderthereasonsforchangeandworkwiththepeopleaffectedtoaddresstheirconcernsandfears,andtohelpthemmovealongwiththeteam,keepinganopen,collaborativeenvironment.ThemostfrequentconcernsobservedonBPMprojectsinclude

Lossofpowerandcontrol Overloadwithcurrentresponsibilities Lackofawarenessoftheneedforchange Uncertaintyaboutpossessingrequiredskillsforfuturestate Fear,uncertaintyanddoubt Distrustofthegoalsofchange(lay‐offsannouncedorfearofchange) Comfortwithcurrentstate Beliefthatitwillrequiredoingmorewithless,orforthesamepay Beliefthatitwon’tdoanythingforthempersonally Perceptionofitasextraworkthatwillprobablynotbeimplemented Fearthatthenewwaywillbemoreworkandthattheywillfail.

BPMS‐supportedBPMhelpsaddresssomeoftheseconcernsbysupportingvisualmapping,simulation,anditeration.Theapproachsuggestedinthischapterisalsopartofreducingtheseconcernsandtheriskofresistance.Involvingagreatmanyofthestaffforshortperiodsandaskingfortheiropinionsisconsideredbysomeofthemoretraditionalprojectmanagerstobeunnecessary.Wedisagree.Experiencehasproventhatexternalexpertise(“wedon’tneedtotalktoanyonebecausewearetheexperts”)ortheinvolvementofoneortwobusiness‐areaexpertsisnotenoughtoovercometheseconcerns.Onlybyinvolvingmanyofthepeoplecantheseconcerns

Copyright A

BPM


282

beovercome.Involvingthekeystakeholdersearlyandcommunicatingofteninsmallincrementsisakeysuccessfactorinanysignificantchangeinitiative.

Duringtheproject,communicationwithallstaffandmanagementlevelswillthusbeimportant.Intheseinteractions/discussions,attentionshouldbepaidtothetoneandcontentofthemessage.Thewayengagementandchangecommunicationsanddiscussionsarewordedwilleitherhelpcontrolfear,orcauseit.Ifachangeissignificantforanindividual,theindividualwillmostlikelyfollowsomestagesofthegrievingcycleasdescribedbyKennethBlanchardinWHOMOVEDMYCHEESE?Thestagesaredenial,anger,bargaining,depression,andacceptance.

Itisimportanttorecognizethiscycleinanysignificantchange.Peoplewillbecomfortablewithwhattheyknow,andhowtheyhavedonethings.Theunknownisdistrustedandfeared.Anyabruptchange(happenswithouttherightsetuportheirinvolvement)causespersonalinsecuritiesandgeneratesfeelingsofanxiety,aspeoplefeelthatthechangeisneededbecausetheyaresomehowatfaultorthattheyareviewedashavingfailed.

However,asnotedabove,followinganapproachthatinvolvesthekeystakeholderscansignificantlyimpactthisnormalreactiontochangethatisforceduponthegroup.BPM‐basedtransformationcanbeapproachedinonlytwoways—itcanbeusedtodoittothestaff(imposethechange)oritcanbeusedtodoitwiththestaff.

Whilethereareshadesofthesetwoapproaches,thesearetheonlytwooptions.However,whenthestaffisnotactivelyinvolvedinthechange(the‘doittothestaff’option),managementbuildsdistrust,resentment,and—often—activeresistance.Theseprojectstakelongeranddeliverquestionableresults.Ontheotherhand,experiencehasproventhatdesigningandbuildingthechangewithkeystakeholdersandsignificantstaffinvolvementislessriskyandbetteraccepted.

Forthisreasonitisrecommendedthatanychangebeapproachedwiththefullinvolvementofthestaffandmanagerswhowillbeaffected.

Ifthisbroadinvolvementapproachisnotacceptableinagivencompanyculture,theprojectteamwillneedtobuildremediationstepsintotheprojectplan.Resistancetochangeandthegrievingcyclethatcanbeassociatedwithitareanormalpartofchange.Thebestwaytoaddressthesefactorsistoanticipate,monitor,andmanagethemasspecifictasksintheprojectplan.ThiswillalsorequiretheinvolvementofhumanresourceexpertsanditwillbeimportanttohavetheHRexpertsinvolvedinthesetasks.

7.3.6 Stakeholder Management

Theprojectsponsoristhemainstakeholder,butnottheonlyoneinaBPMtransformationorimprovementproject.ClearlyallbusinessandITmanagerswhowillbepartoftheprojectsarekeystakeholders;soarefinance(SOX,DoddFrank)andlegal,soaretheemployees(HR/unioncontracts)etc.Butregardlessofhowstakeholderisdefined,anextendedgroupofaffectedbusinessmanagersfromrelatedprocessesor,ifthewholeprocessisnotinscope,managersfrom

Copyright A

BPM


283

downstreamofthetransformedbusinessoperationshouldalsobeconsideredinmanagingthechange.

Thisiscriticalbecausetheywillhaveanabilitytoclaimthatthechangesdisruptedtheirareaandcausedharm,sotheymustbeinvolved.

Inaddition,youmightalsowanttoconsiderpeopleresponsibleforupstreamprocess,ifyouwouldliketomodifyanyoftheinputyouarereceivingfortheprocessyouarecurrentlyimproving.Ifthesebusinessareasarenotinthescopeoftheproject,anychangestowhattheymaydelivertothebusinessactivitiesinscopewillneedtobeconsideredasscopechanges,andmayormaynotbeallowed.

Inanymajoreffortoranyeffortthatisconsideredcritical,itisasimportanttoknowwhodisagreeswiththeproject’sscope,approach,deliverables,etc.,asitistoknowwhobacksanypartofatransformationeffort.Thisevaluationofparticipantsisdifficultbecauseofhiddenagendas,butitisimportantthatitbeconsideredandthenpossiblyevolvedasmoreislearnedbytheprojectsponsorandmanager.

UsingBPM,possiblechangestothebusinessoperationwillbeidentifiedafteraninitialfact‐findingstudy—theanalysisofthe“AsIs”modelwithsupportinginformation.Thisiswherethosewhomaysaytheysupporttheproject,butreallyresist,willbeidentified.

Althoughtheresistancemaybesubtle(missedmeetings,slowdecisions,frequentdecisionchanges,etc.)itcanbefoundiftheprojectmanagerlooksforpatternsofactivity.Asthenewdesignisbeingbuiltandsimulated,theprojectteamwillhaveanotheropportunitytodeterminerealsupportthroughaction.Disagreementisnotinitselfanindicationofresistance—unlessnothingprovestobeacceptable.Disagreement,whenconstructive,isactuallyasignofparticipationandcommitmenttotheresultoftheproject.

However,forthosewhotrulyactasroadblockstosuccess,mitigationstepsmustbedesignedwiththeprojectsponsorand,ifnecessary,discussedwithexecutivemanagement.Ifthiscannotbeturnedaround,theprojectmayneedtobeadjustedandanewscopeordeliverabledefined.Inthisway,eveniftherearesomewhowillnotreallybacktheproject(withtime,priority,accesstostaffordata,signoff,etc.),theprojectwillcontinue.However,executivemanagementmustbeawareofthesituationandexpectationssettoreflectpoliticalandculturalreality.

Inadditiontopolitical‐andculture‐basedresistance,wehavefoundthatoncethepossiblesolutionsarediscussed,operationalsuccess‐relatedoppositioncanalsobuildduetovalidissueswithotheraspectsoftheorganization.Frequentreasonsforthissuccess‐relatedoppositionare:

Proposedprocessdoesnotalignwithcurrentperformanceevaluationandrewardsystems

Proposedprocessisnotsupportedbythecurrentstafflevelandskills Proposedprocessdoesnotalignwithchangingpriorities.

Oncefound,thesereasonsforresistancemustbeaddressedasquicklyaspossible.Anyresolutionoftheunderlyingcausesofresistancemustthenbetakeninto

Copyright A

BPM


284

accountinthepossibleprocessredesign(solution).Afocusonkeystakeholdersandtheirconcernsthroughoutthissolutionvalidationwillhelptoensureaprocessdesignsuitedtobothitsenvironmentandtherealneedsofthestakeholdersandtheirmanagers.

Asnoted,stakeholdersmaybeanypersonorgroupwhocouldimpacttheprojectorbeimpactedbytheproject.Thelistofstakeholdersforatransformationprojectcanthusbelong—thebiggerthetransformation,thebiggerthestakeholderslist.Luckily,notalltheplayersinanorganizationhavethesamelevelofinfluencerelatedtoaspecificchangeinatransformation.Tomakesureyoumakethemostoftheproject‐team’stime,theBPMtransformationprojectmanagerneedstofocusoninvolvingthose‘key’stakeholdersthathavethehighestpotentialtomakeorbreakthechange.Successisdifficultifsomeofthetransformationparticipantsarenotinagreementwiththeapproach,theplan,thetask,thewayperformanceismeasured,etc.,soitisimportanttoidentify‘key’stakeholdersandinvolvethem,spendingtimetoaddressanyconcerns,negotiateissuesandaddressalldisagreements.

Thesestakeholdersmustbecometheproject’spromoterstothekeybusinessmanagers(processownersordepartmentmanagers).Theymustvocallysupporttheprojectandthenewdesign.Thisiscritical.Ifanykeybusinessmanagersturnagainsttheproject,itwillfail.

Asnotedabove,theprojectmanagerwillneedtoidentify,bykeystakeholder,whatisimportant(tothem)andfindawaytodeliverthattothemasthenewdesignisbuilt.Butthatisonlyastartincontrollingchange.Experiencehasshownthatchangemustbesoldatthepersonalleveltobeaccepted.Managerswillneedtobecomecomfortablewiththeideathatriskisbeingmanaged,creativesolutionsarebeingfound,andthattheoperation’sperformancemeasurementapproachwillbealignedtothenewoperation.Thiscomfortisthefoundationforacceptance,atrustthatthesolutionswillnotcausethemharm.

Also,theprojectteamwillneedtoconsiderthefactthateveryorganizationcanabsorbdifferentamountsofchange.Therewillbelimitsrelatedtoculture,trust,workload,etc.Forthisreason,eachoperation’sabilitytoabsorbchangemustbeassessedandthedesignandimplementationplanmustbeadjustedtodeliverthechangeinphasesorstepsthataligntotherateandamountofchangethatcanbeintegratedintothegroup.

Theapproachtomanagingtheproject’schangerequirementwillbeiterativeandwillchangeastheprojectisperformed,basedoncontinuedinteractionandtheprojectmanager’sassessment.Byanalyzingtheresultoftheassessment,theprojectmanagercanprioritizethekeystakeholdersanddevelopachangeplanthatwilltakethemtothedesiredlevelofacceptance.Inthisanalysisofchangeacceptance,specialattentionmustbedevotedtoinfluentialstakeholdersthathavelowlevelofacceptance.Thesepeoplecouldhaveconsiderablenegativeinfluenceonacceptanceofthechangeintheorganization,andspecialized,flexiblemitigationplanswillneedtobecreatedandthenmodifiedasneededduringtheprojectlifecycletogainandkeeptheirbacking.

Copyright A

BPM


285

7.3.7 Leadership Involvement in change management

BPMS‐supportedBPMisstillnew,andwhenusedtosupportbusinesstransformationitrequiresatleasttraininginthebasicsofBPM,anoverviewofBPMSandBPMmethodologies,andbasictrainingintheuseoftheBPMS.Inaddition,changemanagementwilltakeonadifferentemphasisthroughenhancedbusiness‐staffinvolvementintheprojectandinmovingtocontinuousimprovement.Thischangeintransformation‐projectapproachwillrequireacommitmenttotraining,andobtainingexperiencedtransformationexpertstoactasmentors.DevelopingtheleadershipofanorganizationtobettermanagethisBPM‐basedchangewillmakeamajordifferenceinthespeedatwhichanorganizationadaptstobothtransformationandcontinuousimprovementchange.Thiscommitmenttodevelopingtheneededskillsisalsoatestofmanagement’scommitmenttothetransformation.

Theseandothercollaboration‐relatedBPMandBPMStechniquesandtaskswillrequirearethinkingofthecompany’sapproachtochangemanagement.Transformationfearmustbeaddressedandmitigated.Ifthislevelofchangemanagementisnotaddressedinyourcurrentchange‐managementstandardsandtechniques,itwillbenecessarytoworkwithHRandITtomakecertaintheproperstepsaretaken,giventhecompany’sculture.

Aswithalltypesofprojects,anyprojectthatmaychangeculturemustbecloselymonitoredbycompanyleadership.Executive,mid‐level,andlinemanagersmustallagreewiththewaytheculturewillchangeandwhatnewculturewillbebuilt.Withoutthisbackingandactiveinvolvement,theculturewillnotchangeandattemptstodosowillcauseseriousstaffproblems.

Leadershipmustthusbeinvolvedinallaspectsofdefiningthenewcultureandincontrollingthechangesthatwillproduceit.Theymustalsomonitortheevolutionofthecultureandthebusinessoperationtomakecertainthatthestaff’sconceptsandattitudesarechangingandthatthenewwaysarebeingadopted.Fromthismonitoring,theywillbeabletoapplytherightpressureattherighttimestoprovetheirbackingandthuspromotetheevolution.

Finally,withallthedownsizingandrightsizingthathasoccurred,manyorganizationsareoperatingunder‐staffedandhavetheirmid‐levelmanagersfocusedondailyactivitiesandroutineinsteadofleadingandinspiringtheirteam.Inthesecases,wehaveseenahigherlevelofchangesuccesswhentimeistakentotrainorre‐engagethemid‐levelmanagement’sleadershipskills.Essentialskillsforthemid‐managerinleadingtransformationcomprisecommunication,engagement,collaboration,andempowerment.ExperiencehasshownthatBPMtransformationshaveagreaterchanceofsuccesswhenmanagerspayattentiontotheirpeopleandtheirconcerns,promotecollaborationamongstleadershiplevels,andfocusonstaffgrowthandbuildingimprovedcapabilities.Thesearecriticalelementsofanysuccessfultransformation;failingtogivethemtheattentiontheyneedincreasesriskandbuildsstaffdistrust.

Copyright A

BPM


286

7.3.8 Vision

Anytransformationshouldbealignedwithcompanyvision,mission,andgoals.Goingfurther,managementshouldalsohaveaclearseparatevisionforthetransformationproject—whatthenewbusinessoperationwilllooklikeandhowitwillperform.ThisvisionofthenewbusinesswillincludetheuseofaBPMSandBPMtodeliverthetransformedbusinessandcontinuousimprovement,clearmetric‐basedperformancegoals,anddefinableoperationalcharacteristics.Thisvisionwillalsoincludetheorganizationstructureneededtogovernworkandthecapabilitiesofthestaff.Insomecases,thisvisionwillalsobegintomovethebusinesstowardaprocess‐viewoftheoperationandtheuseofperformancemeasurementandanalysistomovetocontinuousimprovement.OntheITside,thisvisionmayalsoincludeSOAandothermoderntechnologyandconceptssuchascloudcomputing.

Formostcompanies,apartofthebusinessvisionwillbeworkreduction,qualityimprovement,improvedflexibility,speedinchanging,andimprovedmanagementcontrol.Ifpossible,staffreductionshouldnotbeakeypartofanyvisiontochangethecompany.Thereasonisthatalthoughthereisashort‐termcostreduction,thereisalonger‐termcostincrease,asknowledge,training,skillsandcompetencyarelostwithstaffreductions.Alsolostaretrust,commitmentandloyaltyasfeartakesoverandproductivityislost.Thisisahighpricetopayforashort‐termcostreduction.Butthatisadecisionthatwillbemadeoutsidethetransformation(inthebusinesscase)andwillbeakeyguidingfactorintheproject.

Inperforminganytransformation,orinmanycasesimprovementprojects,thepeoplewhowillbeaffectedneedtounderstandwhythechangeisneededandwhyitisneedednow.Agoodvisionwillcompelthemtosupportthechangeandactaccordingly.However,iftheycannotbeassuredthatthechangewillnotaffecttheirjobsorpay,experiencehasproventhatmostwillsimplyputoneobstacleafterthenextinthewayofthetransformation.Thiscanremovebenefitandproduceapoorsolution.Itcan,andhas,causedprojectstofail.

Theprojectteam,followingsoundchange‐managementpractices,willneedtoestablishasenseofurgencyinthebusinessmanagersandthestaff.Itisalsorecommendedthattheprojectsponsorclearlysetthestageforthoseaffectedtogainsomething,insteadoflosesomething.Thetransformationvisionshouldthereforebecompellingandstimulatepeopletoactquickly.Wehavefoundthatengagingpeoplebyaskingtheiropinionscausesexcitementandhelpscreatethissenseofurgency.Butthismustbebasedonafoundationoftrust.Tohelpbuildthisfoundation,itisimportanttopositionthetransformationinapositivelightatalltimes.Ifmanagementpositionsthetransformationinnegativeterms(“wemustdothistocutstaffandsavemoney,”or“wearedoingthistoprepareforamovetox”),theparticipantsmayfindincentivestomaketheprojectfail—andtheymaywellsucceed.

Alastthingtoconsiderwhilepreparingavisionstatementistogobeyondtheimmediateprojectobjective(s).BPMteammembersareoftenveryanalyticalpeople

Copyright A

BPM


287

bynatureandarepersuadedbynumbersandrationale,whiletherestofthestaffinanorganizationmaybemovedbysomethingmoreemotionalandinspirational.Wehavefoundthattransformationprojectswithaninspiringvisiongainalignmentandmomentummuchfasterthanthosewithavisionlimitedtoeconomics.Thisisimportantinsellingthechangetomanagersandstaff,andinavoidingskepticismaboutthechangebeing“thelatestmanagementfad.”

7.3.9 Organization Design

Toooftenorganizationsaredefinedbeforeprocessesaredefined—requiringmanagementtomaketheprocessesworkwithintheboundariesoftheexistingorganization.Thispracticecanleadtofrequentandinefficienthandoffs,qualityissues,anddisconnectsinthework.Tohelpavoidtheseproblems,asnewprocessesaredefinedinthetransformationproject,specialattentionshouldbegiventotheorganizationandthepossibilityofreorganizingtobetterenabletheperformanceofaprocess.

Inthosetransformationsthataredesignedtomovetheoperationtoaprocess‐centricmodel,itwillbenecessarytoconsidereitherredesigningtheoldorganizationstructuretoadjusttothenewprocessview,orcreatingaseparateprocess‐managerrolethatisexternaltotheorganizationstructure.Bothoftheseapproachestoprocessmanagementhaveworked,andtherightapproachdependsonthecompany’sculture.ThisdecisionwillobviouslybemadewithinputfromHR,butitshouldalsohaveactiveinputfromallmanagerswhowillbeaffectedand,inunionizedshops,unionrepresentatives.

Intransformationprojectsthatretaintheoldorganizationstructure,thebasicsetupofthebusinesswillremainthesame.Minorchangesmay,however,beneeded,andifacceptablewillbecomepartofthenewbusinessdesign.Intransformationsthatarelimitedinthisway,theprojectteamwillneedtotakestepstomakecertainthattheworkinthedifferentorganizationunitsisrecombinedtorecreatetheprocesses.Thiswillshowanyholesintheprocessthatneedtobefixedandidentifyallhandoffsthatmayneedtobecontrolled.

Newprocessesmayalsointroducenewrolesorimpactthelevelofstaffskillneededincertainroles.Asnewrolesaredefined,jobdescriptionsandperformancemeasuresshouldbeupdatedaccordingly.Oftentheimpactonpeoplevariesbytheirroles,butmostwillbeimpacted.Definingroleswillhelpbusinessmanagerssellrole‐changestothestaff,tailortrainingandcommunication,andaligncompensationbyroles.

Thekeyisthattheorganizationcannowbereviewedandredesignedasneededtoreflecttheworkthatwillbedoneandhowthatworkwillfitintothelargerprocesspicture.Thisprovidesachancetomodernizethewaytheoperationisstructuredandthewayitismanaged.

Copyright A

BPM


288

7.3.10 Organization Development

Inmostcases,organizationshaveevolvedinresponsetobusinessneeds.Iftheyweredesigned,thedesignisoftenlostintheevolution.Thisevolutionisoftenfocusedonstructure,andthechangesareseldomtiedtotrainingrequirements;staffskills‐improvementisoftenad‐hoc.Transformationprojectsofferachancetochangethissituationandaretheidealtimetohelpthebusinessmovetoa“learningenvironment.”Thismovetoanenvironmentwherethestaffandmanagerscontinuetolearnandshareexperiencesisatoughtarget,butitshouldbepartofthetransformationgoals.

Formanycompanies,themovetoalearningoperationchangestheirculture.Assuch,itbearsconsiderationalongwiththechangesneededtomovetocontinuousimprovementandthemanymorechangestoactivities,approaches,andattitudesthatmakeupacompany’sorgroup’sculture.

Thisshifttoalearningorganizationreliesontraining—aprimaryorganizationaldevelopmenttoolandacriticalpartofanytransformation.Itisessentialinchangemanagementandindeliveringasuccessfulnewoperationthatsupportsthenewoperationmodel.Oncetheskill‐needsandtrainingobjectivesrelatedtothetransformedbusinessdesignarewelllaidout,askillsassessmentcanbemadeandatrainingstrategydeveloped.Thetrainingstrategyshouldconsiderthepopulationtobetrained,theirgroupingbyrolesorotherlogicalmodes,thetrainingapproach(instructor‐ledclass,coaching,self‐pacedlearning,etc.),thetrainingcurriculumforeachtrainingactivity,thelistoftrainingmaterialneeded,theidentificationoftrainers,andadescriptionofhowthetrainingactivities’performancewillbeevaluated.StakeholdersMatrixandRoleMappingaregreatforhelpingtoidentifyandunderstandthepopulationthatwillbeimpactedanddesigntherightskill‐developmentplantosupportthetransition.

Oncetheprocessorbusinessoperationistransformed,workandprocesswillflowdifferently,andmanypeoplewilldotheirworkdifferently.Theapproachthatistakenintrainingwillmakeabigdifferenceinstaffconfidenceandthesuccessofthetransformation.Butjustprovidingtrainingisnotenough.Ifitisprovidedtooearlyinthesolutiondevelopment,itwillbeforgotten.Ifitistoogeneralortoodetailed,itwillsimplycausefear.So,trainingplanningiscriticalandtimingisimportant.

Ifthestaffhasparticipatedinthenewdesignandinitsevolutionthroughiterationandsimulation,theywillbefamiliarwiththewaythenewbusinesswillwork.Toremovethefearofmistakes,detailedjust‐in‐timetrainingonthebusinessoperation,eachjob,thenewapplications,thewaytheITsupportwillwork,thewaytheBPMSenvironmentworks,andthewayruleswork,willbeimportant.Thistrainingshouldendwithatest.

Weaknessesshouldbereviewedwitheachpersonindividuallytobringthemtothelevelneeded.Duringimplementation,itissuggestedthatamentorbeavailabletohelpanyonewholoseshisorherplaceandneedshelp.

Copyright A

BPM


289

Giventhatstaffacceptanceisagoal,itisimportanttotakeallstepsneededtocreateconfidenceintheirabilitytodotheirjobsinthenewoperations.Thishelpsimprovetheresultsofthechangeandhelpstoavoidalongperiodof“trialanderror”aspeoplelearntheirnewjobs.

Promotingopenquestioningandrequestsforhelpinlearningisoftenaculturalchange;manyareafraidtoaskforhelporadmitthattheydon’tknowsomething.Thisperceptionmustbechangediftheoperationeverhopestoevolveintoatruelearningoperationwherepeopletrythings,learn,andthenhelptheoperationevolve.

Formost,movingtoa“learning”operationmodelisinthefuture,butintransformingtheprocessandthebusinessunitsthatperformitsactivities,theprojectteamcansetthefoundationsforthisevolution.

Beforemovingontolookatcommunicationinthenextsectionofthischapter,aspecialnoteisinorder.Theabilitytodelivertrainingischangingasnewtechnologiesallownewtrainingoptions—startingwiththeuseofsocialtools,mobiletechnology,andevennetworkdesign.HRdepartmentsareusuallywellsuitedtosupporttheprojectteaminpickingtherightsetoftoolsandtechniquestobalancethetransformationteam’strainingstrategyandplan,andshouldbeconsultedbeforeanytrainingapproachisrecommended.Inprojectswherecommunicationsneedsareaddressedthroughflexibletechnologysupport,web‐basedtraining,complementedwithonline“help”supportandcoaching,isverysuccessful.Inprojectswheretrainingisconsideredlaterintheproject,adifferentapproachwillbeneededanditwillbenecessarytoprovidemoretraditional“classroom”trainingopportunity.Thetrainerinthesesituationswillplayacriticalchange‐agentrole,asitmightbethefirsttimemanypeoplewillhearaboutdetailsofthechangeanddiscoveritsimplicationsforthem.Tohelpavoidproblems,westronglyrecommendawell‐balancedapproachthatincludesleadershipinvolvement,aformaltrainingprogram,andopencommunication.

7.3.11 Communication

Communicationplanningshouldbeconsideredduringtheprojectstartupandupdatedatmajorpoints(milestones,phasegates,deliverablepoints,etc.)inthetransformationproject.Eachupdateshouldbebasedontheprojectmanager’sassessment(workingwiththebusiness‐unitmanagers)ofwhichchangemanagementtechniquesareworkingandhowchangemanagementissuesmayberesolved.Thisallowstheplan,andtheapproachbeingusedtocontrolstafffear,tobeadjustedasneeded.

Theneedforgood,opencommunicationcannotbeoveremphasized.Itishistoricallyoneofthemainfail‐pointsinchangemanagementanditdoesnotalwaysworkthewaymanagementthinks.Languagecanbeimpreciseandmanycleverpeopleliketonuancetheircommunication.Whentheresultismisunderstanding,trustislost.Forthisreason,communicationshouldbedirectandsimple,usingcommonlanguageandterms.Nuanceshouldbeavoided.

Copyright A

BPM


290

Agoodcommunicationapproachisfocusedonkeepingallstakeholdersinformedofprojectactivitiesandprogress.Maintainingconsistentfeedbackisanimportantpartofasolidcommunicationapproachandensuresanongoingdiscussionwiththeprojectteamandtheleadershipteam.Toencouragethistwo‐waycommunication,theapproachtakenshouldgiveresponsibilityforthisinteractiontobusiness‐arealinemanagers.Thishelpsbuildabusiness‐areanetworkofprojectchampionswhowillpromotethebenefitsofthetransformationintermsthestaffcanrelateto:thatis,whatisinitforthem.

Note:Whileconventionalwisdomfocuseschangebenefitonthecompany,intoday’sbusinessworld,peoplehavelargelylostloyaltytothecompany—especiallyintransformationprojectswheretheywaittobelaidoff.

Inthisenvironment,successwillrelyonbenefittothecompany,tothelinemanagers,andtothestaff.Ifeveryonewinsinthetransformation,thepeoplewilldotheirbesttomakecertainitsucceeds.Soundcommunicationsapproachesuseallmeanspossibletoreachmanagersandstaff—e‐mail,phone,web,handouts/posters,meetings,roadshows,etc.Asnotedearlierinthissection,theapproachshouldbeupdatedfrequentlyinresponsetofeedbackandorganizationalreactiontochange.InaBPMtransformationproject,theneedfortwo‐waycommunicationbecomescriticalduringthenewdesignphaseoftheproject.Herethedesignismeanttobeiterativeandthestaffinvolvedineachsimulationtodeterminewhatisgoodaboutitandwhatneedstochange.ThisinvolvementissomewhatuniquetoBPM.Butitisadifferencethatcanbeusedtoassuresuccessbydrivingoutfearandmakingpeoplebuyintothesolutionbeforeitisdeployed.Then,followingdeploymentasthebusinessunitsintheprocessmoveintocontinuousimprovement,thisopencommunicationwithstaffatalllevelscanbeusedtoidentifyimprovementsandpotentiallyredesignthebusinessmodelsandrulesneededtomakechangestotheworkflow,workmanagement,andapplicationsgeneratedbytheBPMS.

7.3.12 Alignment

Asimpleprocesschangecanhaveanimpactonmanyotherthingsintheorganization(seeFigure56).Clearly,thealignmentoftheseandsimilarfactorsaffectsanorganization’sabilitytogetresults—forbetterorworse.Butincompaniesthatareperformingtransformationprojects,thealignmentofthesemanyfactorsmaybeaproblem.

Becauseofthis,itwillbenecessarytoconsiderhowprocess,activity,problems,andthealignmentofallthevariousbusinessfactorsthatdefinefunctionscanbeaffectedbyasolution.Agreatmanythingsthataredoneaffectoneanotherandmustbeconsideredtogether.Belowisagraphicalrepresentationofmajorelementsofanorganizationandhowtheyrelatetoeachother.

Thischartismorethanalittlecomplex:itrepresentstheinterconnectionsbetweensomeofthekeypartsofthebusinessoperationandshowsthatanychangecanhaveaconsiderableimpactonotherbusinessareasandsuccessfactors.Thediagram’simportanceisinshowingthattheprojectteammustconsideragreatmanypartsof

Copyright A

BPM


291

thebusinessandmanagenotonlyhowallwillchange,butalsotherippleofanyparticularchange.

Figure56

Therippleandtrackingitareespeciallyimportantinanyprojectthataddressesonlypartofaprocess.Heretheteammustconsidertheimpactonprocess,people,andtechnologyworkdownstreamandthemanycomponentsthatdefinethebusinessoperationandhowtheoverallprocesswillbeaffected.

Tryingtoattendtoallofthesefactorsorcomponentsisoverwhelming.InourexperiencewithBPM,thekeyareastofocusonwhenitcomestimetoaligningthedifferentcomponentsofachangearethefollowing:

Key:Ex:Executives,S:Strategy,BI:BusinessIntelligence

Copyright A

BPM


292

Figure57.Aligningpeople/operations(process)/technology

OneofourgoalsinaBPMSinitiativeistomakesurethattheprocesswedesign(1)fitsproperlywiththebusinessstrategyandotherbusinessandITsystemsinplace,(2)providesclearproceduresforthosewhohavetodothework,and(3)providesexecutiveswithsoundreportingcapabilitiesforprogressandperformancemonitoring(seeFigure57).Butthisalignmentisaconstantlyshiftingtargetasorganizationsexperiencechangeonanongoingbasis.Assuch,itshouldberecognizedthatitimpossibleforustoreachandkeepperfectalignment.However,thegoalshouldbetobringthenewbusinessdesignasmuchintoalignmentasispossibletohelpglidethechangethroughitsintroduction.

Otherfactorsinthiscomplexinteractionwillrisetothesurfaceasissuesandconcernsarediscussedandcanbeaddressedasneeded.

Anotherthingtoconsideristhealignmentofthechangemanagementplantothelevelofimpactaprojectwillhaveonthebusinessoperation.ForsmallerBPMimprovementprojects,theproject’simpactonthechange‐managementapproachtakenmaynotbesignificant.However,intransformation,theimpactwill,bydefinition,besignificant:itwillbeinvasiveandpervasive.Transformationchangesthefundamentalapproachtothebusinessoperationwithnewideas,newapproaches,newapplications,andmore.Thenewbusinessdesignwillneedtomakecertainthatthenewworkactivitiesandsupportallaligntodeliverwhatisneeded.Thechangemanagementplanandapproachusedinthistypeofprojectmustbedesignedrecognizingthetrueissuesandconcernsthatthetransformationholdsformanagersandforstaff.

Theapproachtomanagingchangeonthestaffmustalsobedesignedtoalignwiththelevelofriskassociatedwithtransformation.Itmustbringtheideasoftheaffectedmanagersandstaffandallotherfactorsintoatypeofculturalalignmentwiththegoalsandneedsoftheoperation.Asnotedabove,thisrequiresaflexibleapproachthatwilladjustastheprojectchangesthebusinessandaspeoplebecomemoreinvolved.

Clearly,thefasteralloftheseaspectsofchangecanbebroughtintoalignment,thefasterthechangewillbeassimilatedbythebusinessmanagersandstaff.Buttheoppositeisalsotrue.Thegreaterthemisalignment,thehighertheriskoffailureand

Copyright A

BPM


293

thehighertheprobabilitythatthesolution’svaliditywillbechallengedbythoseaffected.

7.3.13 Support

SupportforChangeManagementmuststartduringtransformationprojectplanning.Itisimportanttoadequatelyaddressthehumanpartofthechangeequationasearlyaspossibleintheprojectbecausepeoplecanmakeamoderatesolutionasuccess,andagoodsolutionafailure.Thedifferenceisrelatedtotheirinvolvementintheprojectandtheiracceptanceofthesolution.Forthisreasonmanagementatalllevelsshouldclearlysupporttheneedtoaddressthecultural,HR,salary,evaluation,andoverallperformancemeasurementaspectsoftheproject.

Followingtraditionalprojectmanagementapproaches,theprojectisoftenformallyclosedassoonasthedeliverablesarecompletedandacceptedbythesponsor.InBPMSprojectswecarrythisonestepfurtherandtracktheadoptionofthechangeuntildesiredperformanceisreached.Wealsotrytohavetherightsupportstructureinplacetomentorthepeoplewhohavebeenimpactedandansweranyquestionsonavarietyofissues—onthenewsystems,theindividual’snewroleandresponsibilities,thenewprocessesandanyotherareawherequestionsmayarise.

Accesstotheavailabletrainingandsupportshouldbeclearlycommunicatedandmadeeasilyavailable.However,itistheresponsibilityofmid‐levelandlinemanagerstomakecertainthateverypersonwhowillbeaffectedhastimetotakethistraining,demonstratetheirunderstandingofitwhentested,andarereadytoperformtheiractivitiesinthenewbusinessoperation.

ExecutiveLeadershipshouldalsobereadytoanswerquestionssuchas,whyarewedoingthis?Whynow?Howdoesitfitwiththecorporatedirection,vision,andmission?Andisourcorporatestrategychanging?Themoretransformationaltheproject,themorethestaffwillbeeagertohearfromtheexecutive.

Mid‐managementshouldalsobewellpreparedtoanswerthequestionsimportanttotheirdirectreports.Theseinclude:Ismyrolechanging?Aremyresponsibilitiesdifferent?Willwehavetraining?WhocanhelpmeifIamstruggling?Willmybonusstructurechange?Willwebeevaluateddifferently?

Inallchanges,bothmanagersandstaffwillwanttohearfromtheirimmediatesupervisors(oftenthemid‐managementlayer)abouthowthechangewillaffectthempersonally.

TwoothergroupsthatmightalsoneedtobereadytosupporttheimplementationofchangesintheneworganizationaretheHRgroup(incaseofsignificantchangeinroles,responsibilities,andperformanceevaluationstructure)andIT(ifnewsystemsareputinplaceandhelp‐deskstaffneedtoanswerquestionsrelatedtothenewsystems).

Theidentificationofsupportneedsandthepeoplewhosesupportwillbeneededshouldbeconsideredasearlyintheprojectaspossibleandbuiltintothechangemanagementapproachandplan.Thiswillhelprelieveanxietyamongst

Copyright A

BPM


294

managementandstaffandshowthatthetransformationisimportanttothecompanyandtoindividualpeopleaffectedbyit.

7.3.14 Performance Management

Incertaincorporatecultures,peoplehavebecomeafraidtobemonitoredandmeasured.If,inthepast,measurementhasbeenusetopunishmanagersandstaff,itwillhavecreatedaclimateofdistrust,becauseitishumannatureforpeopletohateanyonelookingovertheirshoulderandevaluatingthemwhenmotivesarequestionable.Thatmustbechangedifinnovationandoutside‐the‐boxthinkingistobepartofthetransformedbusinessprocess.Thisbreakingofoldbarrierswilltaketimeasmanagementbuildstrust.However,thisisachangethatwillneedtobedrivenfromexecutivelevelsdownandpromotedfrequentlybyexecutivemanagement.

Thechangefromafearofevaluationtoanopennesstotrynewideasshouldbepartofamovetoalearningorganizationwhereideasaresoughtandtriedinsimulation(somethingthatisnotpossiblewithoutaBPMSorsimulationsystem).Performancemonitoringandmeasurementinthisinnovativeenvironmenttakesonadifferentmeaningandisnotviewedaspunitive.

Inthetransformationproject,performancegoalsshouldbeclearlydefinedtargets.Thesimulationmodelingofthe“AsIs”businesswillprovideabaselineofthecurrentperformance.Businessmanagersandstaffwillbeabletousethebaselinetomeasurethedeliveryoftheproject’sgoalsasimprovementsagainstthecurrentoperation.Usingiterationwiththesimulation,theywillbeabletohelpdesignoptimalsolutionsandprovethatthesolutionshoulddeliverthegoals.Thisallowstheprojectteamandthesponsortolearnfromeachiteration,andapplythenewinsighttothenextiteration.Inthisway,theteamcontinuestogrowinknowledgeandabilitywhilethenewsolutionevolvestoameasurablelevelofimprovement.

Thisapproachpromotesacceptanceofthefinaldesignbecauseitgivestheprojectteamandallwhoareinvolvedinthedesignandmeasurement,asayinhowthegoalswillbemade.Also,duringthedefinitionofthegoals,thebusinessmanagerswillhavehadinputintohowperformancewillbemeasuredandevaluated—thedataandtheformula.Thisinvolvementispartofachangemanagementapproachthatisdesignedtomakethemovetoperformancemonitoring,measurement,andevaluationmoreacceptable.Andacceptance,asdiscussedelsewhere,iscritical.

PerformanceManagement,whenusedappropriately,isaverypowerfultoolinhelpingpeopleclearlyunderstandperformancetargets,theirroleindeliveringthem,andindetermininghowtheorganizationisprogressingtowardthem.Implementingtheperformanceprogramalsoprovidesagoodopportunitytoengagepeopleindiscussionofhowwellthechangeiscomingalongandwhatcanbedoneiftheperformanceisnotasexpectedordesired.

Finally,asmentionedearlierinthechapter,itisessentialtomakecertainthatthenewperformancemeasurementprocessandtargetsalignwitheachindividual’sperformanceevaluationgoals.Ifthetwodonotalign,theindividualperformance

Copyright A

BPM


295

evaluationtargetswillneedtobeusedinanyevaluation.Peoplearemotivatedtomeettheirindividualperformancegoalstoobtainpositiverecognitionfromtheirsupervisorandanyfinancialgainassociatedwithgoodperformance.

7.3.15 Process Transformation and Change Management

Aswehavediscussed,changemanagementandthehumansideofthetransformationequationareacriticalpartofbusinessprocesstransformation.Therestoftheprojectdealswithactivityandtechnology,bothofwhicharecritical.People,however,willmakethetransformationsucceedorfail,andomittingtheiractiveinvolvementcanleadtoseriousproblems.

Changemanagementhelpstheprojectteamfocusonthepeoplewhowillusethesolution.Intransformation,unlikewithimprovement,asthebusinessoperationischanged,thepeople’sjobswillchange.Thisincludestherulestheyworkwith,thewaytheydoworkandthewaytheyareevaluatedandpaid.Transformationtouchesallofthebusinessoperationwithinscope.Thisisunsettlingtomany—especiallytothosewhohavebeendoingtheworkforsometimeandarecomfortableintheirsuccess—butkeepingthemontheoutsidetosavestaffcostisamistake;theirknowledgeissimplytoovaluabletoignore.Bringingthemintothetransformationwillbethemaindriverofthesolution’sconcernforhumanengineering,anditiscriticalitbeperformedintherightway.Asdiscussed,becauseofitsscopeandimpact,thechangemanagementactivitywillneedtobeaformalpartofthetransformation’splanandexecution.

Theinformationinthissectionisagoodoverviewofsomeofthethingstoconsiderwhenlookingatchangemanagement—butitisnotallofwhatmustbeconsideredandisnotcustomizedtoyourcompany.Forthisreason,itisimportanttoworkwithchangemanagementexpertsinyourcompanytodeterminethebestwaytoapproachculturalchangeandtraining.

Change Management Summary

Awell‐managedchangeshould

Callouttangiblebenefitsfortheindividualandtheorganization Haveasharedandcompellingvision Havevisibleandcommittedsponsorsandleaders Promoteearly,withfrequentandactivestakeholders’participation Buildownershipandaccountability;createtransformationandBPM

champions EnsureeffectivecommunicationsareintegratedwithsolidProject

Managementpractices,especiallyaroundrisksandissues Offerappropriatesupportduringandfollowingtheproject Continueafter“golive”untiladoptionandperformancehavereached

expectedlevels.

Investingtimeinchangemanagementtofocusonthepeoplesideoftransformationincreasestheprobabilityofsuccess,speedsupadoption,anddecreasesproductivityloss.Itisalsoimportantindrivingoutfearandincreasingtrustandloyalty.This

Copyright A

BPM


296

createsafoundationforsolutionoptimizationandcontinuingimprovement—bothimportanttothecompany.

7.4 Getting Ready for Process Transformation

Businesstransformationmuststartwithstrategyandeitheritsconfirmationorchange.Itmustalsodealwiththeperspectiveonthedirectionthecompanywilltakeandwhattakingthatdirectionwillmean:howthecompanywillchangeandwhy.Thisisthestrategicsideofbusinesstransformation.Oncethestrategyisapprovedbyexecutivemanagementand/ortheboardofdirectors,thetransformationmovesfromtheconceptualtothephysical:thatis,realchangestothebusinessoperation.Theteamandthecompanywillnowknowwhythisisbeingdoneandwhatisexpectedintermsofchange,goals,andsupportforanewoperatingdirection.

Tobeginanyoperationtransformationeffort,thecompanymustunderstandthewaythebusinessoperationreallyworks,andnotjusthowpeoplethinkitworks.Thisiswheretheconceptualunderstandingandthephysicalrealitymeet.Everyoperationexiststoperformworkthatsupportssomeserviceorproductionstrategy.Butinthenormalhierarchyofanorganization,theunderstandingofthebusinessoperationandwhyitexistschangesasonemovesupordowntheorganizationchartfromthelinemanager.

Mostseniormanagerswillhaveasoundunderstandingofhowtheoperationissupposedtobeworking.Ataconceptuallevel,thecompanyusuallydoesworkthatway.Butthencomesthetranslationoftheconceptualintoreality—theworkthatisdoneandhowitisperformed(includingdecisionsandrules).Thisiswheredisconnectsoftenhappen.Thefactisthatfewseniorpeopleneedtounderstandhowthebusinessoperationsworkatamid‐levelofdetailorlower.Theydounderstandwhateachbusinessunitdoesandwhateachproduces.Buttransformationmustalsodealwiththewayworkisperformed.So,itisnecessarytorecognizewhatmanagersateachlevelcanofferandhowthatknowledgecanbeleveragedattheappropriatetimeandplaceinthetransformation.

Totakeadvantageofthis,itisnecessarytodefinewhattheteamwillbelookingforfrommanagersateachlevelinthecompany.Standardquestionnairesthatcanbemodifiedtotheindividualmanagershouldbecreatedtomakecertaintheteamlooksfortherightlevelofdetailfromeachinterview.

Seniormanagerswillplayacriticalroleearlyintheproject,whenanunderstandingofstrategyiscritical.Thislevelofmanagementdealswithstrategicchangeandisresponsibleforlookingatthebusinessandmakingfundamental,broad‐scopeoperatingdecisionsandchanges.Thisisbusinessreengineering,anditiscriticalinatransformationeffort.Ittiesstrategytochangeandtothebusinessoperationanddefineshowthefundamentalrethinkingoftheoperationsupportsthestrategicgoalsofthecompany.

Heretheseniormanagersdealwithbusinesscapacitiesandthebusinessfunctionsthatmakethemup.Creativityandtheapplicationofnewtechnologyareimportant

Copyright A

BPM


297

here—possiblymoreimportantthanatanyotherlevelinthetransformationbecausetheycreatethefoundationforthechange.Becausestrategydealswithconcept(ithasnodirectexecutionorphysicalcomponents),wecanconsideritaconceptualmodel.

Followingthisfundamentalrethinkingoftheoperation,transformationactivitywillfocusonthemid‐level(departmentorbusinessunit)managerforeachbusinessunitandthenlinemanagers,asthetransformationeffortmovestoalower‐leveloperationalview.

Thesemid‐levelmanagersnowhavetheresponsibilityforlookingathowthereengineeredbusiness(high‐level)conceptualdesignwillaffectthemandhowthephysicalmodelsoftheiroperationsmustchange.Fundamentalrethinkingalsohappensatthislevel.Inmovingfromtheconceptualdesignleveltothephysicalorexecutiondesignlevel,themanagershaveachoiceofapproaches.Theycanfollowthetraditionalorganizationmodelormovetoaprocess‐basedoperatingmodel.Partofthedifferenceis(andtheBPMbiassays)thataprocessfocusallowsyoutolookattheentireend‐to‐endprocessandoptimizeit.Thenlookathowthebusinessunitsthatsupportitwillchangeandhowtheywilleachoptimizetheiroperation.Theadvantageisabroad‐basedoptimizationinsteadoforganizationallyfocusedoptimizationthatmayfailtoproviderealimprovementatthehigherprocesslevel.Inbothapproaches,theoptimizationeventuallygetstothebusinessunitlevel.Theconcernisthatitispossiblemakeimprovementsinabusinessunitthatcauseseriousproblemsindownstreamactivitiesinotherbusinessunits.Inaddition,anorganizationapproachlimitsthetypeofperformancemonitoringandmeasurementthatcanbedone.

Linemanagersandtheirstaffbecomecriticalparticipantsatthislowerlevelofdetail,inthedefinition/analysis/redesign.Everyactivity,task,scenarioanddeliveredsubassembly,service,etc.,mustbereviewedandquestioned.Eachmustbejustifiedandthosethatremainmustbeviewedwithacriticaleyeforfundamentaloperationalchange.Allmanualworkmustbequestioned.AllqualityKPIsandstandardsmustbeconsidered,alongwitheffectivenessandefficiency.Followingaprocessapproach,themid‐levelmanagersmustworkincollaborationtomakecertainthisdesignimprovesboththeprocessandtheirwork.Inreachingconsensusonthenewdesign,itispossiblethatanymanagermayneedtocompromiseandgoalongwithasolutionthat,whilenotoptimalforthem,isoptimalfromaprocessperspective.

Participatingmanagersthenneedtofocusontheirbusinessunitsastheprojectmovesforwardandthelower‐leveldesignsmustbebuilt,includingtheinformationneededforapplicationgenerationorthebuildingofapplicationsystemspecs.

Thisallowsthebusinessunitworkflowandactivitiestobecombinedtoformprocessesandthenalignedtobusinessfunctionsandbusinesscapabilities—whichthentietostrategy.

Copyright A

BPM


298

Thisprovidesacompleteview—fromconceptualtothephysicaloperationandbacktotheconceptualview—ofthenewdesignasitrollsuptoensurethatstrategyissupported.

Inthisprogressionofinvolvement,theprojectwillfirstneedtotakeadvantageof

1. BusinessArchitectureandBusinessArchitectstolookatstrategyanditsimpactonthebusiness.Itwillthenmoveto

2. ProcessArchitectureandProcessArchitectsasthecurrentbusinessoperationisdefinedandmodified.Thechangestothebusinesswillthenrequiretheinvolvementof

3. EnterpriseArchitectstolookatthebusinessneedsfromanITperspective.

TheparticipationoftheseindividualsalongwithEnterpriseArchitectswillneedtobebuiltintotheprojectapproachandplan,alongwiththedifferingrolesofmanagers(seniorthroughmid‐leveltolinemanagers).

Tohelpguidemanagementthroughthischangeprocess,theteamshouldconsideradoptingaformalBPMS‐basedBPMprojectmethodology.Thiscanbeinternalifthecompanyhasone(ITmethodologieslikeAgiledonotcount),orpurchasedifthatmakessense.Butthekeyistocreateaconsistentframeworktobasetheprojectanditstaskson.Thismethodologyshouldincludeformalchangemanagementactivitythatismeanttoengageabroadpartoftheworkforceandwintheirbuy‐in.

ThetransformationprojectplanwillbebasedonthetasksandguidanceintheBPM/BPMSprojectmethodology.Thisplanwillbecustomizedtofittheproject,companystandards,companyculture,andfinancialrealities.

Indefiningthedirectionthatwillbetakeninanalysisanddesign,itissuggestedthattheprojectteamidentifythetechniquestheywilluseandwheretheywillusethem—ValueChain,Lean,SixSigma,CMM,Activity‐BasedCosting,etc.

Butbecauseitshouldbebuiltfortheproject,theapproachandplanmustbeunderstoodbyall,bothdiscussedanddebated,tomakecertainitisaccepted.Governancethenmustensurethateveryonefollowstheplanandlivesuptotheircommitments.

Thechangesinthebusinessstrategyandbusinesscapabilitiesandtheirfunctionswillnowprovidethebasicrequirementsforthetransformation.ThesebecometheCriticalSuccessFactors.TheserequirementsandCriticalSuccessFactorsarebuiltintotheapproachandtheprojectplantoensurethattheydrivetheanalysisandredesign.

7.4.1 Creating a change‐ready operation

WhiletherequirementsofthetransformationanditsCriticalSuccessFactorssetthestageforchange,theydonotprovidetheabilitytoactuallychange.

Transformationmusttakeplaceatalllevelsintheprocessorthebusinesscapabilitiesthatarebeingchangedaspartoftheproject.Hereatop‐downapproachshouldbeconsideredbecauseworkthatisperformedtodaymaysimplynotbe

Copyright A

BPM


299

necessarytomorrow.Thefundamentalrethinkingwillquestioneverythingandproposenewwaysofdoingbusiness—includingnewautomationandoutsourcing.So,thebusinessoperationmaybecomeamixtureofworkthatisverydifferentfromtoday’s.Inthis“nothingisoffthetable”approachtotransformation,themanagersandprojectteamwillbechallengedto“thinkoutsidethebox”andleverageemergingconceptsandtechnologytocomeupwithnewideasonhowthebusinesscouldrun.Partofthisquestioningandoutside‐the‐boxthinkingwillbebasedonBPMS‐basedBPMtechnologyandapproachestobothchangeandcontinuousimprovement.

Butthekeytorealtransformationisthecreativeapplicationofknowledgeonhowthebusinessactuallyworksatalllevels,includingthemarket,legislation,andtechnology.Thismustbeknowledgeofboththecurrentstatusinalltheseareasandanychangesthatexpertsarepredicting.Itiscreativitythatdifferentiatesbetweenteamsandcompanies.

Theteamwiththemostcreativepeoplewillbeinnovative,andideaswillbeverydifferentfromthoseofmoretraditionalteams.Partofthedifferenceisinnotknowinganybounds.Forthisreason,itissuggestedthatpeoplewithtransformationexpertise,evenfromotherindustries,beaddedtotheteam.Theytendtoquestiondifferentthingsandproposeideasfromnewperspectives.

Givencreativityandinnovation,theteamwillbefacedwithlookingattheoperationinnewways.Manyoftheideaswillnotbefeasible.Manywillsimplynotwork.Manyotherswillnotbepalatableinthecompany’sculture.Buteveninrejectedideasthereisoftenanuggetofgold.Thesecanaddupandtogetherallowtheteamtomakedesignchangesthattheywouldotherwisenothaveconsidered.

Thisquestioningandlearningmakesthetransformationprojectthestartofbuildingachange‐readyoperation.Regardlessofhowgoodthenewdesign,likeallotherbusinessdesigns,itwillquicklybecomeobsoleteandnotreflectthechangingbusinessenvironment.Toavoidthisaging,itwillbenecessarytoaddcontinuousimprovementtotheapproach.Herethegoalistocreateanoperatingenvironmentthatlearnsandthenappliesthatlearningtoevaluatethebusinessforimprovement.

Toachievethis,atransformationmustbeviewedasopen‐ended.Thefirsttransformationprojectwill,ofcourse,haveanend‐dateanddeliverabletargets,buttheprojectshouldnotendthere.Thispointshouldbeviewedasthestarting‐pointofitsevolution,notanend‐point.

Thisapproachallowsthecompanytoconstantlyviewtheoperationaschanging.Inthepastthiswasascaryconcept.Buttoday,inaBPMS‐supportedBPMoperation,thechangeislessdramaticandlessrisky.Itismoredynamic.Inthisway,thefirsttransformationprojectsetsthestageforcontinuousimprovementandprovidestheembeddedperformancemonitoringneededtoconstantlylookforproblemsandwaystodothingsbetter.

Thiswillrequireachangeinthewayprojectsandbusinessevolutionareviewed.Today,open‐endedprojectsareseldomtolerated—evenonesthatofferaseriesofdeliverydatesandbenefitscometoanend.Butifacompanywantstomoveto

Copyright A

BPM


300

continuousimprovement,transformationneverreallyends.Oncetheinitialtransformationisimplemented,theoperationmovestoanunendingcycleofperformancemeasurement,review,analysis,andchange.

7.4.2 Funding: Always a problem

Asnoted,businesstransformationischangeatafundamentallevel,makingitdisruptiveanddifficult.Partofthedifficultyisthecostoftheseprojects.Thefundingrequiredisalwaysgreaterthanthatofanimprovementproject.Thebenefitcalculationisalsoalotharderbecauseanimprovementprojectwillhaveaverynarrow,specificsetofobjectivesand,correspondingly,benefits.Transformation,beingmorestrategic,shouldbevieweddifferentlyandshouldbefundeddifferently.However,intoday’sROI‐focusedenvironment,thetransformationwilllikelyneedtobejustifiedthesamewayanimprovementprojectisjustified—thatis,basedonhardbenefitestimate,notonstrategicneed.Butthiswillvarybycompanyandtheprojectmanagerwillneedtoworkwiththeprojectsponsortodeterminethefundingviewthatmakessenseinyourcompany.

Thekeyistoworkwithseniorbusinessmanagement,finance,andITtocreateanapproachandformulafordeterminingbenefitoftransformationefforts.Thisformalizedandapprovedapproachisraretoday,butitisrecommendedthatitbeconsideredbeforethetransformationeffortisrequested.

Fundingshouldalsobetiedtotheprojectplan.Iftheplanisbasedonamethodology,theprojectmanagerandsponsorwillbeabletoestimatetheworkandcostmoreeasily.Itwillalsoshowhowthefundingwillbeneeded(when,whatfor,andwhatwillbedelivered).Thiscanchangethewaythefundingisviewed.Byaligningfundingwithdeliverableandbenefitovertime,theinvestmentwillbespreadandthebenefitmaywellbeabletooffsettheinvestment.However,iftheinitialphaseordeliverableneedstocoverallBPMSandITinvestment,theprojectwilllikelynotbeapproved.ItisthereforeimportanttoworkwithITandwiththesponsortoseeifthereisawaytospreadoroffsetthecostofthetechnology.

Fundingmaythusfollowadifferentapproachthanthatusedforimprovementprojects.Theimportantfactisthattheprojectmanagerwillneedtodeterminetheapproachandformulaforlookingatbenefitintransformations.

7.4.3 Understanding the goals of the transformation

Languagecanbeimprecise.Termsmaybedefineddifferently.Ininternationalcompanies,currencytranslationandotherfactorsmayalsocomplicatethedefiningofgoals,computingofvalueandbenefit,andcompliancewithlegalrequirements.Whenprojectsaresmall,theimpactoftheseconsiderationsislimited.Whenprojectsarebig,likeatransformationproject,theimpactoftheseandotherissuescanbeveryserious.

Forthisreasonitisimportanttotakethetimetomakecertainthateveryonehasacommonunderstandingofthegoals,approach,measurement,andevaluationoftheproject’ssuccess.Ifthisisnotdone,therisksassociatedwiththeprojectincrease.

Copyright A

BPM


301

Thishashistoricallybeenakeyproblemwithoutsourcers,wherethereareoftenlanguageanddefinitionbarriers.Butitdoesn’tjustaffectoutsourcing.Itisseenconstantlyineverydayworkandoperations.Itdrivestheages‐oldissueofimprovinginternalcommunications—“thisisnotwhatImeant”—“butthatiswhatyousaid.”ItisalsothereasonthatABPMPurgeseveryonetobeginaprojectbydefining“common”andBPMterminology.Forexample,“customer”canhaveagreatmanymeanings.“Process”isalsoaverymisunderstoodterm;inoneonlineBPMdictionary,theterm“process”hasmorethan10differentdefinitions.Theteamandallthoseinvolvedmusthaveonecommondefinitionofanyterm.Ifnot,misunderstandingswilloccur.Accentandlanguageproblemsalsoplaytheirpartsinthesemisunderstandings.Allmustbeconsideredincollaborationandcommunication.

Tooffsetthisissue,itisimportantthattimebespentupfrontinthetransformationinworkshopstobringeveryonetoacommonunderstandingoftheproject,itsgoals,itsterminologyanditstasks.Thiswillallowmanagerstoknowwhattoexpectandtounderstandtheirroleintheproject.

7.4.4 The resources: Different people with different skills

Asnotedearlierinthechapter,transformationprojectsshouldbestaffedwithpeopleofferingavarietyofspecializedskills.TheseincludeBusinessArchitecture,EnterpriseArchitecture,ProcessArchitectureandProcessManagement,DatabaseArchitecture,WebServices,DataManagement/DeliveryandBusinessOperationsManagement.Insomecompanies,ChangeManagementcanbeaddedtothislist.Althoughtherearealotoftraditionalbusinessskills,BPMskills,BPMSskills,andtechnicalskillsonthislist,thetransformationprojectsrequireadditionalspecialtyskills.Transformationprojectsarebigandrequirealotofresources,bothfull‐andpart‐time.Theseskillsmayincludecloudcomputing,Lean,SixSigma,BPMstrategy,dataconsolidation,SOA,webapplication,customerexperience,andmore.

Itisthereforeimportanttoidentifythesourceofanyskillsthatmaybeneededsotheycanbeaddedtotheprojectteamifneeded.

7.5 Transforming the business: reaching optimization

Thefoundationforthetransformationissetforthinearliersectionsofthischapter(see,forexample,7.2).

Thekeysintransformationarethetargets(goals,standards,performancetargets,KPIsandrequirements)andtheapproach.Startingwiththegoalsandrequirements,theprojectteamandallparticipantswillneedtohaveacommonunderstandingofwhattheymean,andtheexpectationsofallbusinessmanagers,staff,andcollaborativepartnerswhoareinvolved.Thismustbeobtainedthroughworkshops,andconsiderationshouldbegiventoatesttoensureunderstandingofkeyconcepts,goals,requirements,ITcapabilities,etc.

Inaddition,theapproachwillneedtobeaugmentednowthatthefoundationisinplaceandtheprojectisstarting.Alotofissueswillhavebeenlistedin

Copyright A

BPM


302

transformationprojectsetup.Theseareagoodstart,buttheteamwillnowneedtodealwithproceduralissues,suchas

Howmanyoftheassumptionsmadeinconsideringtheprojectweresupportedbymanagement?

Howmanydiscoveryteamswilltheprojectteambebrokeninto?

Willtheinterviewsbeconductedbyasingleteammemberorbyapair—onetalkingandonetakingnotes?

Willtherebeadedicateduserortwo,orwilltheteamchooseabroader‐involvementapproachandtakealittletimefromalotofpeople?

WillthebusinessusersreceiveBPMStrainingorwillallmodelingbedonebytheprojectteam?

Whowillbeinvolvedincreatingthetransformationgovernanceandstandards?

Wherewilltheteamfindbusinessrules—manuals,memosandinterviews/workshops?Willanybepulledfromapplicationssystems?

Whatisoutofboundsinquestioningandconsiderationforchange—isoutsourcinginorout?Arenewwebapplicationsinorout?Candepartmentsbeeliminated?

Willtheteamtakeaprocessperspectiveoranorganizationperspective?

Willtheteamusesimulationmodelingorworkshopwalkthroughtotestthedesign?

WilltherebeaBPMorBusinessArchitectureCoE(CenterofExcellence)toprovideguidanceandstandards?

Thisisnotanexhaustivelist,merelysomeexamples.Thelistcontinueswithissuesthatarespecifictoyourcompanyandtheareasofbusinessintheproject.

Inactuallyperformingthetransformationactivities,theprojectteamshouldbeguidedbytheBPMS/BPMmethodologythecompanyhasadopted.Thismethodologywillprovidealistofthetasksthatneedtobeperformedandtheirrelationships,alongwiththedatathatmustbecollectedforeachgroupoftasksandthedeliverablesthatshouldbeproducedineachofthesetaskgroups.Theprojectmanagerwillaugmentthismethodologywithcompany‐standardformalproject‐managementtechniquesandactivitiestocreatethetransformationproject’splan.Tocustomizetheapproachandmethodologytothescope,complexity,andobjectivesoftheproject,itisrecommendedthattheprojectmanagerworkwiththecompany’sBPMCoEandIT.ItisalsosuggestedthattheprojectteaminvolveBusinessArchitectureandEnterpriseArchitectureatthepointsintheplanningthat

Copyright A

BPM


303

willneedtheirsupport.Theprojectplanandapproach,oncereviewedandacceptedbythesegroups,shouldthenbereviewedforformalacceptancebytheexecutivecommittee.Followingtheiracceptance,theplanshouldbepublishedontheproject’swebsiteanddiscussedinaworkshopwithallparticipants.Thiswillhelpensurethateveryoneunderstandstheproject,itsapproach,anditsplans.

Thetransformationprojectwillthenfollowacommonapproachthatiscustomizedtotheproject.Thisreducescostandriskwhileprovidingconsistency.Theprojectwillstartbymovingthroughthemethodology’sstart‐uptaskgroupstodefiningthecurrentbusinesswiththeconstructionofahigh‐level“AsIs”business‐operationmodel.Thismodelwillbefocusedontheprocess(es)thatwilltransformintheprojectandshowtheactivitiesassigned/performedbyeachbusinessunitinscope.Thisisakeypartofthetransformation.

Note:Everytransformationwillhavedifferentdrivers,goals,andscope.Somewillbeorganizationallyorientedandconfinedwithinabusinessunitordepartment.Otherswillbeprocessoriented.Theprojectplanwillreflectthescopeandgoals,buttheywillbothnowdefinethe“box”orlimitsofthemodels.

Thismodelwillbebrokenintolowerandlowerlevelsofdetailuntilacompletepictureofthecurrentbusinessprocess/operationinscopeisdefined.Businessrulesandtheapplicationsthatareusedwillbeidentifiedandthedatausedateachapplication“touchpoint”inthebusinesswillbeshown.Avarietyofmetrics(asdefinedasastandardbytheprojectteamandtheBPMCoE)willbecollectedinthediscoveryprocess.Iftheprojectteamwillusesimulationtotestthenewdesign—andthisisrecommended—thedataneededwillbeidentifiedandcollectedinthis“AsIs”discovery.The“AsIs”modelswillberuninsimulationtoobtainbaselinemetrics.Thesemetricsshouldbereviewedwiththebusinessmanagersandadjustedifnecessarytoaccuratelyrepresentthecurrentbusiness.

Theprojectteamwillnowneedtocreateahigh‐levelnewor“ToBe”designwithanticipatedimprovementmetricsinthemodelingtool.Everythingwillbequestioned,andinnovationand“outside‐the‐box”creativitywillbeapplied.Whilelegal,financial,andreportinglimitswillneedtobeconsidered,asidefromtheselimitingrequirements(andothersidentifiedbyexecutivemanagement),therearenolimitationstowhattheprojectteamshouldconsiderinthetransformationdesign.

Atthislevel,thereislittledetailontheactualoperations.Thislevelis,however,themostimportantlevelintheredesignbecauseitisherethatfundamentalchangeisfirstamaindriverintheredesign.Thiswillsetthestageforthedetaildesign.Iftheprojectteamistimidinthehigh‐leveldesign,littlewillchangeandthelackofcreativitywillguidethedetaildesignaswell.

Thishigh‐leveldesignwillprovidetheframeworkforthedetailed“ToBe”operationaldesign.Byenteringthemodelsintothesimulationapplication,theprojectteamwillbeabletotestthedeliveryofthehigher‐leveltransformationrequirementsandgoals.Toconfirmthedeliveryoftheexpectedtransformationoperation,theprojectteamwillwalkthroughthehigh‐levelsimulationwith

Copyright A

BPM


304

executivemanagement.Allcommentsandobservationswillbeusedtofinalizedthedesignandcreateafinalhigh‐levelsimulationtest.

Oncethehigh‐levelmodelshavebeenaccepted,therealworkofthetransformationwillbegin.

Thesehigh‐level“ToBe”modelswillbeusedtocreateaseriesofdetailed“ToBe”modelsastheprojectteamiteratesthroughdesignoptionstofindthebestnewdesign.

Followingaprocess‐centricapproach,itwillnowbenecessarytolookatprocessandthealignmentbetweenprocessandorganization.

Note:Ifthetransformationisfollowinganorganizationalapproach,theprojectwillnotaddressentireprocesses(whicharecross‐organizational)anditwillbenecessarytodeterminethepossibleimpactofchangesonthedownstreampartsoftheprocessthatarenotintheproject.Thisassessmentwillhelpdeterminewhatchangescanbemadeinthenewdesign.Thisisalimitationrelatedtoanorganizationapproach.

Oncethenew“ToBe”designisapproved,constructionofthenewbusinessoperationcanbeplanned.Itissuggestedthattheprojectdividethenewhigh‐leveldesignintopartsthatcaneachdeliveragivenpartoftheproduct.Thiscreatesacohesivenewdesignbuiltasaseriesofrelatedbutseparateconstructionprojects—thesameasisfollowedwithsub‐assembliescomingtogethertoformtheproduct.

Eachofthesecomponentpartscannowbedesignedatadetaillevel.Inthisdesign,thesameapproachofquestioningeverythingandbeinginnovativeshouldbeapplied.Aswiththehigh‐levelredesign,thenewdetaildesignsshouldbetestedanditeratedusingsimulation.Here,however,thedetaildesignsshouldbeapproachedbothasindividualtransformationprojectsandasapartofalargertransformation.Thisallowseachtobeconsideredindividuallyandalsoastheyfitintothelargertransformationdesign.Hereeachwillreceiveinputfromothercomponentsandeachwillperformactivity,anddeliverdataandproducttothecomponentsittouches,asshowninthehigh‐leveldesign.Thisallowsmanagementtotrackimprovementattheindividualcomponentlevelandattheprojectlevel.

Ofcourse,asthecomponentdesignsarebeingplanned,designed,tested,approvedandconstructed,ITwillbeprovidedwithhigh‐levelsupportrequirementsandmoredetailed‐levelapplicationinterface,Javamodule,webservice,databasedesignandotherspecs.SimulationtestingwillbetiedtothedeliveryofITinfrastructurechangesandtheneededinterfaces,etc.Thisdeliverywilldeterminethefinalsimulationtestingscheduleandtheoveralltransformationimplementationschedule.

Asall“final”simulationdesigntestsarecompleted,thenewdesignshouldbereviewedinawalkthroughwithallthepeoplewhowillworkinthenewbusinessoperation.Their“handson”inputmaycauseadditionaliterations,buttheresultwillbeanoptimalresult.IfaBPMSisused,thisnewlow‐leveldesign(businessmodel,rules,data,screens(forms))willbeusedtogeneratenewapplicationsthatare

Copyright A

BPM


305

producedandexecutedwithintheBPMSenvironment.ThesewillbetiedtotheIT‐builtsupport(Javamodules,etc.)tocreateacompletesolution.

7.5.1 Creating a Win‐Win outcome

Win‐Winmeanseveryonewins.Thecompanymustgainbenefitfirstofall.Butitcannotbetheonlywinner.Managersatalllevelsmustindividuallywinandsoshouldstaffmembers.Ifthisisakeygoaloftheproject,acceptanceofthesolutionwillbelikelyandriskwillbeminimized.

Winning,however,hasalotofdifferentdefinitions.Itmaymeanthatsomeoneisjudgedashavingperformedbetterthanexpected.Itmaymeanthatworkloadisreduced.Itmaymeanthattheculturechangestoonewherepeoplearetreatedwellandnotafraidofbeingfiredinadownsizing.Inattemptingtocreateawin‐winsolutionitisimportanttotalktopeopleandseewhattheyhopetogetoutoftheproject.ThisiswhereHR(HumanResources/HumanCapital,etc.)comesintothetransformationproject.

Whilethismayseemsimple,inunionshopsitisnot.Andintoday’shighlyregulatedbusinessworldwithlocalHRlawandreportingmandates,dealingwithpeopleissuesisanythingbuteasy.So,HRmustbeinvolvedinanyconsiderationofawin‐winscenario.

Butevenifdifficult,atransformationprojectmustlookatfundamentalchangestoworkandeverythinghavingtodowithpeople.Thesimplefactisthatanycompanyandanyprocessisasocialoperation.Peopleworktogether,interact,playpolitics,andmakethingswork—theyfindwaysaroundproblemseveryday.So,thepeopleandculturalsideofthetransformationarecriticaltosuccess.

7.5.2 The status of Legacy technology: help or limit to transformation

ITwilleitherbeahelpingoralimitingfactor.EvenifeveryoneinITincludingtheCIOiseagertohelpandjoininthetransformation,inmanycompanies,cost‐cuttinghaslimitedwhatITcando.LegacyapplicationsandalegacyITarchitecturecanservetolimitthetypesofthingsthatcanbeconsidered.IfapossiblechangecannotbesupportedwithoutamajorinvestmentinIT,itmayneedtobedroppedfromconsideration.

Aswekeepstressing,transformationrequiresrethinkingandaradicallydifferentapproachthanwastakeninthepast.Otherwise,youmaybesimplydoingmorequicklythethingsthathavelimitedyoursuccess.And,whilethismaybethecase,thereisalsoreality.Somecompanieshavefundingconstraints,somehaveITconstraints,somehaveunionconstraints,andthelistgoeson.Theserealitiesmustbeconsideredinanysolution.So,whilecreativethinkingisneeded,itmustalsobedonewithintheboundsofreality.

Heretheprojectteammaystillconsiderasolutionthatignorescertainlimitations—afterdiscussionwithexecutivemanagement:itallowstheprojectteamtolookatdifferingtime‐basedtargets.Ineachtargetthelimitationsandassumptionsthatarebuiltintothetransformationdesignchange.Asanexample,theend‐targetdesign

Copyright A

BPM


306

mightbebasedontheeliminationof,orspacingof,financialconstraints.Theprojectteamwillthencreateafinaldesignandbackofftoaddingivenconstraintsatdifferenttimeperiods.Becauseatransformationprojectismultiyear,itcanallowforchangeintheconstraintsovertimeandbuilddifferentsolutionsthatwillmovefromoneconstraint‐basetothenext,withlessconstraintovertime.ThisisespeciallyhelpfuliftheITarchitectureorinfrastructurewillbeaconstraint:itmaychangeasnewhardware,software,orcommunicationsareadded.

Inthiscase,theprojectteamshouldworkwiththeCIOandlayoutaseriesoftime‐relatedimprovementstotheITcapabilities.Itisthenpossibletocoordinatethedeliveryofdifferentphasesinanincreasinglyflexibleandcapableseriesofsolutionreleases.

7.5.3 BPMS and transforming the company

ManytodaybelievethattruetransformationcannottakeplacewithoutthesupportofaBPMS.Thereasonisthat,whileadesigncanbebuiltusingsimpletoolsorevenpaper,itwillnotbeascomprehensiveasitcouldbe.Simplystated,itisimpossibletokeepupwiththedatathatiscollectedinatransformationandthealmostdailychangestoit.

Also,withoutautomationitisdifficulttosimulateanoperation,andalmostimpossibletocontrolitsiteration.ThatiswhyITandothershavehistoricallytakenthepositionofgoingaboveandbeyondtomakecertaintheygettherequirements/specsrightthefirsttime.Butweallknowthatwhilethatisthegoal,itisseldomreached,particularlyincomplexprojects.ThebusinesssimplychangestoofastforanytraditionalIT‐developmentorsystem‐improvementprojecttokeepupwithit.

ButthebiggestreasonforusingaBPMSistheabilitytorapidlygenerateapplicationstobothimprovethewaytheoperationismonitoredandcontrolled,andprovidetaskautomation.ThisreducestheburdenonIT(createinterfaces/dataaccess,webservices,Javamodules,etc.),andsupportsanabilitytochangerapidlythroughiterativedesignsandtesting.Itisthisabilitytochange/monitor/analyze/iteratethatdeliversoptimizationandcontinuousimprovement.Thisisalsothetoolthatallowsalearningorganizationtoleveragelessons,eliminateproblems,andreducerisk.

7.5.4 Redesigning the operation: Process level, business unit workflow level, leveraging technology

Aswehavesaid,transformationisnotaboutdoingthesamethingsbetter.Itisnotsimplyaboutimprovingefficiencyoreliminatingerror.Itisaboutthecustomerandtakinganewlookatthebusinessoperation.And,itisabouttakingthisviewpointandradicallyrethinkingthewaythebusinessdeliversservice.Thisisacriticalpointinunderstandingtransformationandinredesigningthebusiness.Withoutit,youarenotdoingtransformation.

Copyright A

BPM


307

Businessesevolvetowardmediocrityovertime.Constantsmallchangesandthefactthatchangehashistoricallybeenorganizationallylimitedcauseprocessestobecomeunorganized,weakandineffective.Theyareoftenbrittleandbreakeasily.Improvingthemhashelpedbyputtingnewpatchesontheoldones.

Butlittlehashappenedtomakethemservethecustomerbetterormakethecompanymorecompetitive.Eventually,theoperationstartstobreakdownand“whitespace”manualworkaroundeffortbecomescommon.Atthispointtheoperationisbroken.Itmayoperateandworkwillbedone,buttheefforttomakeitworkisextraordinaryandtheriskofanychangeishigh.

Transformationisanewlookattheprocessesandthecompany.Itisaboutthinkingbig,unfettered.Anditisaboutchangingatalllevels(process,subprocess,businessunit,andworkflow)simultaneouslyinawaythatlooksforthebestwaytoservethecustomerandthenworksinwardfromthecustomerinteractiontooptimizehowtheprocesseswork.Thisperspectiveisoftennewtocompanieswhoareusedtolookinginwardtoimprovingtheoperationanddrivingoutcostbyimprovingefficiency.

Example:Howmanypeopleliketocallcompaniestoorderorrequestsomething,whentheyarelikelytospeaktosomeonetheycan’tunderstandandwhoreallycannothelpthem?Howmanypeoplereallylikecallingtotalktoacomputerthatgivesthemfivechoices—noneofwhichseentobetheonethatwillhelpthem?And,howmanylikegoingthroughthelayersofautomatedquestionstoplaceanorderorfindinformation?I,forone,gorighttothe‘talktosomeone’option.

Asastartingpointinanytransformationdesign,putyourselfinthecustomer’sposition,notinyourcompany’sposition,andeliminateallthethingsyouandtheprojectteamhatewhendealingwithacompany.Thatisagoodstartingpoint.Thenworkinwardtoeliminatewhatyouhateandcorrectthedeficienciesthatstopinteractionthewayyouwouldliketodoit.

Focusgroupsandcustomerquestionnairesaregoodtoolstohelpinthisdefinitionofinteractionproblems.Althoughthecustomerperspectiveisonlyoneofmanydrivers,itisanimportantoneanditaffectsalllevelsofthenewdesign.

7.5.5 Performance monitoring and feedback to solve problems

Mostcompanieshavesomeformofmanualandautomatedperformancemonitoringandreporting.Butthequestionthatmustbeaskedis,doesitmeasuretherightthings?Muchofthereportingincompanieshasevolvedoveragreatmanyyears.Peoplejustkeepgettingthereportsand,whenasked,acknowledgethatmanyareuselessorprovidealimitedamountofinformation.Butitissooneroustochangethesereportsinmostcompaniesthatbusinessmanagerslivewithwhattheyhave.

Duringanytransformation,thissituationmustbereviewedandchanged.Reportingmustbemadeuseful.Todothis,itmustbebuiltintothenewbusinessworkflowandmanagementdesigns.

Copyright A

BPM


308

Ifatraditionalapproachofcreatingrequirements/specsfromthenewdesignandgivingthemtoITtobuildapplications/interfaces,etc.,isused,thereportswillbebuiltfollowingthenormalITmethods.

IfaBPMSisusedtosupportthecreationofthenewtransformationbusinessdesign,itwillbepossibletogenerateperformance‐monitoringcapabilitiesfromboththepartsofthebusinessthatwillexecutewithintheBPMS(seechapter10,BPMTechnology)andfromlegacyapplicationdata.ThisallowstheBPMSoperationtomonitoractivityandthenanticipateoutcomesbasedongivenrules.Withthisability,managershaveanewlevelofperformancemonitoringandreporting.

Transformationisachancetorethinknotonlywhatinformationreallywillbehelpful,butalsohowitshouldbedelivered—paper,reportsdeliveredonscreens,orsummariesonautomateddashboards.AllhaveaplaceandtheoptionsaregrowingwithiPads,smartphones,etc.ThekeyistounderstandeachoptionandthenworkwiththebusinessusersandITtodefinetherightoptionsfortheneeds.

Throughthisapproach,itisnowpossibleformanagerstokeeptrackofwhattheyareinterestedinmonitoringandtoinstantlysendguidanceasalertsandwarningsarereceived.Thetechnologyisdeliveringnewcapabilities,andbothperformancemonitoringandmeasurement(evaluation)cannowprovidenewwaystodeliverinformationandreacttoit.

7.5.6 Delivering flexibility and speed of change: Arguably more important than savings (strategic use of BPMS/BPM vs. tactical short‐term benefit)

UsingaBPMSinatransformationprojectisacommitmenttothetoolandtheapproach.ThenewdesignwillexecutewithintheBPMS—itcannotbeseparatedfromit.So,usingitrepresentsastrategiccommitmenttothetoolandthechangesitsupports.Thereasonisthattransformationimpliesabroad‐basedchange,andwhatevertechnologyisusedwillaffectasignificantpartofthebusinessoperationandtheITinfrastructure.Becausetransformationandcontinuousimprovement(whichwillhopefullybeagoaloftheproject)requirelong‐termcommitments,thetechnologythatisusedrepresentsastrategiccommitmentinthebusinessareathat’stobetransformed.

ABPMSofferssignificantadvantagesovertraditionaltechnology.Theadvantagethatisatruegamechangeristhegenerationofapplications.TodayBPMStoolshaveevolvedtothepointwheretheycangenerateindustrial‐strengthapplications(seechapter10,BPMTechnology).OthertechnologythatinterfaceswiththetypicalBPMScanofferadditionalspeedinlegacy‐applicationinterfacingandweb‐servicedesign/delivery.Togethertheyprovideanabilitytochangeveryfastbymodifyingbusinessmodelsandrules,redefiningformsthatdesignscreensandreports,andthenregeneratingapplications.

Thisabilitytoregenerateapplicationsisthefoundationforiterativedesignandtesting.Whetherthedesignissimplyiteratedwithbuilt‐inperformancemonitoringthatprovidesresultsreportsoriteratedusingasimulationmodeler,thebottomline

Copyright A

BPM


309

isthattheBPMS‐supportednewbusinessoperationcanchangequicklyandwithlimitedrisk—foralowcost.

ThisisthetrueadvantageofaBPMS.

7.6 Sustaining Optimization

Transformationisthefirststepintoanewoperatingfuture.Itisnotthelastone.Beyondtransformationliescontinuousimprovement.

Traditionally,onceamajorchangehasoccurred,managementbelievesthatthebusinessoperationcanbeleftaloneforaconsiderabletime.InBPM,thatperspectiveneedstochangetoadoptapolicyofcontinuousimprovementinallareasthathavebeentransformed.

Onceoptimized,thetrickistosustainanoptimallevelofperformanceasthebusinessandthemarketchange.Inchapter5,theEvolutiveManagementconceptwasintroduced.Thisisanapproachthatrecognizesthatthebusinesswillevolve.Thereisnoquestionaboutthat:thequestioniswhetheritwillevolvethroughmanagementdirectionorsimplyevolveuncontrolled,withmanagementplayinganunendingcatch‐upgame.

Transformation,ifperformedtherightway,willhaveeliminatedproblems,waste,andcost,whileevolvingthebusinesstosupportfasterresponsetomarketopportunitiesandlegislativerequirements.Insomecases,performancemeasurementandreportingwillhavebeenputinplacetohelptheoperationfindandfocusonsmallerchangesasitmovesfromtransformationintoanewoperation.Ifcontinuousimprovementisadopted,managementwillonceagainfocusonimprovementtoresolveproblemsandaddressmarketandlegislatedrequirements,inthemovetosustainthestateofoptimization.Thisgoesfarbeyondfocusedimprovementandmovestheoperationtoanenvironmentofcontinuousevolutionwiththegoalofsustainingastateofoperationaloptimization.

Butbecauseoptimizationisamovingtargetwithaconstantlychangingsetofcharacteristicsandvalues,itshouldberealizedthatoptimizationcanneverbemaintainedforlong.Thebusinessenvironmentinwhichcompaniesoperatechangesconstantly.Becausethechangesaredifferentallthetime,theyconstantlyaffectdifferentpartsofthebusiness—attimeseventhosethathavebeentransformed.

Thismeansthat,toapproachoptimization,thebusinessmustbeabletochangequicklyenoughtoadjusttoavarietyofdriversandeventsinamatterofdaysoratthemostweeks.Inthisreality,optimizationmaybeachieved,butitwillbeafleetingvictory,forassoonasitisachieved,thecompanywillneedtochangetokeepupwiththenextchangeinthechangingbusinessworld.

Tokeeppace,thecompanymustadoptaposturethatpromotescontinuousevolution.Herethebusiness,oncetransformed,neverstopschanging.Inthisenvironment,theabilitytochangequicklyismoreimportantthananysingleoutcomeorchange.Thereasonisthatanyoutcomewillbevalidonlybrieflyandthe

Copyright A

BPM


310

businesswillneedtomovetothenextiterationofitsoperationasquicklyandwithasmuchcontrolaspossible.ThistypeofconstantevolutionwasnotpossiblebeforeBPMS‐supportedBPM—itsimplytookITtoolongtochangeapplications.

WiththeabilityofaBPMStogenerateapplications,thepastconceptofcontinuousimprovementischangingtosupportcontinuousiterativebusinesschange.ButBPMS‐supportedBPMisonlypartoftheanswer.

Businesstransformationcansetthestageforanewbusinessapproach—oneofconstantevolutiontooptimization.ThiswillrequireanewunderstandingofwhatBPMS‐supportedBPMnowallowstobepossible.Thechallengetothetransformationteam,theBPMCoE,andtheBPMindustryistohelpmanagementunderstandthisnewapproachandtoadoptit.

7.6.1 Commitment to continuous improvement

Wheneverythingisgoingwell,theoperationhasbeentransformed,andthelevelofperformanceapproachesoptimization,itiseasytoforgethowthathappenedandtoughtobecommittedtomaintainingthatlevelofservice.

Example:Amajorhealthinsurancecompanyimplementedatransformationeffortinclaimsprocessing.Thepeopleonthetransformationteamweretrainedandmanagementwascommitted.Theeffortachievedallgoalsandexceededexpectations.Theprojectteammemberswerepromotedandeitherranorassistedmanagersinrunningthetransformedareas.Thingsweregreatforseveralyears.Improvementswerefoundandmadeandtheoperationwasfairlyoptimal.Butastheoriginaltransformationteammembersweregivendifferentjobsorleftthecompany,thecommitmenttocontinuousimprovementbecamelessandless.Finallyattheseven‐yearmark,thebusinessoperationwasonceagainoperatingatamediocrelevelandwasintrouble.

Giventheinvestmentintransformation,continuingtoinsistonaprogramofcontinuousimprovementjustmakessense.Butthiscommitmentmusttranscendanyindividualoritwillslowlybelostasnewpeoplereplacethosewhounderstandwhatthecommitmentgivesthem.

7.6.2 Evolving the process

Asthebusinesschanges,sowillitsneeds.Asnoted,thesechangeswilldrivecontinuousimprovement,butitwillbeattheimprovementlevelandnotatthetransformationlevelofchange.Formostthingsthatwillbefine.However,thebusinessmustevolvewiththeindustry,themarketplace,advancesinITtechnology,advancesinproductiontechnology,newproductsthatthecompanywilloffer,andmuchmore.Atsomepoint,thesedriversmaybesosignificantthatanothertransformationwillbeneeded.Thistransformationwillbedifferentfromthefirst,whichcreatedthecurrenttransformedoperation.

Inthefuture,thetransformationswillbearedesignwithawiderscopethantheimprovements.Themodels,rules,forms,andotherinformationwillbeintheBPMSandtransformationwillsimplybeabiggerimprovementeffortwiththefocusof

Copyright A

BPM


311

radicallyrethinkingthebusinessbasedonthedrivers.Disruptionshouldbemuchlessandriskmuchlower.Everythingwillbeinplaceandreusable.Thiseliminatestheprojectstart‐up“AsIs”modelingandstartswithsimulation‐basedredesign.

ABPMS‐basedBPMenvironmentisdesignedtochangeandhelpthebusinessevolve.Caremustbetakeninputtingthepeopleandreportinginplacetodirectandcontrolthisevolution.

7.6.3 Continuous improvement

Oftentoutedandseldomtrulydelivered,continuousimprovement,whenperformedinaBPMS‐supportedBPMenvironment,becomesfeasibleandbeneficial.

Theproblemwithpastattemptsatcontinuousimprovementhasnotbeenwiththeidentificationofaneedortheredesign.SixSigmaandotherevaluationtechniqueshavebeenmostlysuccessfulinidentifyingtheneed,andLeanandotherimprovementtechniqueshaveproducedgoodnewdesigns.And,applyingthesetechniquesattheimprovementlevelseemstoworkmuchbetterthanatthetransformationlevel.Sotheyarebeingappliedattherightlevelintryingtoproduceimprovement.

Theproblemcomeswiththecreationandimplementationofthechanges.Thisproblemistiming.Todayinmostbusinessenvironments,changestakealongtime—especiallywhenthechangeinvolvesITandchangingapplicationsorbuildingnewones.Becausethebusinessneedischangingquickly,ithasbeendifficultorimpossibleformostcompaniestobuildandimplementchangesquicklyenoughforthemtobeeffectiveinmovingtowardoptimization.

Clearlyanychangethattakesmonthsorlongerfromthetimeitisrequestedtothetimeitisdeployedwillbeoutofdatewhenitisdelivered.TheproofofthisisintherequestsforfurtherchangesthataccompanythedeliveryofmostITsupport.

Continuousimprovement,tobeeffective,mustbecapableofdeliveringveryfastchangesthatincludethebusinessoperationandIT.Buildingthisenvironmentispartofacommitmenttocontinuousimprovementbecauseitcanbereusedbyanypartofthebusiness.BuildingitrequiresaBPMStoolandacommitmenttoarchitectingtheITinfrastructuretoopendataaccessandincreasethespeedofdeliveringapplicationsandinterfaces.Italsorequiresacommitmenttoinvestigatingandadoptingnewtechnologyandnewbusinessapproaches.

Whenthisisinplace,truecontinuousimprovementcanbeputintooperation.

7.7 Key Concepts

Transformationisthefundamentalrethinkingofthebusinessoperation.

Transformationisbothinvasiveandpervasive,andisbothalargeandexpensiveproject.

Thescopeandlevelofchangeintransformationrequiresskillsfrommultipledisciplines.

Copyright A

BPM


312

Tocontroltransformation‐levelprojects,theworkshouldbeguidedbyaformalmethodology.

Transformation‐levelprojectsshoulduseaBPMSandfollowaBPM‐basedapproach.

Transformationprovidestheopportunitytomovethebusinesstocontinuousimprovement.

Tosucceed,transformationrequirestheinvolvementandsupportoftheexecutiveteamandthebusinessmanagersandstaffwhowillbeaffected—inscope.

Fundingisalwaysprobleminlargeprojects.Thetransformationcanbedesignedasawholeanddeployedinhigh‐profile,high‐benefitpartsinordertostartrealizingbenefitsooner.

Changemanagementmustbeconsideredtohelptheprojectwinbusinessmanagerandstaffacceptance.

Aformal,butevolving,changemanagementplanshouldguidetheapproachandstaffinteraction.

Performancemonitoring,measurement,andevaluationshouldbebuiltintothenewbusinessdesignwiththeinvolvementofthebusinessmanagersandstaffwhowillbemonitored.

Theendofthetransformationisthebeginningofthecontinuousimprovementcycleforthetransformedbusinessoperationandprocess.

Transformationandcontinuousimprovementwillchangecultureandshouldcreateapartnershipbetweenmanagementandstaffforfuturechange.

Managementshouldbecommittedtoinnovationand“outsidethebox”thinkinginthetransformation.

Copyright A

BPM

P International

Chapter 8

Process Organization

Copyright A

BPM

P InternationalChapter8.ProcessOrganization

314

Foreword by Andrew Spanyi, Managing Director, Spanyi International Inc.

Thischapteraddressessomeofthekeyorganizationalfactorsthatarerelevantasacompanymovestowardsbecomingacustomer‐focused,process‐centricenterprise.

Theprincipalconceptisthatanorganizationneedstointroduceandsustainaccountabilityfortheflowofworkthatcrossestraditionalorganizationalboundariesincreatingvalueforcustomersandthecompany.

Therelevantorganizationalapproachestypicallyincludechangesinworkprocesses,organizationalstructure,rolesandresponsibilities,performancemeasures,valuesandculture.Thechangesinorganizationalstructuredonotreplacetraditionalstructuresbasedonfunctional,geographic,orproductdisciplines.Instead,aprocessorganizationrepresentsanoverlayonatraditionalorganizationdesignintendedtocreategreateremphasisoncustomerfocusandprocessorientation.

ChangesinorganizationstructurethroughtheintroductionofrolessuchasprocessownershipandaBPMCenterofExcellenceneedtobesupportedbytherightmodels,measures,improvementmethods,andalignedrecognitionsystems.Simple,visuallycompellingandrelevantprocessmodels,customer‐focusedmeasures,integratedimprovementmethods,andalignedrecognitionsystemsallservetoshiftcompanyculturefromahierarchicalviewtoacustomer‐focused,process‐basedview.

Theroleofmeasurementiscrucialinthisregard.Process‐orientedcompaniesmeasurewhatmatterstocustomers.Themostcommonofthecustomer‐focusedmeasuresincludeperfectorderdelivery(asdefinedbyTheSupplyChainCouncil),perfectnewproductintroductionandfirst‐time‐rightresponsestocustomerinquiriesandcomplaints.

Establishingaccountabilityforprocessperformanceisanothercornerstoneofacustomer‐focused,process‐centricenterprise.Inspiteoftheexistingliteratureandnosmallamountoffanfarearoundtheimportanceofprocessownership,organizationsoftenstumblewithsuccessinprocessownershipinsomeorallofthefollowingways:

Processownersareappointedatmiddlemanagementlevelswithresponsibilityforprocessesofsmallscopeandarenotsupportedbyexecutiveprocess‐ownerappointmentsfortheimprovementandmanagementofthefirm’send‐to‐endprocesses

Thereisalackofadequateandcontinuingtrainingfor,andeducationon,theroleoftheprocessowner

Theroleoftheprocessownerisdivorcedfromthefundamentalmanagementframeworkofthefirm,andprocessownerslackaclearvoiceinmakingdecisionsaroundresourcesandpriorities.

Anintegratedapproachtoimprovingperformancethroughacustomer‐focused,process‐basedviewoftheenterpriseisanotherkeyelementinbecomingaprocess‐

Copyright A

BPM


315

centricenterprise.Thisrequiresintegrationinthevariousimprovementmethodsusedbyanorganization,includingapproachessuchasLean,SixSigma,ContinuousProcessImprovement,Reengineering,andtechnology‐enabledBPMinitiatives.Whilesuchintegrationinvolvesagreaterinvestmentintrainingandgenerallyrequiresmoreeffort,theresultingbenefitscanbesignificant.

Thejourneytoenterprise‐wideprocessmanagementinvolvesthedefinitionofacompany’send‐to‐endprocesses(typically5to10),measuringperformancefromboththecustomer’sandthecompany’spointsofview,designatingprocessownerswithresponsibilityandaccountabilityforprocessperformance,selectingtwoorthreeprocessesforimprovementaction,capturingearlywinsineachselectedprocess,andsustaininggainsthroughongoingmanagementofthefirm’send‐to‐endprocesses.Thiscycleisthenrepeateduntiltheentireoperationsofthefirmhavebeenoptimized.

Copyright A

BPM


316

Contents

ForewordbyAndrewSpanyi,ManagingDirector,SpanyiInternationalInc........314

8.0 Introduction..........................................................................................................................317

8.1 TheProcess‐DrivenOrganization................................................................................317

8.1.1 ConsiderationsinManagingPrimaryProcesses..........................................317

8.1.2 ContrastsbetweenTraditionalManagementStructuresandtheProcess‐DrivenOrganization................................................................................................318

8.1.3 Rummler’sPerformanceMatrix...........................................................................318

8.1.4 PerformanceMatrixPresentsanIntegratedApproach.............................319

8.1.5 ResultsofDeployingaPerformanceMatrix...................................................319

8.1.6 ProcessCulture...........................................................................................................320

8.2 FromHierarchicalStructurestotheProcess‐DrivenOrganization..............320

8.2.1 HistoricalOriginsoftheTraditionalHierarchicalOrganizations.........321

8.2.2 ImpactofERPandERPSystemsonOrganizationalStructure...............321

8.2.3 ERPProcessesChangedBusinessestoProcessOrganizations..............323

8.3 ProcessManagementRoles............................................................................................323

8.3.1 ProcessOwner.............................................................................................................324

8.3.2 ProcessManager.........................................................................................................326

8.3.3 ProcessAnalyst...........................................................................................................326

8.3.4 ProcessDesigner........................................................................................................326

8.3.5 ProcessArchitects.......................................................................................................326

8.3.6 OtherKeyRoles...........................................................................................................327

8.4 GoverningBodies................................................................................................................329

8.4.1 ProcessGovernance..................................................................................................330

8.4.2 ProcessCouncil...........................................................................................................331

8.4.3 BPMOfficeorBPMCenterofExcellence..........................................................332

8.4.4 SettingUpaBusinessProcessManagementCenterofProcess.............333

8.5 ASummaryDiscussion.....................................................................................................335

8.6 KeyConcepts.........................................................................................................................335

Copyright A

BPM


317

8.0 Introduction

Eachbusinessisdifferent,andthenature,amount,andpaceofchangeinabusinessaredynamic.Abusinessprocessmanagementfocuschangesthewayexecutivesthinkaboutandstructuretheirinstitutions.Historically,mostcompanieshavebeenstructuredaroundfunctional,geographic,orproductdisciplines.Fewcompaniesarestructuredaroundtheirbusinessprocesses.Asinstitutionsreachnewlevelsofprocessmaturity,newskills,managementstructures,andwaystoalign,motivate,andrewardemployeesmaybeintroduced.Thischapterhelpsbuildanunderstandingofthenatureofwhatthesechangesmayinclude,sothatBusinessProcessManagementProfessionalscananticipate,plan,prepare,andguidethebusinessthroughthetransitiontoaprocess‐drivenenterprise.Thesechangesinclude

Organizationalapproachestoconsiderasbusinessesintroduceandmatureinthedisciplineofmanagingtheirbusinessprocesses.Changingorganizationalapproachescanbechallengingandcanincludechangesinworkperformanceprocesses,organizationalstructure,rolesandresponsibilities,performancemeasures,values,andculture.Essentially,everythingaboutthecompany,perhapsevenhowitdefinesitself,issubjecttochange.

LessonslearnedfromimplementingEnterpriseResourcePlanning(ERP)systems:howorganizationshavebeenaffected,leadingsometobecomeprocess‐driven.

Specificrolesandresponsibilitiesplayedbyindividualsinaprocess‐drivenorganization.

Process‐specificgoverningbodies,whichleadtosuccessfulprocessimprovementimplementations,accordingtofieldpracticeandresearch.

DevelopingaBusinessProcessManagementProcessCenterofExcellence(BPMCOE).

8.1 The Process‐Driven Organization

Theprocess‐drivenorganizationisanenterprisethatisstructured,organized,managed,andmeasuredarounditsprimarybusinessprocesses.

8.1.1 Considerations in Managing Primary Processes

Manycompaniesdiscoverthattobeeffectiveinmanagingtheirprimarybusinessprocesses,theymustassignclearlydefinedaccountabilityforthedesign,documentation,maintenance,upkeep,andlong‐termhealthoftheseprocesses.Newroles,responsibilities,relationships,andorganizationalstructuresmaybecontemplated.Thisoftenleadstoasignificantchangeinmanagementfocusandthewayworkisperformed,developingfromamoretraditionalstructure,focusedona

Copyright A

BPM


318

particularresourceorbusinessfunction,tothecross‐functionalperformanceoftheend‐to‐endprocessesthatdelivervaluetocustomers.

8.1.2 Contrasts between Traditional Management Structures and the Process‐Driven Organization

Traditionalmanagementstructuresinvolvehierarchicalresourcemanagementthatdelegatesresponsibilityfromonelevelofmanagementtothenext,withultimateaccountabilityassignedtotheorganization’sindividualstakeholders.Thisdelegationisexpressedasadownwardmanagerialfocusoncommandandcontrolofindividualworkerswhohaveresponsibilityforspecificsetsoftasks.

Incontrast,process‐drivenorganizationsassignaccountabilityhorizontally,toallfunctions,fordeliveryofvaluetothecustomer.Processfocusinvolvesprocessdesign,documentation,measurement,andcontinuousimprovement.Ratherthancommandandcontrol,processmanagersmayfindthemselvescoaching,advocatingfor,andsupportingagroupofprofessionalswhoactuallyperformorexecutetheprocess.

Aprocess‐drivenorganizationdoesnotmeanthatprocessistheonlydimensionofmanagement,performancemeasurement,ororganizationalstructure.Anintegratedapproachtoperformanceimprovementmusttakeintoaccounttheorganizationasawhole,inclusiveofprocessandtheroleoftheindividualwithrespecttotheprocessandtheorganization.AlthoughthisconcepthasbeendiscussedindepthinIMPROVINGPERFORMANCE:HOWTOMANAGETHEWHITESPACEINTHEORGANIZATIONCHART,byGearyA.RummlerandAlanP.Brache,itcannotbeemphasizedenoughthatthisisthefundamentalpremisebehindtheprocess‐drivenorganizationandtheorganizationalstructuresthatsupportit.

8.1.3 Rummler’s Performance Matrix

Rummlersuggestedusingaperformancematrixtoillustrateandintegratethemultiplelevelsofanorganizationanditsconcerns.Thisisa3by3matrix(seeTable24)thatcoversthescopeoftheapproachandindicatesthethreelevelsofanorganizationandtheconcernofeachlevel.4

LevelofOrganization ConcernatthisLevel

Organizational Theorganizationasawhole

Process Thespecificprocessestheorganizationusestoaccomplishwork

JoborJobPerformer Concreteactivitiesthatpeopleandsystemsperform

Table24.Concernsat3levelsoforganization

4Thisisanotherexampleoflevelsofanorganizationandprocessespreviouslydiscussedinchapter3,onprocessmodeling.

Copyright A

BPM


319

8.1.4 Performance Matrix Presents an Integrated Approach

Ateachlevel,theassumptionisthatorganizations:

Definegoalsandmeasures,andcreatedesignsforachievingtheirgoalsandmeasures,and

Establishmanagementpracticesthatassurethatthedesignsachievethedesiredgoalsandmeasures.

Thetablebelowillustratestheconceptofanintegratedapproachtoperformanceimprovement.Theprimarypointisthatthematrixstressesanintegratedapproachandthedynamicinteractionamongallthelevelsandtheninevariablesinthematrix.

Level Goals&Measures Design&Implementation Management

OrganizationalLevel

OrganizationalGoals&MeasuresofOrganizationalsuccess

OrganizationalDesign&Implementation

OrganizationalManagement

ProcessLevel ProcessGoals&MeasuresofProcesssuccess

ProcessDesign&Implementation

ProcessManagement

Job/PerformerLevel

Job/PerformerGoals&MeasuresofSuccess

JobDesign&Implementation

Job/PerformerManagement

Table25.Rummler'sPerformanceMatrix5

8.1.5 Results of Deploying a Performance Matrix

Organizationsthathaveputintopracticetheconceptoftheperformancematrixhavemadeasignificanttransitioninthetransformationtoaprocess‐drivenenterprise.Acknowledgingtheroleofprocessinanorganizationseemstrivial,butintegratingprocessintotheorganization’sgoalsandmeasuresandintegratingtheindividual’sperformanceintotheprocessandtheorganizationallevelsisnottrivial.Often,thefunctionalrolesandresponsibilitiesconflictwithintherealmofthePerformanceMatrix.Financial,market,andotherperformancemeasuresremainimportant,asdofunctionalandproductskills.Someorganizationsmayleveragehybridstructures,whichincludeaprocessdimensioncombinedwithfunctional,

5ImprovingPerformance:HowtoManagetheWhiteSpaceintheOrganizationChart,

GearyA.Rummler,AlanP.Brache,1995

Copyright A

BPM


320

product,market,orgeographicdimensions.Othersmaytakeamoreaggressiveleap,structuringthemselvesalmostentirelyaroundprocesses.

8.1.6 Process Culture

A“processculture”existswhenthebusiness’sprocessesareknown,agreedon,communicated,andvisibletoallemployees.Characteristicsofaprocessculturespecificallyinclude

Generalagreementonwhatthebusinessprocessesare Understandingofhowbusinessprocessesinteractandaffecteachother Cleardefinitionofthevalueeachprocessproduces Documentationofhoweachprocessproducesitsresults Understandingofwhatskillsarerequiredforeachprocess Understandingofhowwelleachprocessperforms Ongoingmeasurementofprocessperformance Managementdecisionsbasedonprocessperformanceknowledge Ownersofeachprocesshavingaccountabilityforprocessperformance Organizationsthatorientthemselvestoprocessunderstand Theneedtochangetheirmanagementapproachtoincorporateprocess,and Therolestomanageprocessintheirorganizationalstructures.

8.2 From Hierarchical Structures to the Process‐Driven Organization

Thelegacyofmanagerialstructuresinfunctionallyorientedcompaniesistypicallyadepartmentalhierarchy,wheremanagersareresponsibleforworkersperformingtasksrelatedtoaparticularresourceorbusinessfunction.Groupsofworkersarecombinedintodivisionsordepartments,eachaddinglayersofmanagementandcontrol.Inlargeenterprises,thesedepartmentsareoftengroupedbyproduct,market,orgeography.These“silos”ofresourcesarerepresentedonacommonandfamiliarorganizationalchart,asinFigure58.

Figure58.OrganizationalChart(example)

Copyright A

BPM


321

8.2.1 Historical Origins of the Traditional Hierarchical Organizations

Therearemanyproblemswiththetraditionalverticalorganizationalstructures.However,atonetime,thesestructuresworkedbecausethatwashowtheactualworkwasstructured.ThebestexampleofthisistheearlydaysofautomanufacturingwhencompanieslikeFordwereverticallyintegratedandeveryemployeewas“specialized”todotheworkoftheirparticulararea,whetherontheassemblylinesorincastingsteelforautos.Measurementswereatthejoblevel,expressedasoutputof,forexample,unitsperday.RelatingthistoRummler’sperformancematrix:

Thejobperformeroutputwasunits/day, Theverticalprocess(functionalorientation)wasmanufacturing,and Theoutputwastranslatedintorevenueandcostsontheincomestatement.

8.2.2 Impact of ERP and ERP Systems on Organizational Structure

Ascompanygrowthstrategieschanged,sodidlaborstrategies.Thede‐verticalizationofmanyindustriesledtodifferentorganizationalstructuresandbusinessmodels.Whathadn’tchangedforeverycompanywasthefunctionalorientationandapproachtoworkinorganizations.Itwasn’tuntiltheadventofEnterpriseResourcePlanning(ERP)systemsinthemid1990’sthatorganizationswereforcedtoconsidertheirorientationtoprocess.ERPsystemsofferedastandard,integratedalternativetotheexistingfunctionalprocessesbytransactinghorizontalprocessesthatwereenabledthroughtheERPtechnology.TherearemanystoriesandexamplesofcompaniesthatinvestedalotofmoneyonERPimplementationswithcorrespondinglyhighfailureratesforERPimplementations,butthefactremainsthatthetransformationimposedbyERPsystemswasoneofprocessandnotoneoftechnology.Companiesthatwerehugelysuccessfulweretheoneswhotookaprocess‐orientedapproachtothetransformation.TheimportantpointtonoteisthatERP,likeitornot,wasatechnologydisruption‐pointthatforcedcompaniestobemoreprocessoriented.ERP,byitsverynature,demandshorizontal,cross‐functionalprocessessuchasprocure‐to‐pay,order‐to‐cash(orderfulfillment),concept‐to‐product(productdevelopment),andrecruit‐to‐retire(humanresourcesmanagement)intovaluestreamsthatrequirehorizontalmanagement.Table26listsexamplesofvaluestreamsandthetypicalERPcross‐functionalnames.ERPsystemmodulestypicallytakeonthecross‐functionalnamesprovidedbythevendor.

ValueStreamsTypicalCross‐FunctionalNames

ProspecttoCustomer CustomerEngagement

OrdertoCash OrderFulfillment

ManufacturingtoDistribution Operations&Logistics

Copyright A

BPM


322

ValueStreamsTypicalCross‐FunctionalNames

RequesttoService CustomerService

InsighttoStrategy StrategicPlanning

VisiontoeBusinessEnterprise EnterpriseManagement

ConcepttoDevelopmentR&D,Product&ServiceEvolution

InitiativetoResults ImplementationExecution

RelationshiptoPartnershipStrategicPartnering&Outsourcing

ForecasttoPlanBudgeting,Outlooks&Forecasting

RequisitiontoPayablesProcurement/VendorManagement

ResourceAvailabilitytoConsumption ResourceManagement

AcquisitiontoObsolescence FixedAssetManagement

FinancialClosetoReporting Finance&Accounting

RecruitmenttoRetirement HumanResourceManagement

AwarenesstoPrevention Quality&SafetyManagement

Table26.Cross‐functionalnamesgiventovaluestreams

Copyright A

BPM


323

8.2.3 ERP Processes Changed Businesses to Process Organizations

Figure59.Cross‐functionalrelationshipsinanend‐to‐endprocess

SinceERPprocessesare“pre‐designed,”itwasn’tlongbeforemanagementofacompany’scorebusinessprocessestransitionedtoanew,horizontalfocusintheorganizationstructure.Thesecross‐functionalprocessesrequiredaneworganizationalorientationinwhichaccountabilityandownershipofprocessperformanceneededtobeexplicit(seeFigure59).Theadditionofnewresponsibilitiestoexistingroleswithinfunctionalorganizationscreatedaprocessdimensiongovernedbytheroleofaprocessowner.

IntermsofRummler’sperformancematrix,thisnewrolerequiresintegrationofthejoborjobperformerintothehorizontalprocess.Forexample,ordertocashnecessitatesateamorientationtotheprocesswheremultiplejobsandjobperformersareupanddownstreamtoeachotherbeforethefinaloutputisdeliveredtothecustomer.

8.3 Process Management Roles

Process‐drivenorganizationsinallstagesofdevelopmentincludeindividualswhosupporttheexecutionofprocessimprovements:

Processowners Processmanagers Processanalysts Processdesigners Processarchitects

Copyright A

BPM


324

Businessanalysts Subjectmatterexperts Executivesponsors ITprofessionals Changemanagementprofessionals.

8.3.1 Process Owner

Aprocessownerhastheongoingresponsibilityandaccountabilityforthesuccessfuldesign,development,execution,andperformanceofacompleteend‐to‐endbusinessprocess.Processownershipcanbeafull‐timeresponsibilityoranaddedresponsibilitysuchasalineorstafffunction.

Characteristics and Responsibilities of Process Owners

Somecompaniesmaylabeltheprocessownerroledifferently.Forexample,titlessuchasprocessleader,processmanager,andprocessstewardareoftenused.Inadditiontothetitle,thesubstanceofthisrolemayalsovary.Processownersarelikelytobeindividualsatanexecutivelevel,typicallyVPorhigher,whohavecommonresponsibilitiesacrossverticalsilos.Theymayhavedirectorindirectauthorityoverstrategy,budgets,andresources.Theirscopeofresponsibilitymayvary.

Processownersusuallyarethoseconcernedwithend‐to‐endbusinessprocessesthatdirectlydelivervaluetothecustomersoftheorganizationandhaveenterprise‐levelresponsibilityfortheperformanceoftheprocessasitrelatestoandimpactsthebalancesheetandincomestatement.Dependingonthetypeofprocess—forexample,recruitmenttoretirement—theymaybe‘supportprocess’ownerswhoareconcernedwiththeprocessesthatsupporttheorganization’sprimarybusinessprocesses,suchashumanresources,financial,orinformationtechnologyprocesses.Theymaybesubprocessownersconcernedwithsub‐componentsofanoverallend‐to‐endbusinessprocess.

Theprocessownerroleusuallyinvolvesotherduties,suchaschairingtransformationefforts,integratingprocessresultswiththoseofotherprocessowners,advocatingforprocesspriorities,benchmarkingprocessperformance,orcoachingprocessperformers.Processownersmayalsohaveotherrolesintheorganization,suchasfunctionalordepartmentalmanagement.Whateverthetitle,authority,orscopemaybe,allprocessownersshareauniqueaccountabilityforabusinessprocess.

Some common characteristics of process ownership include:

Accountabilityandresponsibilityforprocessdesign—Processownersmaysharedecisionrightsrelatingtotheprocessdesignwithothermanagersorparticipants.However,theyareaccountablefortheoverallintegrityandintegrationoftheprocessdesign.Processdesignmaybeiterative,withagoalofcontinuous

Copyright A

BPM


325

improvementinvolvingincrementalimprovementstotasksandactivities,oritmayrequireredesignoftheentireend‐to‐endbusinessprocess.

Accountabilityforprocessperformance—Processownersmaymanagetheprocess,i.e.,howworkgetsdone,butnotnecessarilythepeoplewhoperformthework.Managingprocessperformanceinvolvesdevelopingastrategyfortheprocess,settingperformancegoalsandobjectives.Itincludesensuringthatresourcesandskillsareinplace,measuringandcommunicatingactualperformanceagainsttargets,andusingthisfeedbacktocontinuouslyresetgoalsandobjectives.Processownersinitiateprocesstransformationeffortsanddefineincentives,whichensurethattheprocesscontinuestodelivervaluetoitscustomers.

Advocacyandsupport—Inordertoensurethatproperresources,training,incentives,andexecutiveattentionareallotted,processownersmayneedtomanagecommunicationsandadvocatefortheprocessesundertheircarewithexecutivemanagement,customers,suppliers,participants,andotherinternalandexternalstakeholders.Theymayfindthattheymustoperatethroughinfluenceratherthanauthority.Inevitably,eventhemostprofessionalandsuccessfulteamsencounterproblemswitheachother,unanticipateddemands,exceptionalcircumstances,designproblems,orchangingcustomerrequirements.Asprocessownerscontinuouslymonitorresults,theymustalsoinvestigateandresolveproblems.

First Process Improvement Projects Can Generate a Process Owner

Inorganizationswhoseprocessculturesarelessmature,thefirstappearanceofaprocessownercouldbeaprojectmanagerresponsibleforaprocessimprovementeffort.Theseindividualstypicallyhaveresponsibilityforaprojectoutcome,suchasimprovementtoabusinessprocess,butlackdirectcontroloverresources,policies,andbudgets.Nonetheless,theprojectmanagerisresponsibleforgainingcooperationamongmanydisparategroupswithintheorganization,adheringtothedefinitionofprojectdeliverymethodology,designingandimplementingtheprocesses,andmanagingchangetoachieveanoverallprocessimprovement.Throughouttheprojectdeliveryprocess,projectmanagersmaymonitorandcontrolprocessoperationstoensurethatthescopeoftheprojectconformstotheprojectobjectives.Projects,however,aretemporaryendeavorswithdiscrete,finiteoutcomesanddeliverables.

Organizationswhoseprocessculturesaremorematurehaverealizedthatprocessmanagementrequiresongoingsupport,maintenance,andnurturing;theyinstituteaprocessownerasacriticalandpermanentcomponentofanenterprise’sorganizationalstructure.

Copyright A

BPM


326

8.3.2 Process Manager

Aprocessmanageractuallyperformsandcoordinatestheworkonaprocessorprocesses.Processmanagersareinvolvedinmeasuringandmonitoringprocessmetricsanddrivingcontinuousprocessimprovement.

Process Manager Responsibilities

Theprocessmanagerbearsaccountabilityandresponsibilityforprocess

Performance,efficiencyandquality Supplyofthenecessaryresources Controlbyprioritizing,controllingandescalatingprocessneeds Co‐ordinationoftheindividualtasksandtheallocationofresources Resultsmeasurementandanalysis,and Implementationofrequiredchangesforimprovement.

8.3.3 Process Analyst

Processanalystsmanageprocesstransformationprojects,leadprocessdiscoveryanddesignworkshops,coachprocessowners,andmeasureandreportonprocessperformance.Processanalyststypicallyhaveagreatdealofskillindocumentingandunderstandingprocessdesignandperformancepatterns.Theyprovideanalysisandassessmentofcurrentprocesses,evaluatealternateprocessdesignoptions,andmakerecommendationsforchangebasedonvariousframeworks.Theirfindingsprovideinsightforprocessintegration,design,andstructure.Thisroleisoftencombinedwiththeroleoftheprocessdesigner.

8.3.4 Process Designer

Processdesignershavesignificantprocessknowledgeanddesignnewbusinessprocesses,transformexistingbusinessprocesses,andimplementplans.Designerstypicallypossessanalyticalandcreativeskillsaswell.Theyusevisualandmathematicalmodelstodescribeeachstepinaprocessandtheorganizationofwork.Aprocessdesignerensuresthattheprocessdesignalignsandcomplieswiththeoverallbusinessgoalsandpolicies.

8.3.5 Process Architects

Businessorprocessarchitectsmayfunctioninabusinessortechnologyrole.Dependingontheorientation,theymaybefocusedonmanagingbusinessperformanceoronmappingtechnologytobusinessoperations.Processarchitectsareresponsiblefor

Developinganenterprisebusinessarchitectureblueprint,alongwithcorrespondingvalue‐streamprocessmetrics

Ensuringalignmentamongbusinessneeds,businessarchitecture,andinformationtechnologyarchitecture

Copyright A

BPM


327

Developingandmaintainingarepositoryofreferencemodelsandstandardswithregardtoacompany’sproductsandservices,businessprocesses,performancemeasures,andorganization.

Processarchitectsareengagedinbusinessprocessanalysisandtransformationinitiatives.Theirinvolvementmaybefromastandardsandcomplianceperspective,ortheymayserveassubject‐matterexperts(SMEs)toadvisetheteamonthecompany’sprocessmethodology.Throughtheanalysisofbusinessprocessarchitecture,companiesidentifyopportunitiesformarketadvantage,businessintegration,andvariousinternalprocessinitiatives.

8.3.6 Other Key Roles

Business Analyst

Acommonroleinprocesschangeinitiativesisthatofbusinessanalyst(BA).BAsareresponsibleforanalyzingtheinformationandtechnologyneedsoftheirbusinessclientstohelpproposeinformationandtechnologysolutions.Theymayfacilitatemeetingstoassisttheprojectteaminanalyzingcurrenttechnologymappingortheymaybeinvolvedwithbusinessoperationsanddesigningnewinformationandtechnologyfunctions.Withinthesystemsdevelopmentlifecycle,theBAtypicallyperformsaliaisonfunctionbetweenthebusinesssideofanenterpriseandtheinformationtechnologydepartmentorexternalserviceproviders.Commonalternativetitlesarebusinesssystemsanalyst,systemsanalyst,andfunctionalanalyst.

Subject Matter Experts

Manyprocessimprovementprojectsorprocessmanagementteamsincludewhatiscommonlyreferredtoas“subjectmatterexperts”(SMEs).Theseindividualsaretypicallypeoplewhohaveadeepunderstandingofcertainbusinessfunctionsoroperations,oftenpossessingyearsofexperienceasaparticipantinbusinessoperations.Theyprovideinputonthecurrentprocessandassistindesigningnewprocesses.Theymayhaveinstitutionalknowledgeabouttherulesgoverningtheorganization’sprocesses,customerrequirements,ortheorganization’sculture.Theyoftenvalidatemodelsandassumptionsandaremembersofimplementationteamsastrustedstakeholdersprovidingchangeleadership.

Executive Sponsors: Management and Leadership

Theroleofexecutiveleadershipiscriticaltobusinessprocessmanagement.Theexecutiveleader(s)setthevision,tone,andpaceofbusinessprocessimprovement.Theydeterminethedirectionandstrategyofbusinessprocessmanagement,focusingtheenterpriseonitslargerobjectives.Theyallocateresourcesandrewardsuccess.Theymayunifythevariousmissionsandgroupsthroughouttheenterprise,andappointandempowerprocessownersorotherindividualsplayingkeyrolesinthemanagementofbusinessprocesses.

Executiveleadersmayevenbeprocessownersthemselves,owningandinstitutionalizingtheprocessofprocessmanagement.Theyactaschampionsinspiringtheenterprisetochange,sometimesbycreatingasenseofurgencyto

Copyright A

BPM


328

overcomeskepticismandresistance.Todothistheymustcommunicatethecaseforprocessmanagementandremoveobstaclesthatmayimpedeprogresstowardthegoal.Theyareresponsibleforcreatingtheenvironmentforsuccess,sometimesthroughinfluenceandpersuasion,othertimesbyresolvingconflictandremovingroadblocks.

IT Organization Roles

ThereareanumberofroleswithinInformationTechnologygroupsthatmayplayanimportantpartinbusinessprocessmanagement,including:solutionarchitects,systemanalysts,BPMSconfigurationspecialists,developers,databaseadministrators,andothers.Theseexpertshelpdefinesupportingtechnologysolutionsandmayassistindefiningnewcapabilitiesforbusinessprocessesbasedonenablingtechnology.Theyassistinprocesstransformationinitiativesthroughtheimplementationofnewtechnology,whileensuringthatthecompany’stechnicalstandardsareenforced.

Other Roles

Processownersrequirethesupportofateam.Supportingrolesmayinclude:design,architecture,mapping,modeling,toolmanagement,repositorymanagement,changemanagement,andothercriticalskills.TheABPMPcollaboratedinasurveythatidentifiedover100titlesandrolesintroducedbyorganizationsundertakingbusinessprocessmanagementinitiatives(seeFigure60).Differentorganizationsmayusedifferenttitlestodescribevariousroleswithsimilaroroverlappingresponsibilities.Often,asingleindividualprovidestheskillandleadershiprequiredfortwoormoreoftheseroles.SeveralchaptersinthisCommonBodyofKnowledgeprovideadditionaldiscussiononsomeoftheseroles.

Copyright A

BPM


329

Figure60.OnehundrednewBPMjobtitles

8.4 Governing Bodies

Asorganizationsmatureinthemanagementoftheirbusinessprocesses,issuesariseregardingprocessintegration,suchashowvariousprocessesmustjoinasacollectivewholetoensureasingle,coherentorganizationthatconsistentlydeliversvalueacrossallofthecompany’sprocesses.Theorganizationthusneedstoidentifynewmechanismsforplanning,budgeting,andallocatingresourcestoensurethatitsprocessesareproperlyresourced,integrated,andalignedwithstrategicobjectives.

Organizationsmusthaveacleargovernancestructuretoprovideleadershipandclarifydecision‐rightstoenablecross‐functionalanddepartmentalprocessimprovementormanagementprogramstosucceed.Often,therootofresistancetobusinessprocessmanagementinitiatives,sometimescausingthemtofail,ischangeintheorganizationalgovernancestructure.Individualswhomayhavehadagreatdealofpowerandcontroloverresourcesbaseduponorganizationalfunctions,productlines,orgeographicboundariesmayfindthattheirperformancemeasures,

Copyright A

BPM


330

authority,andspanofcontrolmustchangeinordertosuccessfullyimplementbusinessprocessmanagement.

Thereasonforchangeissimple.Businessprocessmanagementprovidesanend‐to‐endperspectiveonhowworkisdone.Thisend‐to‐endperspectivecrossestraditionalorganizationalboundariesandrequiresthatthemechanismsbywhichdecisionsaremadeandresourcesallocatedmustalsobealignedwiththeend‐to‐endbusinessprocess.Soundgovernanceprovidesastructureofauthorityandaframeworkforcollaboration.Thestructureandframeworkenableproperallocationofresourcesandefficientcoordinationofactivitycontrolthroughouttheorganization.Traditionalmanagerswhoareunabletoadapttheirthinkingbeyondtheirorganizationalsilotoend‐to‐endbusinessprocessmanagementarelikelytoresistinitiativesthatpotentiallychangetheirinfluenceintheorganization.

8.4.1 Process Governance

Thereisnosingle,standard,processgovernancestructurewidelyinuse.Organizationalfocusonprocessisstillemergingandavarietyofgovernancestructuresareinuseandevolving.Issuessuchasorganizationalstrategy,cultureandprocessmaturity,businessprocessoutsourcing,andeventhenatureofindividualleaderscancauseasignificantdeviationfromanygivengovernanceframework.

AccordingtoForresterResearch,“Businessprofessionalsholdthekeyto21stcenturybusinesstransformationasprocessskillsmigrateoutofITdepartmentsandintobusinessoperationgroups.SupplyChainisaperfectexamplewhere,dependingontheindustry,therearecriticalprocesseslikeOrdertoCash,ManufacturingtoDistributionandRequesttoService[that]haveexplicitownershipalongwiththeappropriaterolesandskillstomanageandimproveprocessperformance,whichdirectlyimpactsthetopandbottomlinesofcompanies.”

InformationTechnologyisanenablerintheSupplyChainexample,asitisinmanyotherprocessexamples.ThepartnershipbetweenthebusinessandITiscriticaltothesuccessofbusinesstransformationefforts.TherehavebeenmanystudiesintheERParenathathavelookedattheimportanceoffirstdesigningbusinessprocessesandimplementingthempriortoITimplementations.PanoramaConsultinghaspublishedanERPreporteveryyearforthelastthreeyearsandhasobservedthesameresultsacrossmultipleindustries.

The2010ERPreport(http://panorama‐consulting.com/resource‐center/2010‐erp‐report)mentionsthatmorethan67.5%ofERPimplementationsfailtorealizethebusinessimprovementbenefits.Accordingtothestudy,thebest‐in‐classcompanieswhorealizethebusinessbenefitsofERPtendtohavethefollowingbestpractices:

Exquisitefocusonthebusinessprocesses,thatis,identifyingtheprimary,management,andsupportbusinessprocesses,andthendefininganddesigningthemforoptimalperformance.Choosingthesoftwaretofittheprocessisthegoal,yetmostcompaniesgettootiedupinthetechnicalcapabilityofsupportingsoftwareandforgetaboutthebusinessprocess.

Copyright A

BPM


331

FocusonachievingahealthyROIbasedonbusinessperformanceandhavingabusinesscasethataddressespost‐implementationperformancemeasurement.

StrongcommitmentfromseniorbusinessexecutiveswithCIOorITalignmenttoacommonsetofgoals.

Adequatechangemanagementandtrainingforthenewprocessesandsystems.

8.4.2 Process Council

OrganizationsundertakingtheprocessjourneyshouldconsiderinstitutingaProcessCouncilorBusinessProcessManagementCenterofExcellence(BPMCOE)toaddressenterpriseprocessmanagementandperformanceissues.ResearchfrombothForresterandGartnerstressesthatsuccessfulcompanieshaveinstitutedBusinessProcessManagementCentersofExcellenceorProcessCouncilstoaddressenterprise‐levelprocessperformanceissues.“TheEAView:BPMHasBecomeMainstream,”fromForresterResearch(February19,2009),indicatesthat“…ofthecompaniesexperiencingclear,measurableimprovementduetoBPM,49%haveaCOE....[O]fthecompaniesthathadnosuccesswithBPM,4%haveaCOE.”

AProcessCouncil(seeFigure62)maybemadeupofacombinationofexecutiveleaders,functionalordepartmentalheads,andtheprocessownersofthecorecross‐functionalenterpriseprocesses.Itsmissionmayincludetheidentificationandresolutionofanycross‐processintegrationissues,conflictsbetweenprocessandfunctional(ordepartmental)ownership,resourceallocation,andthedevelopmentandalignmentoftheorganization’sbusinessobjectives,goals,andstrategy.

Figure61(Source:http://panorama‐consulting.com/resource‐center/2010‐erp‐report

Copyright A

BPM


332

Figure62.ProcessLeadership

WhatisimportantisthatcompaniesensuretheProcessCouncilstructureissetupforefficiencyandeffectivenessinexecution,soasnottoentanglethemselvesinaprocesscouncilbureaucracy.

8.4.3 BPM Office or BPM Center of Excellence

Someorganizations,particularlyingovernment,havecreatedwhatisreferredtoasaBusinessProcessManagementOffice(BPMO)oraBPMCenterofExcellence(BPMCOE).ManyBPMOsactinamannersimilartothatofaprojectmanagementoffice,identifying,consolidatingandreportingstatusonvariousprocessimprovementprojectsacrosstheenterprise.BPMCOEchartersincludesettingstandards,providingcommontoolsandmethods,trainingandeducationonbusinessprocessmanagementprinciplesandpractices,providinggovernanceonoverallprocessdesign,andintegratingbusinessprocessesattheenterpriselevel.BPMOsandBPMCOEsplayanintegralroleinprioritizingandallocatingscarceresourcestobusinessprocessimprovementefforts,aswellastrackingandreportingprocessperformancemetricstotherespectiveprocessownersandexecutivemanagement.

Copyright A

BPM


333

8.4.4 Setting Up a Business Process Management Center of Process

AwhitepaperdevelopedbySavvionprovidesanine‐stepmethodologyforsettingupaBusinessProcessManagementCenterofExcellence.ThismethodologyissummarizedinTable27.

SettingUpaBusinessProcessManagementCenterofExcellence

# Step

1 Attainexecutivesponsorship

2 DefinegoalsandSuccesscriteria

3 Definegovernancestructure

4 EstablishaBPMarchitecture

5 SetupBPMlibraryandrepository

6 Establishchangemanagementpractice

7 Takeprocessinventory

8 Prioritizeprocessselectionbasedonstrategicobjectives

9 StartexecutingBPMprojects

Table27.SettingupaBPMCenterofExcellence

Government Organizations and BPMOs

Ingovernment,manyBPMOshavearoleinenterprisearchitectureeffortsasmandatedbytheOfficeofManagementandBudget(OMB).TheOMBFederalEnterpriseArchitectureFramework(FEAF)requiresagenciestomaintainmodelsoftheirkeybusinessprocessesandrelatethemtootherarchitecturalmodelssuchasbusinessreference,technology,andperformancemodels.BPMOsareresponsibleformaintainingtherepositoryofprocessmodels,identifyingopportunitiesforimprovement,andworkingwithvariousstakeholdersinthedevelopmentofbusinesscasesforprocessimprovementandtransformationefforts.

Functional Centers of Excellence

Asbusinessesmatureinimplementingprocessmanagement,assigningaccountabilityforthemanagementofcorebusinessprocesses,anddevelopingmechanismstointegrateandaligntheseprocesses,theymaydiscoverthenatureofhowworkisperformedandimprovesintheorganization.Ratherthancommandandcontroloftheperformanceofindividualtasks,processownersfindthattheyneedtobesupportedbycross‐functionalteamswhoarealsofocusedontheperformanceoftheoverallprocess.Insteadofcommandandcontroloversight,

Copyright A

BPM


334

theseteamsmayworkrelativelyindependently,withguidanceandsupportfrommanagement.

Companiesencounteraneedforchangeintherequiredskillsandcultureoftheirorganizationastheygainexperienceinprocessmanagement.Theyneedtomaintainandintegratenewskillsandprofessionalexpertiseacrossallbusinessprocesses.Specializedskillsmayhavepreviouslyresidedinafunctionalgroupoftheenterprise.Bestpracticesgroups,sometimescalledcentersofexcellence,provideknowledge,standards,bestpractices,training,andeducation.Theyareresponsibleforensuringtheproperresourceswithproperskillsareplacedandallocatedproperlythroughoutthecompany’sbusinessprocesses(seeFigure63).6

CentersofExcellencemaybevirtualorganizations(oftenknownasaCommunityofInterest,orCOIN).Theymaysimplycompriseanemaildistributionlisttoconnectallengineers,ortheymayberobust,institutionalizedgroupswithlargetrainingfacilities.Manycentersofexcellenceareorganizedaroundaparticularskillorprofession,suchassales,marketing,finance,andinformationtechnology.Coaches

6ConceptderivedfromDr.MichaelHammer’s1997bookBEYONDREENGINEERING–HOWTHE

PROCESSCENTEREDORGANIZATIONISCHANGINGOURWORKANDOURLIVES.Dr.Hammerdiscussesseveralcasestudiesrelatingtotheevolutionoftheprocess‐centeredenterprise,includingtheintroductionofcentersofexcellence.

Figure63.Theneedforcross‐functionalprocesscollaboration

Copyright A

BPM


335

maybeassignedtobusinessprocessesfromtheCentersofExcellence,witharesponsibilityforsupportinganddevelopingmembersinordertoensurethatthecaliberoflocalizedskillsismaintainedandenhanced.CentersofExcellenceoffertrainingandeducationprogramsaswellasprofessionalnetworkingforsharingexperiences.SomeorganizationsuseCentersofExcellenceasanentréeforpeopleintotheorganization;i.e.,theyarehiredbythecenteranddeployedfromthecenterstoprocessteams.

8.5 A Summary Discussion

Everyenterpriseisunique,withitsownuniqueculture,values,incentivesystems,businessprocesses,andstructure.Todaymanycompaniesarestillstructuredaroundafunctionalhierarchy,withlittleornoaccountabilityfortheirend‐to‐endbusinessprocesses,whichdelivercustomervalueacrossfunctionalsilos.However,companiesthathavemadethetransitiontoProcessCouncilsandBusinessProcessManagementCentersofExcellenceseemtohavehadmuchmoresuccessthanthosethathavenotmadetheleapintoBPMprocessgoverningstructures.

Asthepowerandbenefitofmanagingbusinessprocessbecomesmoreprevalent,organizationalfocusandstructurearelikelytoprogresstoincludeaprocessdimension.Thisdevelopmentmayleadtosignificantchangeinhowworkisperformedandmanaged.Itwillinvolvenewrolesandresponsibilities,performancemeasures,andcompensationplans.Businesseshavefoundthatthenotionofprocessownershipiscriticaltothesuccessfulmanagementoftheircorebusinessprocesses.

Thereisnosinglestructure,setoftiles,roles,orculturethatisclearlyemerging.However,manycompaniesappeartobeadaptingtobusinessprocessmanagementandhavemanyattributesincommon,intermsoftheirorientationtoprocess,settingupagoverningbody(eitherstand‐aloneorasacouncil),anddevelopingtheskillsetstoimproveprocessperformance.WhatisclearisthatProcessOrganizationsaretakingshapeanddeveloping,andbestpracticesareemergingthatareclearlysettingapartthosewhohaveembeddedprocesswithintheirorganizationsandthosewhohavenot.

8.6 Key Concepts

ProcessOrganization—KeyConcepts

Fosteringaprocessculture

Anenterprisefostersaprocessculturewhenthebusiness’processesareknown,agreedupon,communicated,andvisibletoallemployees.

Copyright A

BPM


336


Characteristicsoftheprocess‐maturingenterprise

Asanenterprisematuresinmanagingitsbusinessprocesses,itsorganizationalstructurewillnaturallytendtowardchange,whichcomprehendsaprocessdimension.Managementofworkfromadownwardmanagerialcommand‐and‐controlapproachadaptstoincludeahorizontaldimensionreflectiveofend‐to‐endprocesses,drivingaccountabilitytothecustomerfordeliveryofvalueacrossfunctions.

Processowner Anindividualorgroupisassignedtheroleofprocessownerforacompleteend‐to‐endbusinessprocess.Theprocessownerhasanongoingresponsibilityandaccountabilityforthesuccessfuldesign,development,executionandongoingperformanceofthisprocess.

Processsupportingroles

Successfulprocessmanagementwithinanenterprisewillinvolvenumerousrolesinadditiontoprocessowner.Someindividualswillhaveresponsibilityformorethanonerole.Themorecommonrolesinclude

Processmanager, Processanalyst, Processdesigner, Processarchitect, Businessanalyst, Subjectmatterexpert,and Executivemanagementandleadership.

Processgoverningbody

Toenablecross‐functionalanddepartmentalprocessimprovementormanagementprogramstosucceed,organizationssetupadistinctgoverningbodytoprovideleadershipandclarifydecisionrights

Governancestructurestandards

Whiletherearemanygovernancestructures(governingbodies)proposedandimplemented,thereisnosinglestandardforcreatinganorganizationalfocusonprocess.

Copyright A

BPM


337


ProcessCouncil AProcessCouncil,madeupofexecutiveleaders,functionalordepartmentheads,andprocessowners,isonecommonapproachtoprocessgovernance.TheProcessCouncil

Ensuresalignmentofbusinessprocesseswithenterprisestrategies,goalsandobjectives,

Mayhaveresponsibilitytoidentifyandresolvecross‐processintegrationissues,conflictsbetweenprocessandfunctionalownership

Mayhaveresponsibilityfortheallocationofbusinessprocessmanagementresources.

Additionalprocessgoverningbodies

Otherorganizationalapproachestoprocessmanagementincludeestablishinga

BusinessProcessManagementOffice(BPMO), BusinessProcessManagementCenterof

Excellence(BPMCOE),or FunctionalCenterofExcellence(oftenknownas

aCommunityofInterest,orCOIN).SettingupaBusinessProcessManagementCenterofExcellence

Attainexecutivesponsorship DefinegoalsandSuccesscriteria Definegovernancestructure EstablishaBPMarchitecture SetupBPMlibraryandrepository Establishchangemanagementpractice Takeprocessinventory Prioritizeprocessselectionbasedonstrategic

objectives StartexecutingBPMprojects

BusinessProcessManagementProfessional

BusinessProcessManagementProfessionalsmustunderstandthemyriadofpotentialorganizationalchangesthatmaybebroughtaboutthroughincreasingprocessmaturity,sothattheycanguidetheenterprisethroughthetransition.

Copyright A

BPM

P InternationalChapter 9

Enterprise Process Management

Copyright A

BPM

P InternationalChapter9.EnterpriseProcessManagement

339

Foreword by Peter Fingar, Business Strategy, BPM, and Globalization Advisor at PeterFingar.com

Back to the Future of Enterprise BPM.Processisnothingnew,butthecapabilitytomanageend‐to‐endprocesseshasprogressedthroughthreewavesoverthepastseveraldecades.

The First Wave.Inthefirstwaveofbusinessprocessmanagement,whichbeganinthe1920sandwasdominatedbyFredrickTaylor’stheoryofmanagement,processeswereimplicitinworkpracticesandnotautomated.AfterWorldWarII,however,applyingsciencetoprocessbecamefront‐and‐centerasW.EdwardsDemingandJosephJurantaughttheJapaneseaboutthepowerofqualitymanagement.Theirworkandthatofotherstriggeredawaveoftotalqualitymanagement(TQM),spurredonbythepublicationsofDemingandJuranin1982,asshownbelow.Theemphasiswasnotsomuchonthedesignofnewprocesses,butonstatisticalmeasurementsasameansofimprovingworkpracticesandquality.

The Second Wave.Thenadecadelater,the1992blockbusterbookREENGINEERINGTHECORPORATIONhitcorporateboardrooms.Inthissecondwaveofbusinessprocessmanagement,processesweremanuallyreengineeredand,throughaone‐timeactivity,castinconcreteinthebowelsoftoday’sautomatedEnterpriseResourcePlanning(ERP)andotherpackagedsystems.Although“downsizing”isthemonikermostrememberedfromHammerandChampy’sBusinessProcessReengineering(BPR),itwastechnologicalenablementthatallowedcompaniestoteardownfunctionalsilosandreengineerend‐to‐endbusinessprocessesthatspannedindividualfunctionaldepartments(silos).Historically,ERPsolutionshadalltheflexibilityofwetconcretebeforetheywereinstalledandalltheflexibilityofdryconcreteafterinstallation.Evenwithdocument‐centeredworkflowaddedtoERP,suchsystemsonlytookupdiscreterolesasparticipantsinprocesses;rarelydidtheyprovidebusinessmanagementcontrolovertheprocesses.Thosethatdid,onlydidsoforsubprocessesandweregenerallylimitedintheircapability.

Copyright A

BPM


340

The Third Wave.IntheThirdWaveofBPM,thebusinessprocesswasfreedfromitsconcretecastingsandmadethecentralfocusandbasicbuildingblockofautomationandbusinesssystems.Processesbecamefirst‐classcitizensintheworldofautomation.Changewastheprimarydesigngoalbecause,intheworldofbusinessprocessmanagement,theabilitytochangeisfarmoreprizedthantheabilitytocreateinthefirstplace.Itisthroughagilebusinessprocessmanagementthatend‐to‐endprocessescanbemonitored,continuouslyimprovedandoptimized.Feedbackofresults,agility,andadaptabilityarethebywordsofthethirdwave.Thequestionis,however,howcansuchnoblegoalsbeattained?AndtheanswercameintheformofaBusinessProcessManagementSystem(BPMS)that,unlikeanERPsystemwithdataandapplicationsatitscore,placestheabstractdata‐typeofprocessatthecore.Inlayterms,theBPMSplacesthenotionofprocesscenterstageintheworldoftechnologicalenablementforbusinesschange.

Happy Anniversary and the Next Decade.AsthecoauthorofTHETHIRDWAVE,it’shardtobelievethat2012isitstenthanniversary(Isupposethetitleofgrandpadoesindeedapply).ButinsteadofcelebratingtheTinAnniversary,it’salsosomewhatdishearteningthatthe“M”inBPMhasoftenbeenignored.AsprocessluminaryAndrewSpanyifamouslyasked,“HowhasBPMactuallychangedthebehaviorofleadership?”Suchquestionsgostraighttotheheartoftruebusinesstransformation.InsomecasestheBPMShasbeenusedforlittlemorethananewerversionofenterpriseapplicationintegration(EAI)ortraditionalworkflow.Whilesuchapproachescanimproveback‐officeefficiencies,where’sthecompetitive‐advantagebeef?Aswe’llexploreinthischapter,theword“enterprise”hastobeappendedtothetermBPM.Forthattohavemeaning,companiesmustcrossoverfrom“organizationmanagement”ofpeopletoprocessmanagementthatsupersedesorganizationmanagementandspansmultipleorganizations.Politicsandinertiaarethehigh‐barrierobstacles,andthischapterexploreshowtonavigatetheseobstaclestoharnessthetruevalueofprocessmanagement,strategicBPM.

Okay,yourorganizationhasmadethebigleaptoEnterpriseBPM.Butthatdoesn’tsignalthebeginningoftheendofyourBPMjourney;itsignalstheendofthebeginningofamuchmorechallengingjourney.Nowwhat?

Intoday’sworldofglobalizationandextremecompetition,leadership(the“M”inBPM)mustextendnotjustacrosstheenterprise,butalsoacrosstheentirevaluechain!

Companiesdon’tworkalone,and,onaverage,over20companiesmakeuptoday’svaluechains—sometimeshundreds.Thisisespeciallyimportanttorecognize,asnoonecompany“owns”theoverallvaluechain.InMANAGEMENTCHALLENGESOFTHE21STCENTURY,thelatePeterDruckerelaborates,“Thelegalentity,thecompany,isarealityforshareholders,forcreditors,foremployeesandfortaxcollectors.Buteconomically,itisfiction.Whatmattersinthemarketplaceistheeconomicreality,thecostsoftheentireprocess,regardlessofwhoownswhat.Againandagaininbusinesshistory,anunknowncompanyhascomefromnowhereandinafewshortyearshasovertakentheestablishedleaderswithoutapparentlyevenbreathinghard.Theexplanationalwaysgivenissuperiorstrategy,superiortechnology,

Copyright A

BPM


341

superiormarketingorleanmanufacturing,butineverysinglecase,thenewcomeralsoenjoysatremendouscostadvantage,usuallyabout30percent.Thereasonisalwaysthesame:thenewcompanyknowsandmanagesthecostsoftheentireeconomic[value]chainratherthanitscostsalone.”

ThechallengeaheadistotakethehugeleapfromEnterpriseBPMtoValueChainBPM,andcloudcomputingprovidesthetechnologicalenablementforthatleap.Cloudcomputingallowsacompanytocollaborateinnewwayswithitstradingpartners,andprocesscollaborationacrossthevaluechainisthekeytogainingcompetitiveadvantage.Asexplainedinthe2012book,BUSINESSINNOVATIONINTHECLOUD,byestablishingsharedworkspacespoweredbyasharedBPMSin“CommunityClouds,”employeesfrommultiplecompaniescanworktogetherasa“virtualenterprisenetwork”andfunctionasthoughtheywereasinglecompany.Theyallparticipateinthesamevalue‐deliverysystem,sharingcomputing,communication,informationandBPMresources.No,thisisnotsome800‐poundgorilladominatingthevaluechain,usingitsmighttosqueezesuppliers.It’saboutOpenLeadership,CollectiveLeadership,andCollaborativeKeyPerformanceIndicators(KPIs)thatfostertrust(forrealdatasharing)andincentivizeallparticipantsinthevalue‐deliveryecosystemintheCloud.

BytakingtheBPMSasthetechnologicalenablerintotheCloud,companiesandtheirsuppliersandcustomerscanbuildandmanagedynamicBusinessOperationsPlatforms(BOPs)orBusinessNetworks(Business“OperatingSystems,”ifyouwill).AswithEnterpriseBPM,successwithValueChainBPMwon’tmagicallyhappenbecauseoftechnology‐enablementintheCloud;itwillbethe“M”inBPMthatonceagaincounts.Leadershipisallinthenewworldofextremetotalglobalcompetition.Thelessonisshort:innovateordie;andthecornerstoneofbusinessinnovationismanagementinnovation.

Copyright A

BPM


342

Contents

ForewordbyPeterFingar,BusinessStrategy,BPM,andGlobalizationAdvisoratPeterFingar.com...............................................................................................................................339

9.0 Introduction..........................................................................................................................344

9.1 TransitioningtoEnterpriseProcessManagement...............................................345

9.1.1 BuildingtheBusinessCaseforMovingtoaProcessCentricModel.....345

9.1.2 Gettingstarted—theimportanceofleadership,BPMleadershipplan347

9.1.3 WhereProcessandOrganizationComeTogether.......................................347

9.1.4 Thingstoconsider:ProcessFrameworks&IndustryReferenceModels 348

9.2 Currentstate:AssessingProcessMaturity..............................................................352

9.2.1 CapabilityMaturityModelIntegration(CMMI)............................................353

9.2.2 ProcessEnterpriseMaturityModel(PEMM).................................................354

9.3 ProcessEnablement..........................................................................................................354

9.3.1 TrainingandEducation...........................................................................................355

9.3.2 MarketingandCommunications..........................................................................355

9.3.3 ProcessScorecards....................................................................................................355

9.4 ProcessGovernance...........................................................................................................356

9.4.1 RoleofGovernanceintheProcessOrganization..........................................356

9.4.2 GovernanceProcesses..............................................................................................357

9.4.3 ProcessGovernance:MakingitWork................................................................358

9.4.4 ProcessPortfolioManagement............................................................................358

9.4.5 ProcessRepositoryManagement.........................................................................358

9.5 BusinessProcessManagementRoadmap................................................................359

9.5.1 ProcessRoadmap.......................................................................................................359

9.5.2 EnablingRoadmap.....................................................................................................359

9.6 ProcessManagementCenterofExcellence.............................................................359

9.6.1 BenefitstotheOrganization..................................................................................360

9.6.2 TypicalRoles................................................................................................................361

9.6.3 Responsibilities...........................................................................................................361

9.7 BPMIntegrationinSupportofProcessManagement.........................................362

9.7.1 Fitintheorganization..............................................................................................363

Copyright A

BPM


343

9.7.2 RoleofITinProcessManagement......................................................................363

9.7.3 EnterpriseorBusinessArchitectureandProcessManagement...........364

9.7.4 ContinuousorQualityImprovementinitiatives...........................................364

Copyright A

BPM


344

9.0 Introduction

Fundamentally,organizationmanagementisaboutmanagingpeopleandhowtheydowork.Itisconcernedaboutefficiency.Processmanagementisaboutmanaginghowalltheworkneededtodeliveranendproductorservice(regardlessofwhodoesitorwhere)fitstogetherandisperformed—forquality,timingandcostmanagement.

EnterpriseProcessManagementrepresentsanewwaytoviewabusinessoperation—onethatdoesnotfitatraditionalorganizationstructure.Thisviewspansanentireprocessandincludesalltheworkthatisperformedtodelivertheprocess’productorservice,regardlessofwhatbusinessunitsorlocationsmaybeinvolved.Thisviewbeginsatahigherlevelthanthelevelintheorganizationthatactuallyperformsworkandthenbreaksdownintosubprocesses,whichmaybeperformedbyoneormorebusinessunits,andthentoactivitiesandtheirworkflowwithinbusinessunits.

Thishigher‐levelperspectiveiscriticalincontrollingtheimpactandthusthebenefitofchangesinthebusinessoperation.Changeisnowviewedfrombothitsimpactontheindividualbusinessunitthatismakingthechangeandfromitsimpactontheactivitiesupstream(howtheywillneedtochangetoprovidethematerial,documents,informationetc.,thatthechangedbusinessactivityrequires)anddownstream(howconsumersofwhateverthechangedbusinessunitproduceswillberequiredtomodifytheirwork,inordertoconsumewhatisnowgoingtobeproduced).Thisprovidesaverydifferentviewofcost,impact,andbenefitthatisnotavailableinthetraditionalorganizationalviewofthebusiness.

Thisbroaderviewofthebusinessmanagementinvolvesallaspectsoftheprocess—itscost,itsproblems,itssystems,itsquality,anditsperformance.Thisisindependentofwheretheworkisdone—internalorexternal,inthesamelocationorothergeographicallocations,insubsidiariesoroutsourced.Itviewsallgroupsassuppliersofcomponentsoftheworkandtheprocessastheintegratorofthecomponents.Thisallowsmanagementtohaveadifferentviewofperformance,cost,andquality.Inthisview,managementcanevolvemeaningfulKPIsforeachofthecomponentsintheprocessandmeasureperformanceagainstthem—allowingallpartsofthebusinesstoessentiallycompete,basedonprice,service,quality,andon‐timedelivery,withotherinternalandexternalsuppliers.

Ofcourse,ifallworkremainsinternalwithinthecompany,thisviewallowsmanagementtobenchmarkeachcomponentintheprocessasthebaselineforaqualityimprovementprogramandtoconstantlypromotequalityimprovement,customerserviceimprovement,andcostreduction.

Thisgivesmanagementalevelofcontrolthathasnotbeenpossibleinthepast.ThisalsoallowsSeniorManagementtogainbettervisibilityintotheoperationandthewayproductorservicesarebuilt,delivered,andinvoiced.Ittieseverythingtogetherfromaproductperspectiveandoffersadifferentwaytolookatcost—asitrelatestotheprocessanditscomponents.Italsoallowsthemtoidentifyweaknessesinthe

Copyright A

BPM


345

wayproductisbuiltandthewaytheproductismanaged—fromsalesthroughdelivery.

9.1 Transitioning to Enterprise Process Management

Mostchangetodayisfocusedonsmallimprovementorproblem‐resolutionprojects.Afewprojectsareactuallybroadenoughtobetransformationalanddeliverfundamentalchangesinthewaythebusinessisviewedandthewayworkisdone.Butmoreoften,changestorules,operations,policies,andproceduresaremadeeveryday;overtimetheybecomeinstitutionalizedasunwritten(andunapproved)lawinthewaythebusinessoperationworks.Together,thesechangescauseconstantdisruption,impairproductivity,andbuildalayerofunintendedregulationsaroundrealwork.

Whilethisunintendedoverheadcausesharm,thebiggestproblemcausedbytoday’snarrowly‐focusedchangeistherippleofthechangesastheirimpactaccumulates,introducingconstantproblemsintoupstreamanddownstreambusinessoperations.Whilemostsmallchangeshaveaminimalimpactonotherpartsoftheoperation,overtime,thesesmallchangescombinetohaveaseriousimpact,disruptingoperationsanddegradingbothqualityandperformance.

Thiscreepingdisruptioniscausedbythenarrowperspectiverequiredbymanagementunderthecurrentorganizationalviewandthelimitsitimposeswhenlookingatchangeanditsimpact.Removingthislimitationisamongthekeyreasonstomovetoaprocessperspectiveandcreateaprocessmanagementapproachtocontrollingchangeandimprovingbothqualityandperformance.

9.1.1 Building the Business Case for Moving to a Process Centric Model

“Ifitisworthdoing,itisworthdoingright”;butastheysayinthemedicalprofession,thefirstruleis“donoharm.”Afterthat,allthat’sleftisimprovement.Buthowdoyouknowthatwhatyouthinkisrightwilldonoharmtoothers?ThatistheinfamousrippleeffectthatbothITandbusinessoperationsstrugglewitheveryday.Therootcauseofthisproblemhasbeenaninabilitytopredictimpactandmitigatethepotentiallynegativesideofit.

Theunderlyingreasonforthisproblem’sexistenceisthatchangehasusuallybeenviewedfromanorganizationperspective.Whilethishasbeentheonlyperspectiveavailabletomostmanagers,itisnotarealviewofhowbusinessactuallyworks.Eachbusinessunitperformsworkthatisbasicallythesameeachday.Whatisdoneisbasedonwhatthebusinessunitstaffreceivefromoutsidethebusinessorfromanotherbusinessunit.Theythentakesomeactionandpasstheworkontoanotherbusinessunit.But,conceptsof‘change’seldomcomprisedorconsideredwhatishappeningoutsideanybusinessunit.Thereasonwhyisbasedontheorganizationalviewofthecompany.Managersarejudgedonhowtheirbusinessunitperformsandhowclosetheycometomeetingtheirbusinessunitgoals.Inthisview,thereisgenerallynoconsiderationfortheimpactofachangeonothers,andthishaslimitedmanagement’sabilitytolookbeyondtheusualorganizationalsilos.Tobefair,however,untilrecentlytherehasbeennotalternativetotheorganizationview.

Copyright A

BPM


346

ButthisischangingascompanieslikeUPSandSloanValvemovetoprovideaprocessperspectivethatcomplementsthenormalorganizationalperspective.

Intoday’sbusinessenvironment,itiscriticaltooptimizetheresultofanychangeexpenditure.Companiesarenotspendingmoneyonhigh‐riskimprovementprojects.But,giventheproblemsassociatedwiththenarroworganizationalviewthatmanagementhashadtodealwith,thequestionbecomes,“howcanmanagementbecertainthateverydollarspentonimprovementactuallyimprovestheimmediateoperationwhileatleastcausingnoharminotherpartsofthecompany?”AtABPMP,webelievealargepartoftheansweristoprovideaviewoftheentireprocessesinacompanyortoatleasttrackworkandbuildhigh‐levelprocessmodelsintheareasthatwillbechanged.

Whilethismayseemlikeasignificanteffort,itisactuallymanageablegiventoday’sBPMStechnology(seechapter10).Inaddition,itisnotnecessarytoidentifyordefineindetailalltheprocessesinacompanyforaProjectManagerorteamtobegintointegrateaprocessperspectiveintotheirprojects.High‐levelprocessesandthewaytheyinterweavecanbequicklyidentifiedanddefinedbyworkingbackwardfromproductdeliveryorservicedelivery.Butthisrequiresashiftfromcongenitalthinking,orthebeliefthatyoumustbe100%rightandcompleteinanythingthatisdone.

BPMisallaboutiterationandevolutiontooptimization.Youarenotexpectedtospendlongperiodsintheanalysisandredesigntotrytogettothe100%level.Youareexpectedtomovequicklyandcomeclosetoright,andthenfindholesanderrorsanditerateagain.Inthisway,everythingevolvesandchangehappensquickly,withtheseriousproblemsbeingcorrectedfirst.Thisgivesthegreatestbenefitearlyintheprojectandchangesthebenefitcurve.

Whenappliedtoprocess,thecompanycanmovequicklyandidentifyafirstcutathigh‐levelprocessesandthewaytheyinteract,andtheniterateandrefinethemodels.Thisprovidesaframeworkfortheevolutionofdetailthroughprojectsindifferentbusinessunits,whichfillinthedetail.

Foraprojecttobuildthisview,theProjectTeamwillneedtoworktheirwayupstreamintheactivitiesthatfeedthepartofthebusinessthatwillbechanged.Thentheyneedtoworkdownstream,followingtheconsumptionofthedeliverablesoftheworkthatwillbechanged.Thistrackingmustgoallthewaytothebeginningandtheendpoints.

Whatthisprovidesisawaytocheckchangesagainstimpactoutsidethebusinessunit.

Thischeckwillshowhowanychangecancausedisruptiondownstreamandadditionalrequirementsofbusinessunitsupstream.Withthisnewinformation,theteamcantakeabroaderviewandavoidsolutionsthatcauseharmtoothers,whichmayresultinseriousbusinessdisruption.

Inaddition,movingtoaprocess‐levelproject,thecompanycanlookatqualityandcostinaverydifferentway.Whileeachbusinessunitcanimpactqualityandmust

Copyright A

BPM


347

thuscontrolit,overallqualityrequiresaprocessperspectivetomanagethe“build”ofqualityproblemsandeliminatethem.

Withaprocessperspective,theProjectTeamwillbeabletocollaboratewithotherpotentiallyimpactedbusinessgroupstoavoidchange‐relatedproblemsandimplementamorecomprehensivetypeofperformancemeasurementandqualitymonitoring—savingtime,money,disruption,andavoidingsuddenqualityproblems.Itwillbeabletolookattherootcausesofproblemsoutsidethebusinessunit,oftenforthefirsttime.

9.1.2 Getting started—the importance of leadership, BPM leadership plan

ProcessManagementcannotbeviewedintermsofatraditionalorganizationstructure.Itisseparateanditdoesn’taligntotheorganization.Inreality,processiscross‐organizational.Itwindsthroughmultipleorganizations,witheachaddingsomecomponentorpartofthefinalproductorservice.Theprocessdoesn’tneedtobelimitedtoanyonelocationoreventoanyonecompany—asinoutsourcingorthepurchaseofparts,sub‐assemblies,orservicesthatjointoproducetheproduct.

Becauseitistotallyindependentfromorganizationmanagement,processmanagementwillrequireaseparateviewoftheoperationandaseparatesetofprocessmanagers.Thesemanagersshouldberesponsiblefortheoverallqualityandefficiencyofoneormoreprocesses,dependingontheirsizeandcomplexity.Also,becausethisisseparatefromthenormalorganizationstructure,theprocessmanagersshouldreporttoaseparateexecutive.Thiswillallowthemtoremainindependentofthenormaloperationalconcernsthataffecttheorganizationstructure.

Thesemanagersmusthaveauniquesetofobjectivesthattheyaremeasuredagainst.Theirconcernistheprocessanditsimprovementintermsofrecognitionfrombusiness‐unitmanagersthattheyarepartofalargeroperationinvolvingcollaborationamongthebusinessunitmanagers,overallcost,timing,quality‐improvementfortheprocess,andcustomer‐satisfactionimprovement.Ofcourse,todothis,thecompanywillneedtodefineprocesses,andstarttomeasurethethingsthatprocessmanagerswillberesponsiblefor.ButusingBPMStechnologysupport,thisinformationcanbeobtainedandtheprocessmanagementactivitycanbecontrolled.

However,tobeeffective,theprocessmanagersmusthavetheauthoritytoworkwithalllevelsofbusinessunitmanagers,andwhencollaborationbreaksdown,toaccessseniorexecutivemanagementforarbitration.

9.1.3 Where Process and Organization Come Together

AsnotedthroughouttheCBOK,processcanbebrokenintomultiplepartsfocusedondifferentlevels—fordiscussion,let’scallthemBusinessFunctions,subprocesses,activitieswithworkflow,tasks,worksteps.Thenumberoflevelsandthenamesofthoselevelswillchangebycompanyordepartmentwithinacompany.Therearenostandardsintheindustry.Butthenumberoflevelsinyourdefinitionofprocessand

Copyright A

BPM


348

thenamesyoucallthemarenotwhatisimportant.Whatisimportantisthattheyformallyexist.

Usingthisversionoflevelsandnames,wewillsaythatprocessintersectswithorganizationattheactivity(workflow)level,whereworkisnowbrokenapartandassignedtobusinessunitstobeexecuted.Thisisthepointwhereprocessmanagementandorganizationmanagement,andarelationbetweentheirrespectivemanagers,cometogether.

Thislinkformsatypeofmapofprocessexecutionandmovesitfromaconceptualentitytoaphysicalentity:theworkisnolongerjustanidea—itistangible.Theprocessmanagermustnowformaseparatemanagementgroupofthebusinessmanagerswhoseorganizationsperformtheworkthatdeliverstheprocess’sproductorservice.Thisisacommitteethatmustberesponsibleforimprovementintheprocessandintheindividualbusinessunits.Theymustlookatproposedchangesinallbusinessunitsandmakecertainthatsolutionsdonotnegativelyimpacttheirindividualbusinessunitsortheprocess.CreatingthiscommitteemustbepartoftheProcessManager’sformalresponsibility.

However,becauseaprocessviewisverydifferentfromwhatmostmanagersarefamiliarwith,itisnecessaryfortheProcessManagertoprovideinformationonwhatisinvolved,howitallfitstogetherandhowitismanaged.This,frankly,cannotbeprovidedthroughtheuseoflow‐leveldrawtools.OrganizingthisinformationandcontrollingitcanbestbesupportedthroughaBPMS.Thiswillallowthecompanytohavebothend‐to‐endprocessviewsofthebusinessanddetailedviewswithinbusinessunits.Itwillalsoallowallcomponents,sub‐assemblies,etc.,tobeidentifiedandwheretheyarecreated,used,modified,joinedintolargersub‐assemblies,etc.,tobetracked.Inaddition,problemscanbeshown,processandworkflowmonitoredandreportedagainst,andthemainrulesthatdrivethequalityprocessandtimingtobeknownandadjustedtooptimizetheoperation.

But,mostimportantly,aBPMSprovidesacommonbasefortheProcessManagementcommitteetoprioritizechangeprojects,reviewchange,lookatpotentialimpactusingsimulationmodeling,andmonitortheprocessasitmovesfrombusinessunittobusinessunit.

Withoutthissupport,theProcessManagementcommitteecancertainlybeeffective,buttheamountofworkwillbesignificantlyincreased,andreportingtothegroupwillbedelayed.

9.1.4 Things to consider: Process Frameworks & Industry Reference Models

FundamentaltoBusinessProcessManagementinanorganizationistheEnterpriseProcessModel.MostorganizationswillbenefitgreatlyfromutilizingaProcessorindustryreferencemodelasastartingpointfortheclassificationofprocesses.Processframeworkscanbe

Copyright A

BPM


349

Generallyapplicableacrossdifferenttypesofcompaniesororganizations(APQCProcessClassificationModel,ValueChainOperationalReference[VRM])Model)

Specifictoanindustry(SupplyChainOperationsReferenceModel) Specifictoaprocessarea(InformationTechnologyInfrastructureLibrary),

or Specifictotechnology(SAP).

Asoutlinedabove,therearenumerousreferencemodelswithapplicabilitytoallorganizations,specificindustriesorevenspecificprocessareasortechnologies,andcombinationsofallfour.TheAPQCPCFandVRMcanbewidelyusedtosupportanumberoforganizations.TheSCORmodelismorespecificallytailoredtosupply‐chainorganizations.Atthissamelevel,therearealsonumerousindustry‐relatedmodels.APQChasseveralvariationsforspecificindustries,suchaspharmaceuticals.Therearealsomoregeneralarchitecturesthatincludeprocessviewsatanindustrylevel:forexample,eTOMisanarchitectureusedbytelecommunicationcompanies.Someprocessareascanhavespecificmodels:ITILdescribesthecommonprocessestosupportanorganization’sIToperations.Thereareevendefinitionsofprocessesusedtosupporttechnology,typicallylarge‐scaleERPimplementations.SAPusesaspecificprocessstructuretosupporttheblueprintofprocesses.

ProcessandIndustrymodelstypicallyserveasastartingpointforanorganizationtobaseitsprocessdesignandarenotmeanttobeanexhaustiverepresentationofanenterprise.Dependingontheorganization,practitionersmayleveragedifferentcomponentsofvaryingmodelstocreateastructurethatbestincorporatesthestructureofanenterprise.ReferencemodelscanbeusefulinidentifyingageneraltaxonomyandensuringthatallaspectsofprocessarethoughtofaspartoftheEPMdevelopmentprocess.

ProcessandIndustryReferenceModelscanalsobeusefulintyinginothercommoncomponentsofanoverallbusinessortechnicalarchitecture.Byprovidingacommontaxonomyorlanguagetounderstandenterpriseprocesses,organizationscanbettercompareorleveragesharedassets.Anexampleofthisisbenchmarking.Commoncomparisonofprocessesallowscompanieswithinanindustry‐orcross‐industrytocomparebenchmarkingdata.Somereferencemodelsalsoincludemoretechnicalaspectsrelatedtodataorservicesmodelwheretheprocessesarethecommonframeworkformanagingthecontent.CommonunderstandingofprocessesacrossorganizationsandindustrieswillbecomeevenmoreimportantovertimetofurthersupportERPdevelopment,commoditizationofprocessesortechnologies,andultimatelybusinessprocessoutsourcing.

Thepurposeofthisdocumentistooutlinethecommontypesandusesofprocessframeworks;itisnotanexhaustivelistofallvaluablemethodologies.Toserveasanexample,wewillprovidefurtherexplanationofsomeofthemorecommonlyusedreferencemodelsbelow.

Copyright A

BPM


350

9.1.4.1 APQC Process Classification Framework

Figure64.APQCProcessClassificationFramework

APQCisaninternationalbenchmarkingclearinghousethathascollaboratedwith80organizationsindevelopingaframeworkforprocessevaluation.TheAPQCProcessClassificationFramework(PCF)canbeusedbymanyorganizationsasthestartingpointforanEnterpriseProcessModel.TheAPQC’sProcessClassificationFrameworkismeanttoserveasahigh‐level,industry‐neutralenterprisemodelthatallowsorganizationstoseetheiractivitiesfromacross‐industryprocessviewpoint.Originallycreatedin1992byAPQCandagroupofmembers,theframeworkhasbeeninusebymanyorganizationsonaworldwidebasis.TheAPQChasindicatedthatthePCFissupportedbytheOpenStandardsBenchmarkingCollaborative(OSBC)databaseandisanopenstandard.TheAPQCplansthatthePCFwillcontinuouslybeenhancedastheOSBCdatabasefurtherdevelopsdefinitions,processes,andmeasuresrelatedtoprocessimprovement.ThePCFisavailablefororganizationsofallindustriesandsizesatnochargebyvisitinghttp://www.apqc.org.

Copyright A

BPM


351

TheProcessClassificationFramework(PCF)setoftoolsprovidesabeginningfordiscerningcore,support,andmanagementprocessescommonbetweenandacrossindustriessuchasmanufacturingandservice,healthcare,government,andeducation,tomentiononlyafew.ThePCFrepresentsaseriesofinterrelatedprocessesthatareconsideredtobebusiness‐critical.Itcanbeused“toenableorganizationstounderstandtheirinnerworkingsfromahorizontalprocessviewpoint,ratherthanaverticalfunctionalviewpoint”.

ThePCFconsistsoffourphases:Prepare,Plan,Implement,andTransition.Prepareisastrategicphase.Itisacomprehensiveassessmentthatfocusesonthecoreprocesses.Duringthisphase,abusinesscaseisidentifiedwithopportunitiesanddeterminestheexpectedbusinessresults.InthePlanphase,atime‐phasedapproachtoimplementthechangesidentifiedduringtheassessmentisdeveloped.Duringthisphasetheprocessanalystandtheanalysisteamrefines,redesigns,orreengineerscorebusinessprocesses.IntheImplementphasethechangesareimplemented.TheTransitionphaseisbothtacticalandstrategic.

Tactically,employeeteamsdevelopprocessoperatingproceduresandoverseethetransitiontothenewprocess.Strategically,theorganizationwillrepeatthemodelwithotherprocesses,basedontheirbusinessneedsandpriorities.

9.1.4.2 Value Chain Operational Reference (VRM) Model

AnadditionalmodelworthyofconsiderationistheValueChainOperationalReference(VRM)Model.VRMattemptstointegratethethreedomainsofaValueChain:product,operations,andcustomer.

Themodelhas3levelsofdetailunderoneframework.ThehighestleveliscalledLevel1,andtheLevel1processesofVRMare:Plan—Govern—Execute.InLevel2,asthefigurebelowshows,theLevel1processcategory‘Execute’isdecomposedtothecomponentsofMarket‐Research‐Develop‐Acquire‐Build‐Sell‐Fulfill‐Supportprocesscategories.Level3,whichisnotconsideredhere,providesamorecompleteframeworkforunderstandingandcontroloftheextendedValueChain.

TheVRMmodelsupportsthekeyissuesandthemeshingofprocesseswithinandbetweentheunitsofchains(networks)forthebenefitofPlanning,GoverningandExecution(information,financial,physicalflows)withtheobjectiveofincreasingperformanceofthetotalchainandsupportingitscontinuousevolution.TheValueChainGroupdescribesVRMasamodelthatprovides“acommonterminologyandstandardprocessdescriptionstoorderandunderstandtheactivitiesthatmakeupthevaluechain.”

Enterprisesapplyingthemodelareprovidedwithaframeworktoachievetheirgoalsofbothhorizontalandverticalcollaboration.TheVRMmodelusesacommonlanguagewhileatthesametimecreatingafoundationforsuccessfulServiceOrientedArchitecture.TheVRMframeworkorganizesprocessesthroughfivelevelsrepresentingthevariouslayersoftheorganization.Astheprocessesworktheirwayfromthebottom(actions)throughthetoptothestrategicprocesses,theybecomemorecomplexandclosertorealizationofthestrategicgoals.

Copyright A

BPM


352

Strategicprocessesarethetop‐levelprocessesinthevaluechain.Thesearetheprocessesspecificallydesignedaroundcustomerneedsandthebusinessstrategy.Decomposedfromstrategicprocesses,tacticalprocessesoutlinehowthegoalsofthestrategicprocesseswillbemet.Tacticalprocessesarederivedfromoperationalprocesses,whicharewheretheworkgetsdone.Activitiesaregroupsofactionsthatmakeuptheoperationalprocesses.Actionsarethelastgroupofprocessesandrepresentindividualitemsofworkthatcannotbebrokendownfurther.

Theseprocessesarefurthergovernedbythreemacroprocessesthatcontroltheenterprise:Govern,PlanandExecute.

9.1.4.3 The Supply Chain Operations Reference Model (SCOR)

TheSCORModelrepresentsaframeworkthatoffersameansoffacilitatingtheidentificationofprocessmodelsfornearlyanyandalltypesofenterprises.Thisisaholisticend‐to‐endprocessinclusiveofthesupplychainecosystem.Suchaframeworkisvaluableforenhancingenterpriseandstakeholder(internalandexternal)communicationforbuildingandsustainingprocess‐centricityintotheenterprise.

TheSupplyChainOperationsReference‐model(SCOR)hasbeendevelopedandendorsedbytheSupply‐ChainCouncil(SCC),anindependentnot‐for‐profitcorporation,asthecross‐industrystandardforsupply‐chainmanagement.Initiallythisconsortiumincluded69voluntarymembercompaniesinterestedinadvancingstate‐of‐the‐artsupply‐chainmanagementsystemsandpractices.Ithassinceexpandeditsreachtohealthcare,government,education,andmanyotherservice‐basedenterprises.

9.2 Current state: Assessing Process Maturity

Assessinganorganization’sprocessmaturityisanintegralpartofunderstandingwheretheorganizationistodayandwhereitaspirestogoinitsoverallprocessjourney.Therearenumerousprocessmaturitymodelsthatareusedbyanumberofpractitionersorvendors.Theycanrangefromthebasicfive‐pointscaletoamulti‐dimensionalprescriptivemethodology.

ProcessmaturityassessmentstypicallyassesstheabilityofanenterprisetosupportBusinessProcessManagement—theyfocusontheenterprise’slevelofmaturitywithrespecttoBPMcapabilities.Atthesametime,maturityassessmentscangaugethecapabilityofenterpriseprocessestodeliverbusinessresults.Insomecases,aprocessmaturityassessmentwillcaptureboth.Organizationsmaychoosemultiplematurityassessmentsovertimeandfordifferentpurposes.

Processmaturityassessmentscanbeusefulforestablishingabaselineofexistingcapabilitiesandtoaligntheorganizationonthecurrentstate.Assessmentsarealsousefulinidentifyingandaddressinganygaps.ThegapassessmentcanthusbeprescriptiveandassistanorganizationincreatingactionableplansoranoverallroadmapforBusinessProcessManagement,whichwillbediscussedfurtherinthissection.

Copyright A

BPM


353

Atthetimeofthispublication,overthirtydifferentprocessmaturityassessmentswereidentifiedfromnumerousconsulting,analystandtechnologyvendors.Thislistcontinuestogrow.Thepurposeofthisdocumentisnottoidentifyallofthemethodologiesinthemarketplacebutratherillustratetheimportanceofconductinganassessmenttoestablishabaselineandprovideactionableguidancetoachievegreatermaturity.Practitionersmustdecideontherightmodelfortheirorganization,dependingontheoverallstrategyofBusinessProcessManagement.Toillustrate,wewillreviewtwocommonmaturityassessmentsgoingfromthebasictothemorecomplex.

9.2.1 Capability Maturity Model Integration (CMMI)

TheCapabilityMaturityModelIntegration(CMMI)isaprocess‐maturityapproachthatcanbeusedforaprocess,project,oranenterprise.CMMIisaregisteredpatentbyCarnegieMellonUniversity.Thefive‐scaleclassificationistypicallylessprescriptivethanothermethodologiesbutcanbeusedasageneraldiscussionguideinevaluatingaspecificprocessareaorenterprisematurity.

Figure65.MaturityLevels

Copyright A

BPM


354

9.2.2 Process Enterprise Maturity Model (PEMM)

TheProcessEnterpriseMaturityModel(PEMM)wasdevelopedbyMichaelHammerandsummarizedin“TheProcessAudit”(HarvardBusinessReview,April2007).ThePEMMismeantasatooltohelporganizationsplanandmanagetheirtransitionstoprocessandconsistsofoneframeworkforassessingthematurityofanyparticularbusinessprocessandanotherforassessingthematurityofanenterpriseasawhole.Hammerclassifiesthesetwocomponentsastwoseparatedimensions:

EnterpriseCapabilities—foundationalrequirementsacrosstheenterprisetoenablesuccessfulprocesstransformationwithinanenterprisesspecificprocesses

ProcessEnablers—maturityofindividualprocessestodriveprocesstransformationwithinabusinessarea.

TheEnterpriseCapabilitiesincludethefollowingcomponents:leadership,culture,expertise,andgovernance(seeFigure66).TheProcessEnablersincludedesign,metrics,performers,ownerandinfrastructure.Hammerprovidesafour‐pointscaleforeachofthesedimensionstoassessandmanageoverallmaturity.

9.3 Process Enablement

Coretoenterpriseprocessmanagementarecapabilitiestosupporttheoverallenterpriseindevelopingprocesscapabilities.Essentialtoconductingenterprise‐wideBusinessProcessManagementisanoverallstrategytoenabletheorganization.Theenablementstrategyshouldbedescribedindetailandgivenasmuchattentionastheprocessesthemselves.Inmanyorganizations,anoverallchangemanagementconstructshouldbeemployedtoensureproperadoptionbytheorganization.Althoughoutsideofthescopeofthisdocument,itisrecommendedthatpractitionersfamiliarizethemselveswiththebasicprinciplesofchangemanagementandincorporatethemintotheoverallprocessprogram.Inadditiontochangemanagement,anoverallstructureforprojectandprogrammanagementshouldalsobeincorporated.Theenablementactivitiesshouldbespecificallydefinedwithintheoverallroadmap,asdiscussedlaterinthissection.Forillustration,wewillcoverseveralimportantenablingconcepts.

Figure66.EnterpriseCapabilities

Copyright A

BPM


355

9.3.1 Training and Education

Manyaspectsofbusinessprocessmanagementwillrequireenterprisetrainingandeducationtoaddressnumerouscapabilitygapsintheoverallmaturity.Toensurethattheconceptsofbusinessprocessmanagementareadequatelycovered,practitionersshouldconsiderdevelopingadetailedtrainingandeducationplan.Theeducationplancanbecomprisedofastakeholderassessment,alistingofcurriculumanddeliverymediums,aneducationmatrix,andanapproachtocontentdevelopmentandongoingtrainingdevelopment.Manylargeorganizationshaveadedicatedtrainingdepartmentthatcanassistindevelopment.

ThestakeholderassessmentshouldbealignedtotheoverallmaturityassessmentordefinedBPMstrategyfortheenterprise.ItshouldincludethevariousstakeholdersforBPM,specificrequirementstiedtoprocessstrategy,specificroles,andthetypeofinformationthatisrequired.

Fromtheoverallstakeholderassessment,thecurriculumanddeliverymediumscanbedraftedtobestservetheneedsofthestakeholders.Thislistingofcoursescanvarygreatlydependingontheoveralllevelofmaturityofvariousstakeholdersandthestrategyoftheoverallprocessprogram:coursescanrangefromspecifictrainingonBPMtechnologiestowhatitmeanstobeaprocessowner.Multipledeliverymediums—suchaseLearning,Podcasts,classroom,andwebtraining—shouldbeconsidered,basedonthetypeoftrainingandtheoverallaudience.

Aneducationmatrixshouldbedevelopedtotiestakeholdersandspecificlearningobjectivestothevarioustrainingprogramsandmediums.Aplanwillalsoneedtobedevelopedonhowtocreatethiscontentandmanageonanon‐goingbasis.Thisshouldbeincludedaspartoftheoverallenablingroadmap(discussedbelow).

9.3.2 Marketing and Communications

Inmanyenterpriseprojectsandinitiatives,thisenablingcapabilitywouldtypicallybecalledcommunicationsandfocusprimarilyonprovidingprocesscommunicationstotheenterprise.However,giventhestrategicimportanceofbusinessprocessprogramsandtheorganizationalheadwindstheyface,theoverallcommunicationofBusinessProcessManagementtotheenterpriseshouldbegiventhetreatmentofamarketingcampaign.Becauseofitsscope,thisdocumentdoesnotdelveintothevariousaspectsofmarketing;however,itisimportanttonotethatpractitionersshoulddevelopaplantothislevelofdetailthatincludesanoverallstrategyandtargetedcampaigns.Aspectsofsocialmediashouldalsobeconsideredtoreachbroaderaudiences.

9.3.3 Process Scorecards

Processscorecardscanplayanimportantroleintheongoingmanagementofaprocesstoensuretheoveralloperationalobjectivesaremet.Similarly,ascorecardshouldbeconsideredaspartofenablingenterpriseprocessmanagement.MetricsorKeyPerformanceIndicators(KPIs)shouldbedefinedaspartoftheoverallprocessprogramthatalignswithspecificobjectivesasdefinedbytheprocessroadmap,

Copyright A

BPM


356

discussedlaterinthissection.Thescorecardshouldbeusedamechanismtotrackenterpriseenablersagainstoverallgoals.

9.4 Process Governance

WhiletheProcessManagerwillhaveresponsibilityfortheoverallactivityintheprocess,thatwillnottaketheplaceofthenormalBusinessUnitManager’soperationalresponsibility.TheProcessManagerwillhaveabroaderoperationalresponsibility,butheorshewilltypicallynothavetheauthoritytodirectlyguidetheBusinessUnitManagers.ThismakesforadifficultsituationanditisthereasontheProcessManagermusthaveawaytodealwithdisagreement,recalcitrantBusinessUnitManagers,andoftenconflictingprioritiesandinterests.

Alargepartofthisabilitytodealwiththeproblemsisrelatedtoworkingwithmanagerswhomust,bypersonalevaluationrequirementsfromtheirownbosses,focusontheirindividualoperations.Itwouldbeniceifpeoplealwaysplayednicelywithoneanother,buttheydon’t.Thisisreality.Tomitigatethisreality,itisnecessarytoimplementaprocessgovernancestructurewithseparaterulesthatcontroltheinteractionbetweenthemanagersontheProcessManagementcommitteeandwaythatprioritiesaresetandperformanceismanaged.

Theseruleswillbeuniquetoeachcompanyandreflectthecompany’scultureandthewaytheprocessisperformed.Consideranexampleinwhichpartsareoutsourcedorreplacedbypurchasingsub‐assembliesthatwereoncebuiltin‐house.Controloftheprocessandgovernancewouldchange,andmustbeformallycreated,acceptedandmanagedbytheProcessManager.Withoutit,thecommitteewouldbechaoticandfailtodeliverrealprocessmanagement.

However,inallgovernance,caremustbetakentofindtherightbalancebetweencontrolandflexibility.Toomuchflexibilityentailsineffectivecontrol;withtoomuchcontrol,everythingbecomesachallenge.Findingtherightbalancewillbeanegotiationinallcompanies:nomanagerswillinglygiveuptheirfreedomtoactortheirauthoritytomakechange‐decisions.Thatiswhyconsensusontherulesthatcontrolgovernanceisimportant.Itisalsowhyseniorexecutives’higherauthorityiscritical—therewillalwaysbedisagreementswhenauthorityisbeingtakenaway.

Inaddition,amovetoaprocessviewpointwillpushmanagersintounfamiliarterritory,especiallywhentherearesomanydefinitionsofwhataprocessis.Thisproblemismanifestinthefactthat,inmanycompanies,a“process”isanygroupoftasksor,insomecases,asingletask.Inthesecompanies,theconceptofprocessmanagementwillbeastruggleformanymanagers,anditwilltaketimeandpossiblyexecutivedefinitionmandateandexecutivedecreethatthecompanyordepartmentismovingtoincludeaprocessviewaspartofthewaytheywillmanageworkandchange.

9.4.1 Role of Governance in the Process Organization

ProcessgovernanceisthemechanismforcreatingtherulesandstandardsbywhichBusinessUnitManagersinteractwiththeProcessManager,whohasnoauthority

Copyright A

BPM


357

overthemandcannotmakethemdoanything.Thisisanexampleofthematrixorganizationbasedonacentralcoordinator.Thecoordinator(ProcessManager)hasnorealauthority,butmustcoordinatewhatallparticipantsaredoing.Withoutsolidgovernancerules,thiswouldbeaformulafordisaster.Responsibilitywithoutauthoritysimplydoesn’twork.Butpossessingtheabilitytoappealtoahigherauthoritywhocanmakethingshappen,doesworkforacoordinator.SettingtheenvironmentforthiscommitteetooperateistheroleoftheProcessManagerandthroughhimorher,theapproachthatistakeninProcessManagementGovernance.

Asnotedabove,theend‐productorProcessManagementapproachwillbeuniquetoeachcompanybasedonsuchfactorsasculture,placementoftheProcessManagementrole,andtheauthoritythatisgiventotheProcessManagementcommitteebythe“higherauthority”—theexecutivemanagerresponsibleforthisfunction.

OncethegovernancestandardsaredefinedandtheapproachagreeduponbytheProcessManagementcommittee,ProcessManagementGovernancewillbecomepartoftheoverallchange‐governancestructureinthecompany.ThiswillincludebothBusinessandITchange‐managementandalltheCentersofExcellenceorCentersofExpertiseinbothgroups.Overall,theProcessManager’sroleinallchangeistohelpmanagersevaluatechangefromabroaderperspectiveandavoidabusiness‐unitsiloview.Thisisscaledtobebothstrategicforallchangeprojectscompany‐wide,andnarrowlyfocusedtohelpindividualprojectsavoidcausingdownstreamproblemsorcontributingtotheaccumulatednegativeimpactofmyriadsmallchangesinactivityandrules.

9.4.2 Governance Processes

ProcessManagementisdefinedbysuggestionfromtheProcessManagerandapprovedbyeachProcessManagementcommittee.ThegovernanceofthisfunctionisalsosuggestedbytheProcessManagerandapprovedbythebusinessmanagersinthevariousProcessManagementcommitteestheybelongto.TheresultisasetofproceduresthatcombinetodefinehowProcessManagementwillbeimplementedinthecompanyand,tosomedegree,inthevariousprojects(flexibilityisoftenneededattheprojectlevelandvariancesshouldbeallowedtoavoidoverhead).

Formallyprovidedinthisway,governanceisitselfamanagementprocess,andassuchitissubjecttothesameforcesthatdisruptanyprocess.Therefore,itmustitselfbere‐baselinedperiodicallytoavoidwhite‐spaceworkcreepandmakecertainitsprocessisvisible,controlled,andautomatedtothegreatestextentpossible.

WithBPMSsupport,automationcanbegeneratedfromagovernanceprocessmodel,justasallbusinessmodelsinaBPMScanbeusedtogeneratemanagementtrackingandperformance‐measurementapplications.Allprocesssimulationandimprovementcomparisonwillbemeasuredagainstthebaselineorinitialiterationoftheprocess.

Copyright A

BPM


358

9.4.3 Process Governance: Making it Work

ProcessManagementisachange‐governanceactivity.Ithelpsgovernchangeandprovidesabroaderperspectiveonthechangeprocess,withonepurpose:tohelpcoordinatechange,makingcertainthatchangesaredoneintherightwayandthatnoneofthemcauseharm.

ProcessGovernancemustbebasedonagreementamongthebusinessmanagersinvolvedinanyspecificchangeproject.Withouttheiragreement,governancewillnotworkandthebenefitsofProcessManagementwillnotbeavailabletothecompany—atleastnotforthatproject.Atabroaderlevel,thesameistrueforProcessManagement.Ifgovernanceisnotagreedonbyallinvolvedandcommittedtobyexecutivemanagement,themovetoaprocessviewwillnotsucceed.

Therealproblemofprocessgovernance,however,isoneofcollaboration,asprocessesarebecomingmorecomplexandinvolvesuppliers,outsourcedwork,andinternalworkthatcanbegeographicallylocatedanywhere.Obtainingagreementinthisenvironmentisdifficult,especiallyforapersonwhohasnorealauthorityoverthework,butresponsibilitytomakecertaintheprocessitselfrunswellandimproves.

Agreementamongtheparticipants,whilevital,isnotenough.ProcessManagersmusteventuallycoordinateallprocesschange.TheymustalsoreporttoaProcessOfficerwhohastheauthoritytomakedecisionsaboutchangeandtheinfluenceneededtopersuademanagerstomodifyanychangestotheiroperationthatwillcauseharmtoothermanagers’operations.TheymustalsohavethemandatetoworkwiththeCentersofExcellence,bothwithinandoutsideofIT,andwithcollaborativepartnerstoensurethatchangesactuallybenefitthegreatestnumberofbusinessunits.

Inaddition,itissuggestedthatcompaniesmovingtoaprocessapproachincontrollingworkcreateaseparateprocessfunctionthatwilltieorganizationmanagerswhocontributetoaprocessandlikewisetheProcessManagertothesameevaluationmetricsforperformanceandquality.Thiswillprovideincentiveforthemtoworktogetherasaprocessmanagementteam.

9.4.4 Process Portfolio Management

Thecornerstoneofgoverningenterpriseprocessesiscoordinatingtheenterpriseportfolioofinitiatives.Toprovideeffectivegovernanceinaccordancewithoverallprocessdesign,itisimperativethattheprocessenterpriseprovidesinputorisdirectlyalignedtotheenterpriseProjectManagementOffice.

9.4.5 Process Repository Management

Attheheartofprocessgovernancearetheenterpriseprocesses.Toprovidegovernanceinacomplexorganization,itisimportanttohaveacommon,standardizedviewofprocesses.Inmorematureorganizations,theseprocessesaretypicallymanagedinanenterpriseprocessrepositorythatisenabledbyaBusinessProcessAnalysis(BPA)toolset.Additionalgovernanceframeworksshouldbe

Copyright A

BPM


359

appliedtothemanagementoftheenterpriseprocessrepository,whichoftenoverlapswiththeoverallgovernancestructure.Forexample,processownershipwoulddefinetheabilitytomakeupdatestoordefinetheapproverofprocesscontentwithintherepository.

9.5 Business Process Management Roadmap

Essentialtoestablishingenterpriseprocessmanagementisacentralizedplantodevelopanddeliverprocesscapabilitiesfortheenterprise.TheBusinessProcessManagementRoadmapismeanttobethestrategicplanforanenterprisetodeliverBusinessProcessManagementovertime.TheBPMRoadmapwillvarybyorganization,dependingoncurrentanddesiredmaturityandoverallprocessstrategy.

Theroadmapshouldtypicallyspanseveralyearsanddirecttheongoingactivitiesassociatedwiththeprocessprogram.Theroadmapshouldconsistofmultipledimensions,includingclearlydefinedgoals,objectives,stakeholderanalysis,and—tiedtooverallstrategy—thedefinedactivitiesandatimecomponent.

Asdescribedabove,theroadmapcantakeonseveralinstantiations,dependingonnumerousenterprisefactors.Tohelpmanagetheoverallcomplexityofactivitiesrequired,itishelpfultoseparatetheworkintotwoseparatecategories:(1)thoserelatedtospecificprocessareasand(2)thoserelatedtodevelopingtheoverallenterprisecapabilities.

9.5.1 Process Roadmap

Theprocessroadmapshouldincludetherequiredsetofactivitiesrelatedtoincreasingthematurityorcapabilitiesofaspecificprocessarea.Forexample,aroadmapshouldbedevelopedspecifictoOrdertoCashthatdepictstheoverallanddetailedprogramsandprojectstodrivevalueacrosstheprocess.Process‐arearoadmapsshouldbemanagedbytheoverallprocessownerandintegratedacrosstheprocessareas.Ifthespecificprocessareahasbeenassessedaspartofamaturityassessment,theseresultsaswellasanyadditionalprojectsshouldbeincludedhere.

9.5.2 Enabling Roadmap

Theenablingprocessroadmapwouldrunparalleltotheindividualprocessroadmapsanddepicttheactivitiesrequiredtodriveoverallprocessmaturityintheenterprise.Examplesofelementswithintheenablingroadmaphavebeendiscussedthroughoutthissectionandincludeaspectsofprocessmaturity,processgovernance,processmarketing,processeducation,andoverallleadershipdevelopment.Again,dependingonthetypeofmaturityassessmentused,resultsandactionsshouldbereflectedintheenablingroadmap.

9.6 Process Management Center of Excellence

Toconcentrateexpertise,manycompaniesaremovingtoaCenterofExcellenceorCenterofExpertise(CoE)model.Insomecompaniesweareseeingthecreationof

Copyright A

BPM


360

specialtyCoEsinbothITandthebusinessoperationstohelpfocusskillsandknowledgeandprovidehelpbroadlytothebusiness.

“ThekeytoCoEsuccessisacombinationofauthorityconcentrationandexpertiseintheBPMS(s),thetechnicalenvironmentofthecompany,anunderstandingofbusinessoperations,andBPMexpertise.”–DanMorrisandRajuSaxenainapapertitled“TheNeedforaBPMCenterofExcellence”(ABPMP).

AProcessManagementCenterofExcellenceisneeded(atleasteventually)toprovideconsistencyofapproachthroughthecreationofpolicyandstandardsatprocesslevelandlower,morefocusedBusinessUnit‐levelchange,operationmanagement,andamovetocontinuousimprovement.ThisCoEwillworkwithothercompanyCoEstocoordinatestandardsandavoidoverlap,conflict,andalackofclarity.

TheneedtoconcentrateProcessManagementexpertisewillbecomeevidentatsomepointinyourcompany’sevolutiontoaprocessperspective—aperspectivethatallowsmanagersandProjectTeammemberstolookatprocessesfromendtoendanddrilldowntoanypartoftheprocessandtheBusinessUnitthatperformsit.AssumingthatagoodBPMSisusedasthebaseenterprisebusinessmodelingtool,managersandProjectTeammemberswillalsobeabletostartataBusinessUnitorgreaterlevelofdetail,thenfollowtheworkupwardtoseetheentireprocess,andmodeltherippleofchangestoanypartofthework.

ProcessManagers(discussedabove)maybepartofthisProcessManagementCoEortheymaybeseparateandmorefocusedonmanagingtheprocesstheyareresponsiblefor.Ifthisisthecase,theProcessManagerswilldrawontheProcessManagementCoEtoprovidetheguidancenecessaryforapproachconsistency,modelconsistency,reportingclarityandconsistency,andProcessChangemethodology.

ThisrecognizestheroleoftheProcessManagementCoEstaffasinternalconsultantsthathelpProcessManagerswithchangeprojects.Assuch,theCoEstaffmustbeexpertsintheapproaches,concepts,method,techniques,andtoolsusedinProcessManagementandProcessChange.Theymustbefamiliarwiththestandards,rules,andpoliciesthatwillgovernProcessManagementandProcessChangeinthecompany,andtheymustknowtheplayersandthepoliticsinthecompany.

9.6.1 Benefits to the Organization

ThemainbenefitstothebusinessfromaProcessManagementCoEarethedeliveryofProcessManagementconsistencyandthecoordinationofgovernance,standards,techniquesandmethodologyusedbytheProcessManagers.Justastheirrolesfocusonconsistencyincoordinatingworkandchangeintheirprocesses,theythemselvesshouldbegovernedandtheirworkcoordinatedbycommonapproachesandrules.

Copyright A

BPM


361

ThisisimportantinestablishinganynewCoEortakinganexistingCoEtothepointwhereitcansupportconsistencyacrossthecompany.

Butwithconsistencycomeslimitation.ThislimitationshouldnotreplaceorpreventinnovationandcreativityinthewayProcessesareviewed,managed,orchanged.ItisratherthejoboftheCoE’sinternalconsultantstopromotethesequalitiesintheprojectsthatwillimprovetheProcess’soperation.

Finally,theCoEwillbeabletoworkwiththeDataArchitectstodeterminethe“systemsorsourcesofrecord”fordata.Thesearetheplaceswherethehighestqualitydataavailablecanbefound,whichbecomesthefoundationforreporting.ThiswillbesupportedbythecreationofcommonperformancemonitoringandreportingrequirementstomakecertainthatthesametypeofinformationisavailableandreviewedbyProcessandBusinessUnitManagersontheProcessManagementcommittees.

9.6.2 Typical Roles

ThereareatleastthreedistinctrolesinProcessManagement.Theseare

TheProcessManager,whowillmonitorallactivityintheprocessandhelptheBusinessUnitManagersworkwiththeotherBusinessUnitManagerswhocontributetotheprocessanditsproducts.Thisisameasurementandproblem‐solvingrolethatinvolvescreatingandcoordinatingcommitteesofBusinessUnitManagerswhoperformtheworkoftheprocess.Thisrolehelpsidentifyproblemsintheprocess,recommendscorrectiveorimprovementaction,managesprocess‐levelchangeprojects,andhelpsthevariousBusinessUnitManagersworktogethertogoverntheoperationoftheprocess.

TheProcessChangeManager,arolethatmayormaynotbetheresponsibilityoftheProcessManager,whomustfocusonoperationalissuesfirst.IfthisroleisassignedtosomeoneotherthantheProcessManager,thatpersonshouldreporttotheProcessManager.TheProcessChangeManagerisanadvisororinternalconsultantwhoisfocusedonchangefortheprocess—heorsheisnotoperationallyfocusedandisnotinvolvedinmanagingtheday‐to‐dayactivitiesoftheprocess.Rather,thispersonisresponsibleforimprovementandcontrollingoftheimpactonupstreamanddownstreamworkofanychangesinbusinessoperation,rules,data,orreporting.

TheProcessConsultantisaninternalroleprovidedbytheProcessManagementCoE.Peoplefillingthisroleareexpertsincontrollingprocesschangeandinthestandards,policies,techniques,etc.thatareusedinthecompanytogovernprocesschange.

9.6.3 Responsibilities

ProcessManagementinvolvesonlyafewresponsibilitiesatahighlevel.Theseare:

Copyright A

BPM


362

Provideanend‐to‐endprocessviewtoBusinessUnitManagerswhoareinvolvedintheprocess

CreateProcessperformancemonitoringandmeasurement CoordinatetheProcessManagementBusinessUnitManager’scommittee ControlchangeattheprocesslevelandreviewBusinessUnitChangeto

ensurethatthereisnoimpactupstreamordownstreamintheprocess Provideconsistencyinapproach,technique,andmethod IfthereisaProcessManagementCoE,toworkwiththeCoEtocreate

standards,policiesandgovernancerules.

9.7 BPM Integration in Support of Process Management

ProcessManagementisverydifficulttoimplementandperformwithouttheimplementationofasupportingBPMdisciplineandwithoutBPMStools.Why?Becauseofthescopeofactivityandinformationthatmustbedealtwith.BPMisprocess‐andworkflow‐oriented.Assuch,itismeanttolookatprocessmanagementandimprovement.Sinceitusesworkflowmanagementasthefoundationforprocessandactivitiesasprocessbuildingblocks,itisdesignedtohelpmanagersdealatalllevelsinthebusiness.

Second,theProcessManagementfunctioncaneitherfocusonbusinessandBPMoronthetechnicalsideanddealwithEnterpriseArchitecture—whichtodayistryingtomoveoutoftheITinfrastructuretoincludebusinessprocess.ABPMP’srecommendationis,ofcourse,tolookatprocessfromabusinessperspectiveandsupportimprovementthroughtheuseofbusinessredesigntechniquesandaBPMStoolsuite.

AthirdreasontointegrateBPMandProcessManagementisthetools.BPMStoolsprovidetheautomatedsupportneededtounderstandprocessesandmonitoractivity.Thesetoolscreateanewoperatingenvironmentthatallowsmanagerstotrackprogressinnear‐real‐timeandaddinSixSigmaqualitymonitoringsystems,costtracking,andmore.TheyalsoallowProcessManagerstoworkwithBusinessUnitManagersandsimulateproposedchangeattheprocessortheworkflowlevels,thenlookatthepossiblerippleeffectofthechangeonotherBusinessUnits.

Built‐insecurityalsoallowstheBPMStoolstocontrolwhoviewsinformationandwhattheycandotoit:read,addtoit,orchangeit.Thisiscriticalinprocesseswherepartsoftheworkareoutsourcedorpartsoftheworkareperformedindifferentgeographicallocations.Becauseoftheinformation‐deliverycapabilities(models,rules,etc.),thesetoolsallowallmanagersinanypartoftheprocesstounderstandhowtheirworkfitsinandhowtheirstaffcontributestotheendproductorservice.

Finally,theBPMStoolsallowProcessManagementstandardsandpoliciestobetranslatedintorulesthatwillcontrolwork,decisions,governance,andreporting.TheserulesarelinkedtotheProcessandworkflowactivitiesandprovideconsistency.

Copyright A

BPM


363

9.7.1 Fit in the organization

ProcessManagementshouldbeaseparatestructureinanycompany.Itmustbeindependentofthebusinessunitsthatsupportaprocessanditshouldhavedifferentperformancetargetsthanthegroupsitworkswith.Insomerespects,ProcessManagementshouldbeprovidedthroughaseparatetypeoforganization.AtthetoplevelistheProcessManagementExecutiveorChiefProcessOfficerwhoshouldreporttotheSeniorManagementCommittee.TheindividualProcessManagersorProcessOwnersshouldreporttothisexecutivemanager.ProcessChangemanagerswillreporttotheseProcessOwners.

TheChiefProcessOfficerisobviouslyresponsibleforthehealthofalltheprocessesinthecompany.TheProcessManagersowntheprocessestheyareresponsiblefor.ThesepeoplewillcreateProcessManagementCommitteeswiththeBusinessUnitManagerswhosestaffdotheworkneededtobuildthecomponentsoftheprocess’sproductsorservices.Indoingthis,theProcessManagerswillinteractwithIT,collaborativepartners,outsourcers,andvirtuallyalltheCentersofExcellenceinthecompanytoidentifyproblems,opportunitiesforimprovement,cost‐cuttingmeasures,andqualityimprovementchanges.TheywillalsoberesponsiblefortheprocessviewmodelsintheBPMSandthe(high‐level)processbusinessrules.

ProcessManagerswillworkwiththeirBusinessUnitManagerCommitteestorecommendprojectsandbuildbusinesscasesthatthemanagerswillagreetoandsign.

ProcessChangeManagerswillberesponsibleformodelingandgoverningchangeintheprocess.Themostdifficultpartofthisroleisbuildingtherelationshipswithlinemanagersandstaffneededtoidentifylow‐levelruleandactivitychangesotheycanbeaddedtotheworkflowmodelsandruleslibrary.Thisupdatingisacriticalactivityneededtokeeptheoperationanditsmodelsinsync.

Inaddition,theProcessChangeManagerswillberesponsibleforworkingwiththeBPMSandtheProjectTeamstomodelandsimulatethechangetoidentifypotentialimpactsupstreamanddownstreamintheworkflowandprocessflow.

ExternaltothismainProcessshadoworganization,butrelatedtoit,istheProcessManagementCoE.TheCoEstaffareprocessconsultantswhoworkwithalllevelsofProjectManagementmanagerstoadvisethemonstandards,techniques,rules,andmethodsastheyperformimprovementprojectsandmanagetheprocesses.

9.7.2 Role of IT in Process Management

Aswithallpartsofanybusiness,ITprovidestheinfrastructurethatenablesandlimitsautomatedsupport.ThisisastrueinprocessmanagementasintheBusinessUnit‐focusedapplicationsystems.ThedifferenceinsupportingProcessManagementisthattheapplicationsaregenerallydesignedtosupportoperationalactivityandnotprocess.

Todayitisusuallydifficulttoidentifyalltheapplicationsthatsupportanyprocessandthedatatheycontain.Itisalsoalmostimpossibletotrackactivityacross

Copyright A

BPM


364

processesandidentifythestatusofwork.ThisvoidcanbefilledthroughtheuseofBPMStechnology,whichcanmodeltheprocessandthenmonitorthemovementofactivityandthequalityofwork.However,thiswillmeanthataprocess‐levelmanagementstructurewillneedtobebuilt.

Becausethistypeoftrackingandreportingcannotbeeffectivewhenmanual,someformofautomatedtrackingandreportingisneeded.Generally,thissupportcanbebuiltquicklyusingaBPMS,whichcanmonitorworkandaddinmetricsfromothertrackingapplicationsindifferentpartsoftheprocess.Thistypeofapplicationsupportisneededtomonitoractivityandprovidenear‐real‐timedashboardreportingwithalertsandinference‐basedguidance.

However,buildingthissupportwillrequireanappropriateITinfrastructureandaBPMStool.ThatmayormaynotbepossibleinyourcurrentITenvironment.Itmaybenecessarytodothebestyoucanusingsimplemanualtracking,recognizingthatthistrackingwillbehigh‐levelandincomplete.

9.7.3 Enterprise or Business Architecture and Process Management

Eachoftheseapproachesisuniqueandoffersdifferentsupport.Buttoformacompletepictureofthebusinessoperation,allshouldbepresent:

Enterprise Architecture:Alookatthebusinessoperationfromatechnologypointofview.

Business Architecture:Alignmentofthestrategyofthecompanywithbusinesscapabilitiesandthroughthemtobusinessfunctionsandprocesscomponents.ThattiesstrategyandcapabilitytoprocessandBusinessUnits.

Process Management:Theend‐to‐endviewandmanagementofactivityacrosstheentireprocessand,atalowerlevel,theworkflowsthatmakeuptheprocess.

Eachofthesedisciplinesandmodelsaddssomethingthattheothersmiss.Withacenterofprocess,EnterpriseArchitectureprovidesacompletepictureofhowITapplicationssupportactivityandhowtheinfrastructuresupportsapplications.BusinessArchitecturemodelsprovideagreatpictureofthebusinessfromaperspectiveofwhatneedstobedonetodeliverproductsorservices.Thisdefineseffectivenessinthebusiness.ProcessManagementnowaddsthe“how.”Itdefineshowworkmustbedoneandhowitchanges.Althoughitisdifficulttodobecausetheseproductsandthegroupsthatownthemareseparate,itispossibletopullthisinformationtogetherandofferacompleteviewofanyprocessoranylevelofdetailinaprocess.

9.7.4 Continuous or Quality Improvement initiatives

ProcessManagementmustdelivercontinuousimprovementinallProcessesand,atlowerlevels,supportimprovementintheBusinessUnits.ThatisthegoalofimplementinganyProcessManagementprogram.Buttodothis,theinformationthatformstheviewanddefinestheoperationmustbereusable,andtheProcess

Copyright A

BPM


365

Managersmustbeabletoupdateandusetheinformationquickly.Ifthisisnotavailable,theeffortwillslowandbecomeoverhead.

Interestingly,assoonasanythingbecomesoverheaditisdeemedunnecessaryanddropped.

ItisthusimportantthatanymovetoaprocessperspectiveandProcessManagementbethoughtoutandsupportedbyexecutivemanagementthroughbudgetandmandate.Itshouldalsoberecognizedthatamovetothisapproachcannotoccurquicklyorwithoutconsiderablework.Evenwiththissupport,anymovetoimplementacontinuousimprovementprogrammustprovideanabilitytochangequickly—veryquickly.Thereasonisthatthebusinesswillchangecontinuouslyandanychangethattakesalongtimewilldeliverasolutionthatmeetstheoldneedsoftheoperation,notthenewneeds.So,speedofchangeiscritical.

ThiscanbeprovidedthroughtheBPMSanditsabilitytoquicklymodelanditerate.Withthiscapability,changesinaprocessoratalowerworkflowlevelcanbemodeled,simulated,tested,anddeployedindaysorweeks,insteadofmonths.Thisalsoallowsmanagementtotracktheoutcomeofchangesandmakecertainthattheoperationisimproving.

Copyright A

BPM

P International

Chapter 10

BPM Technology

Copyright A

BPM

P InternationalChapter10.BPMTechnology

367

Foreword by Dr. Mathias Kirchmer, Executive Director BPM and Global Lead Business Process Management‐Lifecycle (BPM‐L) Practice, Accenture

BusinessProcessManagement(BPM)hasbecomeamanagementdisciplinethattransfersbusinessstrategyintoITandpeople‐basedexecution—atpacewithcertainty.BPMtechnologyiskeytodeliveringonthispromise.Ithelpsincreatingthetransparencynecessarytoachieveconflictinggoalslikequalityandefficiency,agilityandcompliance,orinternalalignmentandexternalintegrationintoenterprisenetworks.BPMsystemsenabletheimplementationof“processestochange”wherethisisappropriate.ThehighlevelofmaturityofmanycomponentsofBPMtechnologyisalsoareasonfortheincreasinginterestinBPM.NowBPMpractitionerscanfocusonbusinessoutcomesandlineupthenecessarytechnologyaccordingly.Wecanmovetowards“value‐drivenBPM.”

BPMtechnologysupportstheentirelifecycleofabusinessprocess,fromdesignthroughimplementationtoexecutionandcontrollingofprocesses.ItsupportsthelinkingofstrategytoprocessesthroughanappropriatedesignusingBusinessProcessAnalysis(BPA)toolsandconvertsthatstrategyintoanagileexecutionusingBPMautomationengines.ProcessPerformanceManagementandBusinessActivityMonitoring(BAM)systemsshedlightonrunningprocessesthatenableeffectivecontrolling.Newarchitectures,suchasService‐OrientedArchitectures(SOA),supporttheagilityofIT‐supportedbusinessprocessesevenmore.TheresultingagilitywillagainbeincreasedthroughnewapproachessuchasSoftware‐as‐a‐Service(SaaS)orCloudcomputing.BPMsystemsalignsoftwarecomponentswiththebusinessneedsofprocesses.Theuseofsocialmediaresultingin“SocialBPM”createsopportunitiestointegratethepeopleandITdimensionofBPM,deliveringevenhigherperformanceofthepowerfulmanagementdisciplineBPM.

TheagileBPMtechnologyrequiresappropriategovernancearoundit.Thisisthebasisforcreatingrealvaluethroughthisnewlevelofagilityandscalability.BPMgovernancemakessurethattechnologyisconsistentwiththepeoplerequirementsandthatbotharealignedtoproducebestvaluefortheorganization.GovernanceisanintegratedpartofaBPMtechnologyapproachandstrategy.

ThefollowingchaptergivesyouanoverviewofthestatusanddevelopmentofBPMtechnology,aswellastherequiredgovernancecomponent.ItpositionsthisimportantaspectofBPMinthelargercontextofanoutcome‐focusedBPMmanagementdisciplinethataddsrealvaluetoanorganization.

Copyright A

BPM


368

Contents

ForewordbyDr.MathiasKirchmer,ExecutiveDirectorBPMandGlobalLeadBusinessProcessManagement‐Lifecycle(BPM‐L)Practice,Accenture.................367

10.0 Introduction.........................................................................................................................370

10.0.1 AnIntroductiontoBusinessProcessManagementtechnology...........370

10.0.2 ABusinessPerspective...........................................................................................372

10.1 EvolutionofBPMTechnologies..................................................................................372

10.2 BPMTechnology:EnablingBusinessChange.......................................................373

10.2.1 OverviewofBPMTechnology............................................................................375

10.2.2 Whatisit?Capabilities..........................................................................................376

10.3 CapabilitiesofBPMtechnologies..............................................................................380

10.3.1 BusinessProcessAnalysis(BPA).......................................................................383

10.3.2 EnterpriseArchitecture(EA)..............................................................................385

10.3.3 RulesEnginesorBusinessRulesManagementSystems(BRMS)........386

10.3.4 BusinessProcessManagementSuites(BPMS)............................................389

10.3.5 BusinessActivityMonitoring(BAM)................................................................394

10.3.6 EnterpriseApplicationIntegration(EAI).......................................................395

10.3.7 SOA.................................................................................................................................395

10.3.8 EnterpriseServiceBus(ESB).............................................................................401

10.3.9 ExternalBPMEnterpriseTransactionDataRepository.........................401

10.4 MakingBPMtechnologiesworkforyou.................................................................403

10.4.1 BPMInfrastructureArchitecture.......................................................................403

10.4.2 BusinessandDataRequirementsDefinition................................................405

10.4.3 TeamCollaboration.................................................................................................406

10.4.4 UnderutilizedCapabilities....................................................................................407

10.4.5 DecisionSupportandPerformanceManagement.....................................407

10.4.6 Buy‐inandMonitoring..........................................................................................408

10.4.7 Setup..............................................................................................................................409

10.5 BPMSGovernance.............................................................................................................409

10.5.1 BPMStandardsandMethodologies..................................................................410

10.5.2 GovernanceModels..................................................................................................411

Copyright A

BPM


369

10.5.3 DataIntegrity............................................................................................................412

10.5.4 EvolvingasTechnicalStandardsChange......................................................414

10.6 ComingSoontoHelpDeliverFlexibility..................................................................415

10.6.1 BPMandSaaS.............................................................................................................415

10.6.2 NetworkClouds.........................................................................................................416

10.6.3 SocialNetworking....................................................................................................417

10.6.4 DynamicBusinessApplications........................................................................418

10.7 VisionoftheFuture.........................................................................................................418

10.8 Summary:AdvantagesandRisksofProcessAutomation...............................420

10.9 KeyConcepts......................................................................................................................420

Copyright A

BPM


370

10.0 Introduction

BPMisacomprehensivemeldingofBusinessProcessReengineering,BusinessProcessImprovement,andBusinessProcessManagementmethodsandtechniquesthataredesignedtodeliverbothimmediateandlong‐termimprovement.ThesemethodsandtechniquesmaybesupportedbyBusinessProcessManagementSuites(BPMS)oftoolstoachieveBusinessImprovementorevenTransformation.Whencombined,anewtypeofBPMS‐supportedBPMenvironmentiscreated.

ThisenvironmentprovidesanewlevelofautomationthroughapplicationdefinitionwithintheBPMS.Combiningthelogicshowninthebusinessmodelswiththerulesanddatathatarelinkedtoeachactivity,thesetoolsthensupportthegenerationofbusinessapplications.ThisabilitytodefineandgeneratesupportingapplicationsfrommodelsandrulesallowstheBPMStoofferunprecedentedworkflowmanagementandimprovedflow‐statusreporting.Italsoimprovescontroloverworkqualityandactivitytiming.

Inthisoperatingenvironment,thebusinessactivityisactuallysupportedwithintheBPMStechnicalenvironment,withtheBPMScontrollingallaspectsofITsupport.ThismovestheBPMStoacontrollingroleintheorchestrationofanysupport.Assuch,itisresponsibleforcallinglegacyapplications,usingwhatisneeded(screens/functionality),controllingdatausewithinthejobthatisbeingperformed(followingbothtraditionalandServiceOrientedArchitecture—SOAapproaches)andthenmixinganddeliveringdatawhereitwillbestored.

AlthoughaBPMS‐supportedBPMoperatingenvironmentoffersmanyadvantages,thethreemainbenefitsitcreatesare

Speed,throughapplicationmodelingandgeneration Quality,throughanabilitytoexternalizerulesandthentestthem

individuallyandingroups Flexibility,throughrapiditeration.

10.0.1 An Introduction to Business Process Management technology

ThetechnologythatsupportsBusinessProcessManagementisrapidlychangingaseverymajorvendorconstantlymonitorsthecompetitionandmarketinanattempttoreadthemarket,anticipatecorporateclientneeds,andofferfeaturesthatmaketheirsuiteseasiertouseandmorefunctionallyrich.

Copyright A

BPM


371

BusinessProcessManagementOperatingEnvironment:BPMtodaymeldsBusinessProcessReengineeringmethodsandtechniqueswithBusinessProcessManagementSuite(BPMS)automationcapabilitiestoachieveradicalBusinessTransformation.Inthisemergingenvironment,theBPMteamsusethefullspectrumofBPMStoolstodeliverbusinessandITchange.Together,BPMandBPMSformanewoperatingenvironmentthatintegratesnewbusinessmanagementautomationwithlegacyproductionapplicationstoopenaccesstodataandfunctionality.ThisisusuallycreatedbyconsideringmostactivityaswebservicesandleveragingthepoweroftheInternettoprovideaccessandmoveinformation.Theprimaryadvantageofthisenvironmentisthespeedofapplicationdevelopment,thecontinuingimprovementthatcanbedelivered,andtheflexibilityitprovidesinchangingthebusinessoperationandITsupport.

BPMtechnologyhasbeenchangingrapidlyoverthepast15yearsasvendorsleapfrogoneanotherinaracetoprovidethebestbusinessoperating/changeenvironment.Inthisracetoprovidesupportandthuscapturemarketshare,vendorconsolidationhasbecomeacommonoccurrence.TworecentexamplesareSavvion(nowProgressSoftware)andLombardi(nowpartofIBM),bothofwhomhavebeenpurchasedandarebeingintegratedintootherofferings.Forexample,LombardiBlueprinthasbeenchangedbyIBMintoaproductnamedBlueworksLive.

Thisconsolidationhasbeenasignificantfactorinproduct‐lineextensionandfunctionalityenhancement,asvendorspurchasepartsoftheiroverallproductsuitesandthenintegratethem.Vendorpartneringhasalsobeencommon,asmanyvendorshaveincorporatedothervendors’components,suchasrulesengines.But,whilethisconsolidationiscommon,somevendors,suchasPega,haveresistedandhavebuiltmostoftheirtoolofferings.Thislatteroptionisnowcontinuingasothersarestartingtoreplacepartneredpartsoftheirtoolsuiteswithinternallydevelopedorpurchasedofferings.

Clearly,theBPMSmarketplaceisanythingbutstable.Thistrendislikelytocontinueasfirmsareboughtandmerged.However,thisisactuallyfarfromaproblem,asitisdrivingarapidexpansionofcapabilitiesandageneralimprovementinproductqualityandstability.

Thepastisclearlyshowingusthatwhiletoolevolutionwasfairlyslowduringthelate1980sand1990s,itgainedmomentumintheearly2000s,andthepaceofitsevolutionisincreasing.Today,thevarioustoolsuitesofferanunprecedentedleveloffunctionalityandeaseofuse.Andwhilemanybelievethatthedirectionisclearlytomovemuchofthetraditionalroleoftechnicianstobusinessprofessionals,wearestartingtoactuallyseeanewlevelofcollaborationastherolesofboththebusiness

Copyright A

BPM


372

userandtheITtechnicianblendintheanalysisanddefinitionofneeds,rules,anddatause.

ThisblendingisactuallyleadingtoaredefinitionofrolesandwaysinwhichITandthebusinessoperationsinteract.ItwillnownotbelongbeforetheseparationbetweenITandthebusinesscommunity,whichhascausedsomuchtroubleinthepast,willbereducedtosimplydealingwiththemoretechnicalaspectsofdatamodelingandinfrastructure.Amongthekeydriversinthisbridgingisthefactthatthetraditionalwayoflookingatbusinessrequirementsdefinition,thedesignofsystemsfromspecs,andtheseparationofdatafromthebusinessindesigningsystems,isverydifferentinaBPMenvironment,whichmakesthetraditionalformstoalargedegreeunnecessary.

TheseandotherapproachdifferencesareadirectresultofthefunctionalityprovidedbyBPMSsandthefactthattheyprovidetheirownoperatingenvironment,wherethetechnologycannotbeseparatedfromthebusinessoperation.

ThischapterdiscussesthesepointsandtheirimpactontraditionalITconcepts.Italsolooksathowthistechnologycanbeusedtocreateaverydifferenttypeofbusinessoperatingenvironment.

10.0.2 A Business Perspective

TheABPMPCBOKwilladdressthistopicfromabusinessmanagerorstaffmember’sperspective.Thisisthusabusiness‐orienteddiscussionofatechnicaltopic.Technicalconceptsandtermsarediscussed,butthediscussionsarenotdetailedtechnicaldiscussions.Theyareratherpresentedinawaythatprovidesthebackgroundthatabusinessmanagerorabusiness‐sideBPMprofessionalshouldhavetounderstand.Thepresentationisthusfairlybroad,butatabasicleveltoshowhowtheBPMtechnologiesworkandtheissuesthatmustbelookedatwiththeITBPMSdeveloperorBPMtooltechnician.

Businessmanagersandstaffshouldreadthisdiscussionbecauseitmaywellhelpthemtounderstandthetechnicalconcepts,approaches,andconsiderationsthatwillaffectthem.

TechnicalBPMprofessionalsshouldreadthischapterbecauseitwillacquaintthemwiththeissuesandaspectsofthetopicthatareimportantfromtheirbusinessclient’spointofview.

BPMtechnicalstandardsandadetailedtechnicaldiscussionarethusnotaddressedinthischapter.

10.1 Evolution of BPM Technologies

BPMtechnologyhasitsrootsinsimplemodelingtools.Thesetoolswereintroducedintheearly‐tomid‐1980sandevolvedthroughoutthe1990s.Inthisevolutionthetoolsbecamemorecapableofreflectingthebusinessoperation,andwiththeadditionofrulesenginesandapplicationgeneratorsintheearly2000s,thetoolsuitesstarteddownadifferentpath—theyevolvedintoapplicationoperation

Copyright A

BPM


373

environmentswiththegeneratedapplicationsbeingexecutedbyandwithintheBPMS.

TodayBPMtoolshaveevolvedintotwobasiccategories.Thesearestandalonesingle‐purposetoolsandintegratedgroupsoftoolsthattogetherformBusinessProcessManagementSuites.Theadventofthesetoolsisfairlyrecentandtheyarestillmaturing.

Standalone single‐purpose tools

Thesetoolshaveprovidedcompaniestheabilitytoinexpensivelylookat,andforthefirsttimedefine,theirprocessesandworkflows.Theyalsohaveallowedcompaniestolookattheirbusinessrulesandoftenuncoverinconsistenciesandconflicts.Buttheiruseislimited,andalthoughtheydoprovidegoodsupport,theydonotallowcompaniestomovetoanenvironmentwherethemodelsandrulescanbuildnewbusinessoperationsandsystems.

BPMS

Between2003and2005thefairlysimpleapplication‐generationcapabilitiesofthebettertoolsuitesunderwentachangeandevolvedtoprovideagenerationofindustrial‐strengthapplicationscapableofsupportingcomplexlogicandlargetransactionvolumes.ThesetoolsbecamesuitesofmodularproductscalledBPMS,orBusinessProcessModelingSuites.Throughoutthistime,thesetoolsalsomovedtoanewstatus:theybecamebusinessoperating“environments.”TheapplicationsthataregeneratedareactuallyoperatingwithintheBPMSandthebusinessnowlogsintotheBPMSenvironmenttorunthebusiness.Nowthemodelsdefinethebusiness(context)andrules(logic,whatdatatogetandfromwhere,andwhattodowithit),andtheformsprovidethescreendesigns(withinthecontextoftheiruse).IfanSOA‐compliantdatalayerisavailable,thelegacyapplication’sfunctionalityisopenandthelegacydatacanbeeasilyfound.

Buttheevolutionhasnotstoppedwithapplicationgeneration.Today,manyvendorsboastsimulationmodelingthatiscapableofdealingwithcomplexsimulation.Thisallowscompaniestolookatpossiblealternativesandselectthebestpartsofthesealternativesinordertocomeupwithoptimalbusinessdesigns.AndwhenSOAisadded,companiescannowchangequicklybyleveragingexistingmodelsanddata,changingthem,simulatingthechangestoreachoptimalresults,tieintolegacydatathroughSOA,andthengeneratenewapplications.

Whilethisispossiblenow,itisseldomdone.ThereasonisthatfewcompaniesreallyunderstandthatthisisavailableandfewhavehadtheluxuryoflookingatBPMasastrategictoolsuiteinsteadofawaytodealwithspecificproblems.Butthisuseischanginganditwillcontinuetochangeascompaniesrealizetheflexibilityofthistypeofenvironment.

10.2 BPM Technology: Enabling Business Change

BPMtechnologyhasbeenevolvingforover20yearsasithasmovedfromsimpleworkflowmodelingtoolstocomplexintegratedtoolsetsthatprovideacompleteoperatingplatformandenvironment.Today’stoolsuitesvaryconsiderablyintheir

Copyright A

BPM


374

sophisticationandfunctionasmanyvendorstrytosupplytoolsfordifferentneedniches.Butitisnowpossibletolicenseverysophisticatedstandalonemodelers,rulesengines,simulationengines,performancemodeling/monitoring/reportingandotherspecial‐purposetools.Itisalsopossibletobuycloselyintegratedgroupingsofthesetoolstoprovideaseamlessoperatingenvironment,asisfoundintheleadingBusinessProcessManagementSuites(BPMS).

Theindividualstandalonetoolsoffermodelreuse,rulesrationalization,operationalvisibility,andmore.Theyhaveaplaceandarebeneficialwhenusedwithintheirfocusarea.However,foravarietyofreasons,somecompaniestrytousethesetypesoftoolstoprovidesupportbeyondtheirdesignintention.Aswithalltools,whenused“creatively”(inunintendedways),theycanencounteravarietyofproblems.Inmanycases,these“usepushes”areanefforttofulfillneedswhentoolscannotbeswitchedtomorefunctionallyrichonesorwherethecompanyislockedintoaninflexibletechnologyenvironment.Inthesecases,thedevelopersmayhavelittlechoice,butextracareshouldbetakenwhenitisnecessaryto“push”anytoolbeyonditsintendeduse.

Whiletheindividualstandalonetoolsoffersignificantcapabilities,thesetoolswillnotdeliverthemajorbenefitsoftheBPMS,suchasspeedofchange(whichallowscompaniestoevolvequicklyandoptimizetheiroperations),becausetheywereneverintendedtodoso.TheintegratedBPMSs,ontheotherhand,weredesignedtodeliveracompleteoperatingenvironmentwherethemodelsandrulesworktogethertogenerateapplicationsthatexecutewithinthetoolenvironment.

Inthesetoolsuiteenvironments,oncethemodelsaredefined,therulesdefinedandplacedinthetoolsuite’sruleengine,andthedataisdealtwith,operationalchangealongwithapplications‐changecanhappenveryquickly.Itisthisspeedofchangethatallowsbusinessestoevolvequicklyenoughtooptimizetheiroperationsandsustainthatoptimization.However,thisabilityisrelatedtothedifficultyindealingwithdataandlegacyapplications.CompaniesthathavemovedtoaServicesOrientedArchitecture(SOA)environmenthavetheabilitytodealwithdataquicklyandeffectively,supportingafastermethodofchange,thandocompaniesthatoperateusingthemoretraditionalwaysofdealingwithindividualapplicationinterfacesanddataaccess.

ButeveninmoretraditionalITenvironments,theBPMSsallowtheuserstomovequicklyinredesigningthebusinessoperationandhowitwillwork.Thesetoolsalsoallowtheanalysttocapturesupportinginformationandenternotesintothedatascreensthatsupporteachsymbolusedinthemodels.Thisinformationcanthenbeviewedinavarietyofwaysandatdifferentlevelsofdetail.Itcanalsobeusedinsimulations.ThisallowsITtounderstandthedataneeds,legacyapplicationinterfaces,anddata‐usemuchfasterthanmoretraditionalapproaches.Italsoallowsamuchmoremodularapproachtolookingatfunctionalityevolutionandcostreduction.Thesemodulesareoftenreferredtoasservices.This“modularity”iswhatallowsdataaboutthebusiness,businessmodels,rules,andmoretobereusedandsimplymodifiedatthemodelleveltoregeneratemodifiedapplications.

Copyright A

BPM


375

ThisdeliversontwointegratedBPMSpromises:theadvantageofspeedofchangeandtheabilitytolookattheoperationatvariouslevelsofdetailwithimmediateaccesstorelevantinformationonhowtheoperationreallyfunctions.

However,steppingbackfromthehigh‐endBPMSproducts,significantbenefitcanalsoberealizedfromindividualmodelingtools,rulesengines,SOAandotherBPMScomponents.Forexample,manybusinesseshaveneverhadtheadvantageofanend‐to‐enddetailedviewoftheirbusinessoperationorprocesses.ManymorecangainseriousimprovementsinsimplifyingITandinopeningaccesstodatathroughSOA.SoBPMisnotanall‐or‐nothingprospect,norisitaone‐size‐fits‐allapproachtoimprovement.ButBPMSproductflexibilitydoessuggestaneedtocreateaBPMorbusinessimprovementstrategyandthenbuildthebusinessandtechnicaloperationstoadheretoitwithitstooluseandimplementationstandards.

ThischapterprovidesthefoundationneededtoconsiderhowaBPMS‐drivenBPMenvironmentcanprovideacompetitiveadvantageandhowtheuseofindividualBPMStoolscanstartyoudownapathtocontroltheevolutionofthecompany.(See“EvolutiveManagement”inchapter5.)

10.2.1 Overview of BPM Technology

BusinessProcessManagementSuites(BPMSs)provideanewtypeofbusinessenvironmentthatmeldsthebusinessandIT.Weusetheterm“environment”todescribetheresultingoperationwhenusingaBPMS,becausethesetoolsuitesgeneratetheapplicationsandprovidetheoveralloperatingenvironmentthroughwhichthebusinessandtheapplicationsrun.

Throughthebusinessmodelsinthesetools,thecontextforthebusinessoperationisdefinedasastep‐by‐stepframeworkofthebusinessoperation.Fromthesemodels,therequirementsforthedatause,legacyuse,andtechnicalsupportoftheoperationaredefined.Whenthescreensaredefined(asforms)inthebusinessdesigns,theyprovidethetouch‐pointinteractionlocationsanddatauserequirementsforthebusinessworker.Whentherulesaredefinedandaddedtothedesign,theydeliverthelogicor“thinking”thatthesystemwilldotosupporttheoperation.Withformsandrulestogether,theBPMScannowsimulatepossibledesignscenariosandevaluateoutcomesbasedontestingthatmirrorstherealwaytheapplicationwillbeused.Aspartofthissimulation,theapplicationsaregeneratedandtested—alongwithallinterfacestolegacyapplicationsandotherBPMS‐generatedapplications.Aftertesting,theapplicationsaremovedto“production”andthebusinessissupportedbyexecutingtheseapplicationsaccordingtotheframeworkshowninthebusinessworkflowmapsandtherulesthatdefinethelogic.

ThedataandinteractionbetweenpeopleandapplicationsaredefinedbyformandsupportingdatabaseschemasintheBPMtoolssuites,andthedatauseandtransformationaredirectedbyrules.Toprovidethedataneededtosupportthedatacallrules,itisusuallynecessarytodefineandconstructinterfacestothecurrentapplicationsandtheirdatabases,aswellastocurrentdatamarts.IncompaniesusingSOAtools,theseinterfacescanbesimplifiedthroughtheuseof

Copyright A

BPM


376

adaptorsthathelpdefinetheinteractionandthesystemsthatwilldelivertheflowofdatabetweenapplications.

TogetherthisformsacompleteoperatingenvironmentwherethebusinessoperationisperformedwithintheBPMSenvironment.However,withoutthenecessarymodulesfromacompleteBPMS,theenvironmentwillnotbeabletogenerateapplications,andthebenefitsfromflexibilityandspeedofchangewillnotbeavailable.

Althoughyoumaynotbeabletoaddressallissuesorsolveallproblemswithanytoolsuite,youwillneversolveanyproblemormakeanyimprovementunlessyouactivelylookattheoperationandhowitfunctions.Thisisnotaone‐timeactivity.Itisconstant,anditcreatesthefoundationforcontinuousimprovement.Inaddition,itisnecessaryformanagementtobeopentoideasandinnovativesolutions.Noonecanprovidealltheideasoranswers,butmanagerswithclosedmindsseldomachievethechangesthatthosewhoarewillingtotrynewideasachieve.Itisimportanttobuildachangeenvironmentthatpromotes“outside‐the‐box”thinkingandcontrolledimprovementexperimentation.Apartfromthesequalities,itisnecessaryformanagement,inordertobeeffective,tosupportimprovementideaswithachangeenvironmentthatallowstheideastobequicklydefined,designed,simulated,built,testedandimplemented.ThatiswheretheBPMStechnicalenvironmentcomesin.Thisenvironment(supportedbyafullBPMtechnologysuite)deliverstheabilitytosupportthoughtandthenquicklytoturnthatthoughtintodeployableaction.ThisiswhyaBPMStechnicalenvironment,whenusedtoitsfullest,canprovideacompetitiveadvantage.

10.2.2 What is it? Capabilities

Theterm“BPMtechnology”todaymeansdifferentthingstodifferentpeople—evenwithinasinglecompany.ThedifferencesstartwiththedifferingperspectivesbetweenbusinessandIT.Inbusiness,thetermBPMtechnologycanrefertosomethingsimplisticandlimited,suchastheuseoftoolslikeVisioforsimplemodeling,oritcanrefertotheuseofcomplextoolsandfullBPMSuites(BPMSs)forcomplexmodelingwithrulesdefinitionandgeneratedoperatingapplications.ThissideofBPMisfocusedonimprovingbusinessactivityandislimitedtotheprocessoptimizationaspectofchange.Inaddition,someorganizationswithmoreadvanceddocumentmanagementsystemsarenowbeingtoldthatthedocumentmanagementtoolsareBPMSs.Wewillleavethatasa“matterofopinion.”However,eventhesetoolsdohavesimpleworkflowmodelers.

FromtheITperspective,BPMtoolshaveoftenfocusedonServiceOrientedArchitecture(SOA)andEnterpriseApplicationIntegration(EAI).ThesetoolsareimportanttoITandarethefoundationofamovetoaverydifferentarchitectureforapplicationintegrationanddatadelivery.Ofcourse,thisperspectiveleavesouttheprocessmodelingandrulestools,whicharebusiness‐oriented.AttimesthistechnicalperspectiveincludesanEnterpriseServiceBus(ESB).ThisgivestheITgroupafocusonapplicationinterfacinganddatadelivery.

Copyright A

BPM


377

Inaddition,justtomakethingsinteresting,boththebusinessandITsidesarenowlookingataddingEnterpriseArchitecturetoolsintothemix.Thesetoolscanhavefairlyadvancedmodelersandaddtheabilitytomodelthetechnicalarchitecture,dataarchitecture,andmoreonthetechnicalside.Thesetoolsmaysoon“muddy”theBPMSdiscussion,butfornow,wecanstillconsiderthemasaseparategroupofenterprisemodelingtoolsmainlyforIT.

FromtheABPMPperspective,BPMStechnologyincludesboththeBusinessperspectiveandtheITperspectiveontoolsandtechnology.ItisthusbroadlyencompassingandBPMProfessionalPractitionersareexpectedtounderstandbothsidesofthetechnology,BusinessandIT.Tohave“understanding”doesnotmeanthatbusinessprofessionalsareexpectedtobecometechniciansorthattechnicalprofessionalsmustbecomebusinessoperationalmanagers.Itdoes,however,meanthateachgroupshouldhaveagoodunderstandingoftheneeds,work,andtoolsusedbyboth,andhowthetoolsandtheirusefittogethertoallowrapid,continuouschangeinacontrollednewoperation.

InadditiontothegeneralBusiness/ITdifferenceinperspective,thedifferencesindefinitionsofBPManditstechnologycontinue,basedoncompanyanddepartmentperspectives.

TheproblemisthatmanypeoplelookatBPMaccordingtotheircompany’sdefinitionandthefunctionalityBPMtechnologyprovidestotheirteam.Comprehensiveasitmaybe,acompanyperspectiveisoftenanincompleteviewbecausefewcompaniesuseBPMoraBPMStoitsfullest(usecompletesetsofBPMStoolsandallormostofthefeatures).Also,becausemanycompanieshaveusedBPMonlyinspecificsolutions,thetoolsuitesareoftennotkeptuptodateandthecompanyviewmaybebasedonexperienceswithpriorversionsoftoolsetsthataremorelimitedthantoday’scapabilities.

AddingtothisdefinitionandconceptproblemisthefactthatmanycompaniesarenowusingmultipleBPMSsfromdifferentvendors.Aseachvendorusestermsdifferently,thevariousdepartmentswillhaveadifferentvocabularyanddifferentmeaningsforcommonterms.Whenaddedtothedifferingdefinitionsforcommonlyusedtermswithinasingleorganization,thecommunicationissuebecomesaseriousimpediment.

Terminology,concept,andsophisticationcanthusbeexpectedtovaryamongthesegroups,asdoapproaches,anunderstandingofwhataBPMScando,andthewaydataaccessandusearegoverned.

Thedifferencesinperspectiveamonggroupsbecomeevenmorecomplicatedwhentheuseofthetoolsislimitedtospecificpurposesfordifferentgroups—suchastheuseofprocessmodelersforbusinesspeople,theuseofrulesenginesfortechnicalpeople,thegenerationofapplicationsasatechnicalfunction,thecreationofformsasabusinessfunction,andsoon.Thislimitedusealsonarrowspeople’sexposuretoBPMandBPMStoolsandcanimpacttheirunderstandingindividuallyorasgroups.

Copyright A

BPM


378

WhilethecapabilitiesofBPMtoolsandBPMSchangeconstantlyasthevendorsaddnewfunctionalityintheirefforttocompete,someversionofthiscorefunctionalitywillinclude

Processmodeling Simulationofnewdesigns Rulesdefinitionandmanagement Performancereporting Applicationgeneration(usuallysomewhatlimited) ServiceOrientedArchitecture(SOA)/EnterpriseApplicationIntegration

(EAI) EnterpriseServiceBus(ESB)

Thefeaturesandcapabilitiesofthesefunctionalcomponentsvarytodayandcanbeexpectedtovaryinthefuture.Anylookatcapabilitiesisthustime‐dependentandanystudymustbefocusedoncurrentinformation.Anoverviewofthecoresupportinthesemajorareasisprovidedinsection10.3.

AsshowninFigure67,BPMtoolscanbeviewedasprovidingdistinctfunctionality.Someprovidefullfunctionalityandothersarefocusedononeortwolevelsinthishierarchy.TheplacementofthefunctiononthisdiagramindicatesitsrelationshipstothebusinessonthetopandITonthebottom.

Thecategoriesoflevelswillbediscussedin10.3,buttheirrelationshipisdrivenfromthetopofthemodelinFigure67bythebusinessneeds,orfromthebottombytheITneedtobettercontroldataaccessanduse.TheRulesEnginecanbeusedwithalllevelsandspanstheuseofalltools.However,theRulesEnginewillseldombeusedaloneexceptbyITtohelpgetahandleontherulesinlegacyapplications.

Thetechnologylayersareatthebottomofthismodel.Theyprimarilydealwithdata,dataaccess,datamanipulation,datadeliveryovertheInternet,andinterfacesbetweenapplications.

Inuse,theprocessmodelingtoolsfeedthesimulationtools.ThesimulationtoolsareprimarilyfoundasmodulesinthemoreadvancedBPMSs.However,notalloftheBPMStoolshavethiscapability.ThesetoolsallowthebusinessandITmanagerstolookat“whatif”scenarios.Businessmodeldesigns,withsupportingvolumeandotherinformation,aremodifiedtorepresentdifferentbusinessscenariosandtestedinthesimulationtool.Thenewbusinessworkflowdesignandtherulesfeedtheapplication‐generationmodulesintheBPMSsanddrivetheneedfor,andrequirementfor,legacyapplicationuse,dataaccess,andinterfacing.PerformanceManagement(monitoringofreal‐timeworkandmeasurementoftrendswithBIreporting)canbebuiltintotheprototypenewdesigns,tohelpdeterminetheoptimizeddesignwithinthesimulationtool.TheBPMSapplicationscanthenbegeneratedandusedin“live”simulationsofthenewbusinesswithitsapplications.Legacyapplication‐useandlegacydatacanitselfbeaddedtothesimulationtoformacompleteversionofthebusinessoperation.

Copyright A

BPM


379

Differentversionsofthebusinessoperationcannowbeeasilybuiltandtested.Inthisapproach,SixSigma‐relatedtoolsarelinkedtothegeneratedapplicationsandhelppointtoareasofimprovement,whicharethenmonitored.

Figure67.BPMFunctionality

Oncetheoptimalsolutionisproven,interfacestolegacyapplications’functionalityanddatacanbebuilt(usingeitherSOAoratraditionalsingleinterfaceconstruction)andthefinalapplicationcanbemovedfromthesimulationenvironmenttotheproductionenvironment(withinIT)andimplemented.

ItisthiscapabilitythatallowsboththebusinessandITtocontinuallylookforimprovementsandquicklyrespondtonewbusinessandapplicationrequirements.Inthisnewoperatingenvironment,changeisquicklyanalyzedwithintheBPMSmodels;asolutionissimulatedandthenonceoptimal,movedintoproduction.Optimizinghereisafast,iterativeprocesswherethesolutionishonedusingperformancemeasurementtoolsandbusiness‐user“usetesting.”IntheBPMSenvironmenttheseiterationscanbebuiltandexecutedwithinhoursandnewbusinessoperation(withworkflow,application,managementcontrolandotherchanges)putinplace.

Whilethesetoolscanbesomewhatunbundled,theyonlydelivertherealpromiseofBPM(speedofchange)whentheyareallusedtogether.Thisisimportantbecauseitisonlywhenthisspeedofchangeisdeliveredthatbusinessoptimizationcanbereached.

Copyright A

BPM


380

Deliveringthisspeedofchangerequiresaninitialinvestmentinthecreationofbusinessprocessandworkflowmodels,thedefinitionofbusinessrules,andthebaselinemodelsandinterfacesforsimulationanddeployment.Thiscreatesanewintegratedbusiness/technologyenvironment.ChangesarenowmadeintheBPMS,and(BPMS)applicationsareregenerated.Interfaces,however,stillneedtobechanged.TestingnowneedstotakeplaceinthebusinessandinthenormalITtestingdonebythecompany.Thetime‐frameinthisenvironmentisverydifferent,withbusinesschangesthatoncetookmonthsoroverayear,nowcompressedintodaysorweeks.

ThiscapabilityisthebiggestbenefitofaBPMS‐supportedBPMoperatingenvironment.ItisalsotheadvantagethatcanbegainedfromusingaBPMSratherthanseparateprocessmodelingtoolsandseparaterulesengines.

10.3 Capabilities of BPM technologies

Components: Process Modelers, Application Generators, Rules Engines, PerformanceMonitoring, EAI/SOA, ESB

Tohelpfocusoncorecapabilitiesinthediagrambelow(BPMToolUse),rulesareincludedinProcessModeling,andEnterpriseServiceBusesareincludedintheEAI/SOAgroup.TheBPMSdatarepositoryisincludedaspartofeachlevel.However,itisgenerallyappropriatetousedatabasesthatareexternaltotheDBMSforseriousapplications.

Figure68.BPMToolUse

BPM Tool Use

showstherelationshipbetweenthefunctionallyorientedtoolgroupsanddefineswhateachgroupsupports.Businessmodelscontainthedefinitionoftheactivity,itsflow,itsrules,itsdatause,itsuserinterface,andthewayperformancewillbe

Copyright A

BPM


381

monitored.Here,detailedbusinessprocessmodelsareusedtodriveapplicationgeneration.Theapplicationgenerationwillsupportthesimulationofthedesigniterationsuntilanoptimaldesignandsupportingapplicationshavebeenidentified.The“solution”willthenbeputintoproduction,andperformancemeasurementandanalysiswilloccur.Ifthissolutionwillbesupportedbylegacydataandlegacyapplicationfunctionality,thesolutionwillbeinterfacedwithlegacyapplicationthroughSOAadaptorsandwebservices.ThedatawillbemovedacrossanEnterpriseServiceBus.This,ofcourse,assumesthatalllayersareinplace.But,asdiscussedearlierinthechapter,itisverypossibletousespecialpurpose‐toolsortoolsthatapplytoonlyoneortwolayersinthemodel.

Currently,themajorBPMStoolsoperateonlocalcompany‐basedhardwareservers.However,mostvendorsarenowmovingtooffertheirproductsthroughaformofnetwork“cloud”‐basedservices.Theseofferadifferentarchitectureandadifferentformofbilling—usuallyonatransactionbasis.Itseemsclearthatagreatervarietyofarchitecture/useofferingswillbeavailabletocompaniesusingBPMStools.Whilethevarietyisdifficulttopredict,securitywilllikelyremainaproblem,aswilldataintegrity.Formanycompanies,theseissuesmaylimitoptions,asuseanddatamayneedtoremainlockedbehindthecorporatefirewalls.

Althoughsimilarinmanyways,inrealityeachvendor’stoolsuitemodulesandfunctionalitywillvary.Somearenarrowlyfocusedandsomeprovidemodulesthatperformawiderangeoffunctions.Inaddition,somevendorshave“integrated”toolsfromothervendorsintotheirproductofferingandresellthesemodulesaspartofacompletetoolsuite.Becauseofacquisitions,theplayingfieldamongthesevendorsisconstantlychanging,withmajorcompanieslikeIBMandOracleaugmentingandchangingtheirofferingsbypurchasinghigher‐endBPMvendors.

Thistendencycreatesatemporaryinstabilityinthemarketasvendorsadjusttheirofferingsanddecidewhattheywillkeep,modify,andeliminate.Whilethisshouldeventuallycreatebetterproducts,intheinterim,itdoesincreasetheriskofanycommitmenttoaspecificvendor.

Somevendorswillalsorequirethepersonusingtheirtoolstobemuchmoretechnical.Open‐sourceBPMSareanexampleofthisandrequireagreatdealofJavacodingtodrivetheproductsbehindthescenes.Othermainstreamproducts,suchasPega,alsofallintothis“technical”category.So,“userfriendliness”canbeamajorconcernandcouldbeconsideredmoreimportantthanaBPMS’sfunctionalityorcost.

AlthoughthepastfocusinBPMonusingaBPMSforspecificproblem‐resolutioneffortshascausedmanycompaniestopurchasemultipleBPMSs,anymorestrategicuseofBPMStechnologywilllikelymandatethatthecompanymovetoasinglevendororaleastalimitednumberofBPMSvendors.Acompanylookingatavendorconsolidationormovingtocentralizeonasinglevendorshouldconsider,inadditiontofunctionalityandusability,severalfactors.Theseinclude:

Thevendor’splansforthemodulesintheirproduct.Willanyproductsbereplacedorsunsetinthenextthreeyears?Ifyoumakeacommitmentto

Copyright A

BPM


382

theirproduct,howwilltheyhelpyoumigratetothenewversion?Thisisaproblemtodaywithsomevendorsastheycontinuallymovetonewproductsandversions.

Isthevendorforsale?Whatwillbeguaranteedifthevendorissold?Youwillwanttobeassuredthatsomeproductswillnotsimplybedroppedbythenewowner.Manyvendorshavebeenpurchasedinthepastthreeyears.Thistrendwillcontinue.Howwillitimpactyou?

Alliancestability:arevendorsstrategicallyandlegallycommittedtocontinuesupportinganyintegrationofproducts?Ifavendorallianceisdropped,whatwillbedonetoassureyourcontinueduseofthefullproductsuiteandhowwillthevendorsworktocontinueyoursupport?

ThenextsectiondescribesthemainBPMtechnologies.Theyare:

BusinessProcessAnalysisTools(BPA) EnterpriseArchitectureTools(EA) BusinessRulesManagementSystems(BRMS) BusinessProcessManagementSuite(BPMS) BusinessActivityMonitoring(BAM) ServiceOrientedArchitecturewithEnterpriseApplicationIntegration

(SOA/EAI) BPMEnterpriseRepository(externaltotheBPMtoolalternativesbut

needed)

Note:WhileEnterpriseArchitecturetoolsareusuallynotconsideredaBPMtechnology,theyareneededtohelpevaluatethecurrentITenvironment’sabilitytosupportanewbusinessoperatingdesign.

ThefollowingdiscussionlooksatthemajormodulesorcomponentsofBPMtools.Thisdiscussionisnotmeanttolookatallpossiblecomponentsanditdoesnotattempttocomplywiththenamingconventionofanyvendor.ThetablebelowshowsthemainBPMsupporttoolsandsomeoftheirmainuses.

BPMToolAlternatives

CoreUseCases BPA EA BRMS BPMS BAM SOA/EAIBPMRepository

ProcessAnalysis(cost,time,others)

Yes Yes Yes

ComprehensiveProcessModeling

Yes Yes

formost

BusinessProcessArchitectureDesign

Yes Yes

Simulation Yes Yes

DataManagement Yes Yes Yes

Copyright A

BPM


383

Application,Hardware,InformationArchitectureDesign

Yes

Application,Hardware,InformationArchitectureMonitoring/Management

Yes

Designandstorebusinessrules

Yes Yes

Executebusinessrules Yes Yes

ApplicationInterfacing Yes Yes

ApplicationGeneration Yes

ProcessExecution Yes

ProcessMeasurement Yes Yes

Table28.BPMToolAlternatives

10.3.1 Business Process Analysis (BPA)

Process and Workflow Modelers

Modelingtools(BPAtools)allowbusinessmanagersandstafftoenterdiagrammaticanddetailinformationabouttheiroperationsandtheproblems,volumes,opportunities,etc.associatedwiththeactivity.Tocontroltheuseofthesetoolsitiscriticalthatacompanystandardizesymboluse,modelingapproaches,andterminology.FormanycompaniesthathavemultipleBPAtools,thiswillbedifficult:notonlywillitbecostly,butitwillbeapolitically‐charged,high‐riskactivity.

Modelingtoolstypicallyallowthepersonenteringthemodeltodefinetheactivityinthebusinessbyclickingonagiventypeofsymbolanddragginganddroppingitontothemodelpage.Theplacementofsymbolscanusuallybechangedeasilybyclickinganddraggingthesymboltowhereyouwouldliketoputit.Thisistrueforallthedifferentsymbolsthatcanbeselectedfromthesymbollist.Eachsymbolismadeuniquebythelabelyougiveitandtheinformationthatisenteredtosupportitonadetaildata‐formthatcanbereachedbyclickingonthesymbolonceitisplaced.Flowisdefinedbytheuseofvarioustypesofconnectors.Someconnectorscanhaveinformationonwhatispassingassociatedwiththeuseofthesymbol.DecomposingasymbolhappensindifferentwaysindifferentBPAtools,butmostcansupportit.

TheinformationthatcanbecollectedbyBPMmodelingtoolsissomewhatstandard,butitwillvarybytooldependingonthesupportedmodelingmethodologies.Insometools,themodelerscansupportalimitedamountof“companyspecific”oruser‐definedinformationcollectionandretention.Inothers,theuserwillbelimitedtothedatathatcanbecollectedthroughattributesassociatedwithagivensymbolusedinbuildingthegraphicalmodelofthebusinessoperation.Thisisimportant,inthatitwillalloworlimitflexibilityinacompany’ssymbol‐useanddata‐capture

Copyright A

BPM


384

standards.Itisthisstandardizationthatallowsmodel,object,service,informationcapture,etc.reusewithinthecompany.

Totheextentsupportedbythevendor,thedefinitionofthesedatafieldsshouldbereviewedduringthetool’ssetupandthedefinitionoftheunderlyingdatamodelandschemasthatwillbeassociatedwiththetool’sdatabase,models,anddata‐selectionmenu(fordragginganddroppingdataelementsinmodels).

ProcessModelers’featuresinclude:

Theabilitytoidentifyanddefineactivitiesorworksteps;thiscanbethroughswimlanesorthroughafreeformatdiagrammingtechnique

Hierarchicallyassociatethelevelsofdetail Showwhererulesapply—decisions,etc. Associatenotesorotherinformationwiththeactivity Enterdetailsabouteachsymbol’svolume,datause,screens,etc. Awaytolinktheactivitiesintoatypeofflowshowingtheplacementofeach

activityrelativetotheotheractivitiesthatneedtobeperformed Buildprocessesandworkflows Decomposeanyactivityintolowerlevelsofdetail Awaytoshowactivitybyuserrole(swimlanes;eachswimlaneisdefinable

byroleordepartment) Theabilitytocapturesupportinginformationabouteachactivity Volumes Valueranges Timing

Andmore:

Acontexttocapturerulesthatcontroltheoperation,andinterfacetoarulesengine

Identifyandassociateruleswithactivity Determineruleredundancyetc. Buildindataqualityrequirements Acontexttoidentifyandassociatereportingandauditingactivity SixSigmatoolapplication Datacollectionpoints Workqualitychecks Aframeworktoassociatetheuseofapplicationsystemsandtheuseofdata Definethedatathatcanbeenteredforsymboldefinitionandbackground Definethedataoneachapplicationscreen Definetheeditsandotherqualitychecksfornewapplications Definethewaydatawillbeusedthroughrules Theabilitytodesignscreensthatwillbeusedatanypointusingforms Iterativelydesignscreenswiththepeoplewhowillusethem Alignscreenstodataandrules Changescreensanddataquickly

Copyright A

BPM


385

Theabilitytolinktoabusinesssimulationmodule(someBPAtoolscannotsupportsimulation)

Simulatetheuseofchangesandtheirimpact Createmultiplemodelstoseewhatchangesworkbest Abilitytosupporttesting Anabilitytotrackperformanceinformationcaptureintothemodels— Trackperformanceforeachindividual Trackperformanceattheprocessorworkflowlevels Collaborationsoftwareincludingelectroniccommunicationtools,

conferencingtoolsandmanagementtools. Multipleconcurrentusers Multiplelocations Teamuseofinformation

Note:ThesetoolsoftentakeadvantageoftheInternetandprovideweb‐basedapplicationsthataresupportedbywebbrowsers.

10.3.2 Enterprise Architecture (EA)

Business workflow, Data Flow, Data use, Applications tied to workflow

EnterpriseArchitectureisamodelofthebusinessoperationthatdefinesthestructureoftheorganizationandhowitcanachieveitscurrentbusinessrequirementsanditsfuturegoals.ThebasicviewpointofEAisfairlytechnical.Itincludesanapplicationviewpoint,adataviewpoint,andaninfrastructureviewpoint.Theseperspectivesarecenteredonabusinessviewthatservestotietheotherstobusinessorganization.

Thisareaofworkischangingtoday.Inthepast,EnterpriseArchitecturewasreallyanITtechnologyarchitectureforthebusiness.Thiswasamodelofallthehardwareanditssupportingtechnicalsoftware:operatingsystems,middleware,andtools.Itincludedapplications—especiallywhenERPsorotherlargesystems(integratedgroupsofvendorapplicationmodules,suchasHealthInformationSystems)areused.TheEnterpriseArchitect’sfocusisonusingtechnologytosolvebusinessproblems.Tomany,thisisinterpretedasmodelingtheentirebusinessanditsITsupportandthenapplyingITtosolveallbusinessproblems.

AlthoughthisdisciplinestillreflectsitstechnicalrootsinthecapabilitiesofEAtools,itsscopeandfocusareexpandingtoincludebusinessconcerns.InEAmodeling,themodelswilluseatypeofprocessmodelasthecentralmodel.Thisisusuallyahigher‐levellookthaninBPMSorBPAtools.Thesemodelsusuallyfollowoneoftwobasicapproachestobusinessdefinition—TOGAFortheZachmanFramework.

TheEnterpriseArchitectisconcernedwiththestructureoftheorganization.Thisoftenincludesbusinessstrategy,process,businessandITinfrastructure,organization,andculture.Inmodeling,theEAmodelsmayincludethesecomponentsandexternalcomponentsthataffectthebusiness.

Copyright A

BPM


386

WhiletheEAcoremodelsincludeprocessmodels,EAtoolsoftenhaveatechnicalviewthatislackinginaBPMS.Thisallowsthemtolookatthewayapplicationstietoactivityandhowtheapplicationsthenlinktooneanotherandhowdataflowsbetweentheseapplications.

Note:InEnterpriseArchitecture(EA)tools,atechnologyperspectiveisaddedtothebusinessview.

EAtools,however,havelimitationsinotherbusinessmodelingareas,butwillatsomepointlikelycompetewithtraditionalBPMStools.Generally,theEAtoolsareusedforadifferentpurposethanBPMSsandarenotgoodatrapiditerationbecausetheyusuallylacksimulationcapabilitiesorgoodwaystodecomposeprocessorworkflowdiagramstolowerlevelsofdetail.However,theiruseinrelatinghardwareandsoftwaretobusinessactivitiesformsaverydifferentandusefulpictureoftheenterpriseandITsupport.MostofthemoreadvancedEAtoolsofferagreatdealoffunctionalityinrequirementsdefinitionandmanagementwithanabilitytotrackrequirementsthroughthesystemsdevelopmentlifecycle,generateapplicationsinoneormorelanguages,reverseengineerlegacyapplications,databasemodeling,applicationdebugging,andmore.Collaborativeprocessingisalsosupportedinmostofthetools,withsecurityoveraccessandchange.

AlthoughmanyEAtoolsuseBPMNtodefinesymboluse,thetoolsgenerallyhaveadifficulttimeinterfacingwithaBPMS.ThiscanbeaproblembecauseitmeansthatEAandBPMmodelswillrequiretwodifferenttoolsuites,andthatthemodelsmayeasilygetoutofsync.

AsEAbecomesmoreattunedtothebusinessoperationandlessIToriented,itwillcrossboundarieswithBusinessArchitectureandProcessArchitecture.Thiswilllikelycauseconfusionoverrolesandresponsibilitiesthatmaybereflectedintools.However,todaythereisstilladistinctionbetweenthemorephysicalviewofEAandthemoreconceptualfocusofBusinessArchitectsonBusinessandTechnicalCapabilitiesastheyrelatetostrategy.Butbotheventuallyconsiderprocess,whichistherealmoftheProcessArchitect.So,wecanexpectconsiderableoverlapandshakeoutasthesedisciplinessortouttheirboundaries.

10.3.3 Rules Engines or Business Rules Management Systems (BRMS)

Business Rules Definition, Rules Storage, Rules Access by Applications

Businessandtechnicalrulesdefinehowworkwillbeperformedineachactivityorstepinaworkflowor,atahigherlevel,aprocess.Theyarethe“institutionalknowledge”ofthecompanyandtheyaretherealcompetitivedifferentiatorofthecompany.Theydefinewhowilldosomething,whattheywilldo,whentheywilldoit,whytheywilldoit,howtheywilldoit,andhowitwillbecontrolled.Fromatechnicalperspective,rulesarethelogicofthebusiness.

RulesEnginesaretoolsthatsupporttheidentification,definition,rationalizationandqualityofbusinessandtechnologyrules.RulesEnginesalsoprovidearepositorythatallowsrulestobecheckedagainstoneanotherfordefinitionor

Copyright A

BPM


387

contextproblems,andthuschecksforredundancyanddefinitionquality.Theseenginestodaytendtobefairlytechnicalinnature,sothedefinitionofrulesintheseproductstendstorequirebothtrainingandexperienceintechnologyandinbusiness.

Inpractice,rulesarelookedatas“if—then”statements:“if”(aneventorvalue),“then”dosomething.Becausethelistofthingsthatmustbeconsideredinanydecisioncanbefairlylongandcomplex,ruledefinitioncanbeaseriousundertaking.

Rulestendtofallintooneofseveralcategories.Theseinclude

Businessoperationrules Decisionrules Flowsequencingrules ProceduralandPolicyrules Datause/securityrules Accesssecurityrules Monitoringandreportingrules Technicalrulesassociatedwithdatacalls,datatransformation,application

interfaces,etc. Legalrules Financialrules Monitoringandmeasurementrules Regulatoryrules.

Whilethislistofcategoriesisfairlyrepresentative,itmustbecustomizedtoeachcompanyandusedtocreatetheinternalarchitectureofarulesrepository.ThisandotherdefinitionfunctionsallowthesetupoftheRulesEnginetoworkatanoptimallevelinyourcompany.ThisdefinitionisnottrivialandshouldbecarefullyconsideredpriortotheimplementationofaRulesEnginetomaximizeitsuseandcompanybenefit.

Rulesdefinitionandcodingiscriticaltothewayageneratedapplicationwillexecute.Iftherulesaretoocomplex,theexecutionwillbeslow.Iftheyarelongandtestforalonglistofconditions,theywillbeslow.Iftheycallmultipledatabases,theycanbeslow.Iftoomanyslowrulesareplacedinarow,theexecutionoftheapplicationwillbeslow.Forthesereasons,thecodinganduseofrulesshouldbecarefullycheckedandstandardscustomizedfromalistofbestpracticesprovidedbythevendor.

Thebiggestprobleminmostcompaniesisthatbusinessrulesarenotwelldefinedororganizedincurrentproceduralmanuals.Fewcompaniesreallyunderstandtheiroperatingrulesorhavethemformalized—especiallylow‐levelbusinessexecutionanddecisionrules.Inmostcompanies,rulessimplydonotworkthewaymanythinktheydo.Thatisbecausepeopleattheexecutionlevelmustfindwaystogettheirjobsdoneandtheyinterpretandchangerulesconstantly.

Rulesarevirtuallyeverywhereincompanies.Insomecasestheycanbefoundinproceduralmanualsorinpolicymanuals.Inothercasestheyareinmemos,notes,

Copyright A

BPM


388

emails,andjust“folklore.”Theyarealsoembeddedinlegacyapplicationsandintheimplementationoflicensedorpurchasedsoftware.Theyareeverywhereinthebusiness,buttheyarealmostneverinoneplace.

ThishasseriousimplicationsfortheselectionanduseofaRulesEngine.ItisalsoareasonthatmanyrulesprojectsaredrivenfromIT,wheretheyareneededtodefinehowapplicationswillwork.Regardlessofwhoorwhatisdrivingthemovetoidentify,define,andrationalizerules,thetechnologymustbeabletoacceptentriesfrommultiplebusinessunitsandmergetherulestocreatecommondefinitions,versions,synonyms,antonyms,etc.,asitbringsrulesintoacommonrepositoryandensurestheirquality.Thisusehasimplicationsforaccess,security,andchangeabilities.So,itisimportantthataRulesEnginebeabletoconformtotherealitiesofthewayyouneedtouseitinyourcompany.

ItmustbenotedthatthedefinitionofaruleforentryintoaRulesEngineforstorageanduseinaRulesRepositoryisnotasimpleactivity.Rulesarecomplex,andtheirdefinitionsneedtobecompletebeforeentry.Theyseldomstandaloneandmustbedefinedincompletesetsofdecisionsandorganizedinawellthought‐outstructurethatsupportsthewaytheywillbeexecutedbyanoperationorprogram.

ThismustbeconsideredinthesetupoftheRulesEngineandtheRulesRepository.Followingthissetup,therulesmustbetranslatedintoatypeofcomputerprogramcodeforentry.ThebetterRulesEngineswilldoavarietyofcomplicatedsyntax,relationship,andothertestingastheruleisentered,butitisimportantthattherulebedefinedcorrectlyandchecked,becauseitwillbeusedtogenerateBPMapplicationsandtorunthebusiness.

CommonRulesRepositoryuseincludes

Thecaptureofanorganization’sinstitutionalknowledgeinacentralplaceo Thedefinitionofruletemplatesforspecificcustomerinteractions,

suchasactioncompliance,cross‐sell,up‐sell,andmore—including Scorecard—basedonscoringandranking DecisionTree—basedonif‐thenlogic DecisionMap—basedononeortwoexplicitinputvalues DecisionTable—basedonaseriesoftestconditionstobe

evaluatedo Thecreation,alignment,testinganddeploymentofruleso Rulestorageforcompanywideaccess

Findingcurrentlydefinedrulesandtheirdefinitions:o Directflowlogicandexecutionstepsinbusinessmodelingo UseinBPMSapplicationsgenerationo Designlegacyapplicationmodificationo Determinelegacyapplicationinterfacingdesignandneeds

Supportingruleexecutionbyprogramsandmanagingruleuseo Eliminationofruleconflictsandredundancyo Identificationofrulesthatnolongermeetlegalrequirementso Improverulequality—clarity,consistency,andediting

Copyright A

BPM


389

TheanalysisofServiceLevelAgreements,KeyPerformanceIndicators,SixSigmaformulae,andmore

Managementofthequalityandintegrityoftherulesandrulesetso Managechangestoruleso Managethecreationofnewruleso Provideapictureofeverywheretheruleisusedtodeterminehowit

shouldchangeo Testruleuseo Manageaccesstorules

Buildingwhat‐ifanalyticstoanalyzeinter‐relatedrulesandruleuseo Historicalandruntimeanalyticso DeployrulestotargetprogramsandBPMuse

Validationthattherightdataisbeingusedbytherules Datause,editing,testing,andlegacydatause.

BenefitsthatcanbeexpectedfromaRulesEngineinclude

Externalizationofrulesinastandardformat,usingastandardvocabulary Placeallrulesinasinglecentralrulesrepository Expediteprogramchangesbyhavingallrulesandtheirusescross‐

referencedinasingleplace Flexibleruledefinition—legacyapplications,interviews,documents Improveruledefinitionquality—providesconsistencyinrulereuse Ruledefinitionandtestingsupport—redundancy,“holes,”logic,etc. Versioncontrol Improvedrulevisibility Abilitytoevolveapplicationsandbusinessoperationsfasterbydealingwith

externalrules Makeachangeinoneplaceandhaveitappliedeverywheretheruleisused.

10.3.4 Business Process Management Suites (BPMS)

Process Modeling, Workflow Modeling, Rules Definition, Business Operation Simulation, Application Generation, Business Operation Environment, Management Reporting

ABPMSisasuiteoftoolsthatformajointIT/Businessoperatingenvironment.HerethebusinessrunswithintheBPMSenvironment.Bythiswemeanthatwhenapersonstartstheirworkandlogsintoanapplicationsystem,theyareloggingintothe“runtime”partoftheBPMS.This“runtime”partiswherethemodelsandrulesareexecuted.

InaBPMSthebusinessprocessmodelsarebuiltofBPMNsymbols.Thesesymbolsrepresenttasks,decisions,automatedactions,etc.,andeachisuniqueinthatitrepresentsatypeofsmall,single‐purposecomputerprogrammodule.Theseprogrammodulesarearrangedandrun(executed)intheorderdefinedbytheflowinthebusinessprocessmodels.TheprogramcodeofthesemoduleshasblankspacesthatareautomaticallyfilledinbytheBPMSwiththerulesthatthebusinessmodelsassociatewiththesymbol’suseandthedatathatthemodelstellthesystem

Copyright A

BPM


390

touse.ScreensaredefinedasformsandassociatedwithtaskswithintheBPMS.Reportsarealsodefined.

Exitsfromthebusinessprocessmodelstolegacyapplicationsorotherprogramscanbeputintothebusinessprocessmodelstocallotherapplicationsandformaseriesofautomatedtasks.Althoughatypeofinterfaceisstillneeded,ServiceOrientedArchitecture(SOA)‐usewithEnterpriseApplicationIntegration(EAI)adaptorsandacceleratorsmakeinterfacinginthisenvironmentmucheasierandthusreducetimeandrisk.

Specialmanagementcontrolscanalsobeaddedtothemodelstocontrolworkflowvolume,workrouting,delayalert,etc.Theseshouldbestandards‐based,buttheBPMScansupportalmostanycompanystandards.

Rulesareenteredincodedformandtherules‐enginepartoftheBPMSkeepstrackofeveryplacetheruleisused.Changestoanyrulearemadeintherulesengineandthencalledbyallthebusinessworkflowmodelsastheyareexecuted.Thisgreatlysimplifieschanges.

Performancemeasurementcanalsobeaddedtotheworkflowmodelsandspecificmeasurementsarecreatedthroughrulesorexitstoothermeasurementprograms.ThisiswhereperformancedisciplinessuchasSixSigma,LeanandBAM(BusinessActivityMonitoring)areused,byembeddingtheirperformance‐monitoringapproachesorprogramsintothenewdesigns.Theresultscanbeusedtofeedcomplexdashboardsandprovidewarningswithrecommendedactions—againbasedonrules.ManyBPMStoolsalsoallowyoutodefineformsthatcanbeaccessedfromasymboltocapturescreenandreport‐relatedinformation.Thetoolsthatcangenerateapplicationsallowthedesignertocreatemodelsofdata‐captureandlookupscreens,aswellasreports.Themoresophisticatedtoolsalsoallowyoutolinklegacyapplications(atthefunctionanddatalevel)tothesymbol’suseinthebusinessflow.Ofcourse,thetoolsthatcangenerateBPMapplicationsallowyoutolinkrulesdirectlytotheactivitysymbolsforBPMapplicationgeneration.

Thisenvironmentiseasyandquicktochange.Mostchangesaremodel‐basedorrulesredefinitionsoradditions.Tohelpensurethecompletenessofthechange,andreduceriskoferrorordata‐qualityharm,anychangecanbequicklysimulatedusingthesimulationcapabilityinmostBPMS.Thisallowstheteamtoiteratequicklyuntilanoptimalsolutionisready.Implementationisreallyamatterofasoftwareswitchandanyretrainingneeded.

10.3.4.1 BPMS setup

AllofthemajorBPMStoolsprovideasignificantamountofdiagramminganddefinitionflexibility.Thisisbothastrengthandaweakness.Becausemodelscanbebuiltusinganyoftheavailablesymbols,theuseofthesymbolsmustbestandardizedforthemodelstobereadable.ThisistrueevenusingatoolthathasbeenbuilttofollowtheBPMNstandardset.

ItisalsoimportantthatintheBPMStoolssetupyouconsiderthesymbolsetsthatwillbeusedandwhetherspecialsymbolsareneeded.Thisuse‐designwilllikely

Copyright A

BPM


391

needtofollowtheBusinessProcessModelingNotationstandards(BPMN),sincemostBPMStoolsfollowthisstandard.However,asnotedearlier,insomeBPMStoolsthereisminorflexibilityindefiningsymbolsanddata‐capturescreens.

Note:BPMNisasetofgraphicalstandardsthatspecifythesymbolsetsthatwillbeusedinBPMdiagrams/models.Assuch,theydefinethesymbolsthatwillbeusedindepictingprocessandworkflowinbusinessmodeling.TheBPMNstandardswereoriginallyformedbytheBusinessProcessManagementInitiative(BPMI)andarenowmaintainedbytheObjectManagementGroup.Inadditiontosymbolstandardization,BPMNattemptstostandardizeterminologyandmodelingtechnique.

Mostprocessmodelersofferadrag‐and‐dropformofusethatallowsausertoselectasymbolorconnectorfromamenuandthendropitwhereheorshewantsit.Ifswimlanesareused,thecontextofthesetupmustfirstbedefined.

Note:Swim‐lanemodelsdivideascreenorpageintomultipleparallellinesorlanes.Eachoftheselanesisdefinedasaspecificdepartmentorbyarolethatapersonplaysinperformingthework.Theworkmovesfromactivitytoactivity,followingthepathoftheflowfrombusinessunittobusinessunitorfromroletorole.Thewaythesemodelsaresetupforeachprojectmustbecontrolledbycorporatestandardsifthelong‐termvisionistobuildanintegratedcorporatebusinessmodel.Thesestandardsshouldgovernwhenandhowtheswimlanesaredefined(businessunitorrole),howtheactivitiesaredecomposed,whatdataiscollectedinthemodeling,andmore.

Thesameistruefortheinformationthatiscaptured.ItmustbedefinedandstandardizedintheBPMSforconsistentuse.Settingthesestandardsandcontrollingtheiruseshouldbetheobjectiveofacompany’sBPMCenterofExcellence,oracompanyBusinessTransformationgroup.Ifthesedonotexistinthecompany,across‐functionalteamofmembersfromthebusiness,IT,BusinessArchitecture,DataManagementandBPMshouldbeformed.Ifthisisrequired,itisimportanttomakecertainthatallgroupsarerepresentedandthatallagreetofollowthestandardsandrulesthatarecreated.Withoutthisinput,thestandardswillbeimposedwithoutbroadacceptanceoranunderstandingoftheirpurposeorvalueandtheywillnotbewellacceptedorused.

ThissectiontalksaboutthemajorcomponentsofaBPMSandformsacompositepictureofthemoreimportantcapabilitiesofthisenvironment.Itshouldalsobenoted,thatalthougheachvendorapproachesthisinadifferentway,alltoolsuitesprovidebasicallythesamecapabilitiesandfunctioninmuchthesameway.

10.3.4.2 Application Generation

Mostlegacyapplicationsareorientedtosupportingwork.Theyareusedtohandlerepetitivetasksagainstlargenumbersoftransactions.

Today,BPMallowsyoutonotonlyconsidertransactionapplications,butalsoworkmanagementapplications—applicationsthatcontroltheflowofworkandhowthatworkisdoneorshouldbedone.Thisincludesworkloadassignment,workloadtracking,workloadbalancing,workloadaging,erroridentification,performancemanagement,reportingandmore.

Copyright A

BPM


392

Applicationgenerationinvolvestheuseofbusinessmodelstoprovidecontextanddirectiontotheworkflow,andrulestoidentifythedatathatwillbeusedandtheactionthatwillbetaken.FormsthataredefinedintheBPMStoolsgeneratethescreensthatareused.ThisisaformofObjectOrientedProgramming,inwhichdifferentobjectsaredefinedbyacombinationofactivityandrules,andtheexecutionsequenceisdefinedbytheplacementoftheactivityinrelationtootheractivitiesintheworkflow.Becausetheapplicationscanbegeneratedeverytimetheyareused,anychangetotheworkflowmodels,therules,ortheformswillbeimmediatelyincludedintheapplication.

Applicationgenerationcreatesadifferenttypeofapplicationthanthosecreatedinthepastusingtraditionalcomputerlanguages.Theseapplicationsaremadeofsmallindependentmodulesthatexecutewhencalled.Eachactivityintheprocessmapcanhaveanynumberofassociatedrules.Theprocessmap’sactivitiesprovidecontext,sequencing,andrelationship.Theassociatedbusinessandtechnologyrulesprovidethecommands—call,perform,etc.Eachactivityessentiallycallstherules,andatalowerlevelofdetail,therulescancallotherrulesanddata.ControloverthehumaninteractionisdefinedinformsthattelltheBPMShowtobuildscreensandthen,usingassociatedrules,tellthesuitewhattodowiththedata.

Thedevelopmentofuser‐friendlyBPMSformsiscriticaltotheacceptanceofthenewbusinessdesignbytheusers.TheseformsdefineUserInterfaces(oftenreferredtoasGraphicalUserInterfacesorGUIs)andrepresentafairlytime‐consumingandcost‐relevantelementofanyBPMSimplementationproject.Thisisthepartoftheoverallredesignthattheuserwillseeandworkwithdaily.Itiscriticalthatthisdesignbelaidoutwiththeuserandmodifiedthroughsimulationoriterationtoprovideoptimaleaseofuse.Itisalsoimportantinthisdesigntogetdataelementdefinitionsrightandtofindtheacceptedsourceforeachdataelementoneachscreenorform.Businesslogicanddatause/editrulesarealsoassociatedwitheachdataelementandeachform.Thesecomponents,whenviewedtogether,representthewaythesystemwillbeusedanddeterminewhetheritwillbe“userfriendly.”

Thefinishedapplicationisreallyaseriesofreusablemodulesthatcalldataordosomethingwithit.Thesemodulesarelikepearlsonanecklace.Theycanbestrungtogetherinaninfinitevariety,whereeachdoesonethingandthenpassestheresultstoanothermoduleforthenextstep.Becausethemodules(activitylevelorlowerstepsandrules)areindependent,theycanbeusedinavarietyofapplications.

ThisapplicationgenerationisthemajorbreakthroughinBPMS.Thisisthetool,whenusedwithamodelerandarulesengine,whichprovidesspeedofchange.ApplicationgenerationallowsITandbusinesstochangethewaytheyapproachautomatedsupport.Throughthistool,businessandITwilleventuallybecomemergedforapplicationdevelopment,maintenance,andenhancement.ProcessModelsandRulesModels,togetherwiththedefinitionofscreenandotherformsintheBPMS,providethespecificationsneededtogenerateapplications.TheprogrammodulesandthewaytheyareexecutedbytheBPMSallowatotallydifferentapproachtobusinessandtoIT.Inthenot‐too‐distantfuture,legacyandpurchased

Copyright A

BPM


393

applicationswillbecomeanachronismsastheyarereplacedbygeneratedapplicationsmadeofBPMSmodules.Whilethisisstillafuturepossibility,itisnotsciencefictionanditiscomingsoon.Asthisnears,theabilitytochangewillbecomeacorecompetencyincompanies,andthosewhomovetoadoptthisnewmodelwillhaveasignificantcompetitiveadvantageoverthosewhoarelateadopters.

Today,manyofthebetterBPMStoolssupportveryflexibleandrapidapplicationgenerationandmodification.Theyalsosupporthightransaction‐volumeactivityandcomplexlogic.Usingexternaldatabasetools,theBPMS‐generatedapplicationscanalsosupporthigh‐volumedatauseandstorage.Becauseofthisflexibility,someapplicationvendorshavebeguntouseaBPMSengineintheirsoftwareproducts.AnexampleofthisisthehealthcarepackagecalledSoarianbySiemens,whichisbuiltusingtheTIBCOBPMS.

10.3.4.3 Supporting Groupware and Collaboration

WhilemostvendorsexcelatprovidingsomeofthefunctionalityshowninFigure67,manyareeitherweakinsomeareasordonotprovideafullsuiteoftools.Ascanbeexpected,duetocompetitionagrowingnumberofvendorsarenowreachingfairlyhighlevelsofsupportacrossallareasoffunctionality.

Thisfunctionality,forthemostpart,worksandactuallyperformswellforallthemajorvendors.AkeyfeatureofthemajorBPMSsistheabilitytosupportlargenumbersofconcurrentdevelopersandusersandtohandmodelsbackandforthbetweenpeopleorteams.Thisabilityallowsthetoolstobereferredtoas“groupware.”ItisthisabilitythatletsBPMS‐supportedapplicationsbemodeledinonelocation(byoneormoreteams),constructedbyBPMSDevelopersandDataArchitectsinasecondorthirdlocation,andthenusedinmultiplelocations.Thisabilityalsoallowsdistributedteamstoworkwiththesamesetsofmodelsandthesameinformation.Ofcourse,governanceinthisopenenvironmentbecomescritical,butthekeyisthatallpartiesmustbegovernedbythesamesetofstandardsandthateachgroup’sworkbeperiodicallyauditedforcomplianceandquality.Inthisway,theteamscanworktogethertoevolvedesignsoradddetail.Whenthishappens,theBPMenvironment’sdatarepositoriescaneasilybegintoevolveintotrueenterprisemanagementrepositories.Becauseofthisgroupwarecapability,agreatdealofthetechnicalsideofusingaBPMStobuildapplicationshasbeenmovedoffshoreinsupportofanapproachcalledtheGlobalDeliveryModel.

Thisopensthebusinessenvironmenttorealcollaborationbetweeninternalgroupsandwithpartners,asitsupportstheuseofthetoolsbypeopleindifferentlocations.

10.3.4.4 Rapid Evolution

Atpresent,itissuggestedthatthetoolsfromthefollowingvendorsbereviewedasastartingpointinanylookatfunctionality.ThislistispartialandismeantonlyasastartinlookingatfullBPMSs.Althoughtheseproductsareconsideredtobeamongtheleaderstoday,thislistwillchangeastheleadersleapfrogoneanotherandnewcompaniesreleasehighqualitytools.

IBM/Lombardi SoftwareAG

Copyright A

BPM


394

Global360 Oracle Pega Savvion(ProgressSoftware) TIBCO

Note:Thevendorsareplacedonthislistalphabetically.Placementdoesnotindicatequality,completenessorpreference.ItisrecommendedthattheForresterWaveortheGartnerMagicQuadrantBPMSratingreportsbeusedtoidentifytheleadingvendorsatthetimeyouareinterestedinevaluatingBPMStools.

TheresultofthisleapfroggingoneanotherisarapidevolutionintheBPMStoolsandtheadventofasetoftoolsthatcanhandlelargetransactionvolumes,largedatabases,andcomplexlogic.However,becausethemaintoolsuitesdovaryincapability,itissuggestedthatanyconsiderationofmovingtoaBPMStoolorconsolidatingBPMStoolstoasingleenterprise‐wideBPMS,beginbydefiningthebusinessandtechnicalcapabilitiesthatarerequired,andthengoonemajorstepfurthertodefinethewaythetoolwillbeused,andbywhom.Thisaddsan“easeofuse”dimensiontoanytoolevaluationorselection.ExcellentplacestobeginthisresearcharegroupslikeGartner,Inc.,ForresterResearch,andIBMResearch.OthergoodplacestolookforinformationaretheBusinessProcessManagementInstitute’swebsite(BPMI),theABPMPwebsite,andtheBruceSilver.comblog.Inaddition,socialnetworkingsiteslikeLinkedInofferaccesstodifferentBPMgroupsandthusaccesstoavarietyofexperiencesandideas.However,informationfromsocialnetworkingsourcesmustbeconsideredtobesuspectbecauseanyonecanclaimtobeanexpert.

10.3.5 Business Activity Monitoring (BAM)

Performance Monitoring, Performance Measurement, Performance Reporting

TheobjectiveofBAMistoprovideacomprehensivelookatthebusinessoperationastheoperationisperformingitstasks.Thisallowsmanagementtotakecorrectiveactionasproblemsareoccurringandhelpsoptimizetheperformanceofthebusiness.

AlthoughusuallyincludedintheBPMStoolsuite,BusinessActivityMonitoringisnotsupportedequallybyalltheBPMS.MostBPMStoolshaveabasiclevelofBAMbuiltintothem.However,thisisabasiclevelandadvancedreportingissupportedbyonlyafewBPMSs;mostvendorsrelyonexternaltoolsthatarefedbytheBPMSasitsapplicationsareexecutedduringbusinessuse.

Generally,BAMisconsideredreal‐time,onlinemonitoringandmeasurementofactivitythatwillfeedvariousperformancereviewprograms.DataisaggregatedandcomparedagainstKPIsandotherstandardstodeterminequalityandperformworkmanagement,suchasworkloadbalancingwithcaseassignmentorshifting.SixSigmaperformanceapplicationscanbeusedin‐streamtomonitorworkflowagainstpresetevaluationlimitsandfeedbackintotheBAMfornear‐real‐timereporting.

Copyright A

BPM


395

Anexceptiontothisreal‐timeuseistheadditionofperformance(completionetc.)informationfromtheexecutionoflegacyapplicationsandapplicationexecutiondata.HeretheinformationfromtheBPMSandotherperformancemonitorsarecollectedandaddedtoinformationfromlegacyapplicationexecutionandexternalsourcestoformthedatausedinabroaderanalysisofthebusinessoperation’sstatus.ThisinformationcanbefedtodatabasesoutsidetheBPMSforusebyavarietyofBusinessIntelligencetools.

10.3.6 Enterprise Application Integration (EAI)

Communication Templates, Accelerators, Adaptors used to access legacy application data

EnterpriseApplicationIntegration(EAI)helpsimplementtheSOAprotocolandvision.Itissupportedbytoolsthatenablethecreationof“adaptors”betweenthecommunicationmedium(ESBorothercommunicationsplatform)andtheapplicationsthemselves,aswellasbetweenapplications.Anapplicationmayhaveoneormoreadaptors,dependingonthewaydataaretobeobtainedandused.Theseadaptorscontrolthetranslationofdatafromtoandfromtheformatusedinagivenapplication,anditsflowtoandfromthecommunicationsplatform.

Inpractice,anapplication’sdataisopenedorexposedtoaccessbyacalltotheprogramovertheadaptor.TheadaptortakestheinformationfromthetargetapplicationsandputsitintoanSOA‐basedformatforgeneralizedconsumptionbyotherapplicationsthathaveadaptorstocontrolthetranslationofdatatoandfromtheapplication.Thisgreatlydecreasesthenumberofinterfacesbetweenapplicationsandbetweenprogramswithinapplications.Italsodecreasesthecomplexityofinterfacingapplicationsandreducesriskandcost.Again,however,dataintegrityisakeyissuethatmustbeaddressed.

TheprocessofbuildingEAIadaptorstolegacyapplicationsiscalledWrapping.Theseadaptorsarecustom‐builttodeliverorobtaininformationfromapplicationsortoaccesscertainpartsoftheapplication’sfunctionality.

10.3.7 SOA

ThispartoftheSOAdiscussionprovidesamoretechnicalview.ThisdiscussionhasbeenprovidedbyMichaelFuller,aformerManagingPrincipalwhoiscurrentlyanindependentconsultant.

10.3.7.1 What is SOA?

ServiceOrientedArchitecture(SOA)isaflexiblesetofdesignprinciplesusedinapplicationsystemsdevelopmentandintegration.TheapplicationsarewrittenasindividualservicesthatfollowSOA‐formattedcallstodatainlegacyorotherapplications.ThesecallsarepassedtoEnterpriseApplicationIntegration(EAI)adaptorsandtranslatedtocallsorupdate(puts)inmoretraditionalprogramminglanguagesthatoperatewithintheapplications’technicalenvironment.ThisallowsdatacallsandputstobebuiltfollowingasingleSOAformatandthendelivered(oftenusinganEnterpriseServiceBusorESB)toanapplicationinawaythatitcan

Copyright A

BPM


396

easilyacceptwithouttheneedforcomplexinterfacing.However,thisisstillnotasimpleprocess,andalthoughSOA,EAI,andESB‐usedoessimplifytheneedtoget,move,deliverandformatdata,itstillremainsacomplextask.

Thisprovidesalooselyintegratedgroupofprogrammodulesthatcanbeusedonanas‐calledbasis.Inadditiontocreatingthistypeofobject/servicelibrary,SOAprovidesaformatandfoundationtonotifyconsumersoftheseservicesoftheiravailability.

10.3.7.2 How Does SOA work? A background.

SOAisanapproachforlinkingresourcestoobtainorpresentdata“ondemand.”WithintheServiceOrientedArchitecture(SOA)paradigm,therearetwofundamentalandindependentresources:InterfaceandImplementation.

ThefollowingdefinitionsareimportanttothediscussionofaServiceOrientedArchitecture.Becauseoftheirnature,thedefinitionscontaintechnicalreferencesthatthebusiness‐orientedBPMprofessionalmayneedindiscussionswiththeITSOAarchitects.

Interface:Thesoftwarethatcallsdatafrom,orpresentsdatato,oneormoreapplicationsthatareexternaltotheapplicationbeingexecuted.Theinterfaceaddressinformationforlocatingtheassociatedimplementation(s)iscalledtherequest.

Therequestisthecommandthatbeginstheexecutionoftheinterfaceandcallsdatafrom,orinputsdatato,adatabasethroughthesystembeingaccessed.Oncethedatacallisexecuted,thedataispresentedtothe“interface”programwiththecontentoftheWSDL(seebelow)usedto“direct”therequesttotheprogramthatisinvokingtheserviceorinterface.Thisprogramiscalledthe“implementation.”

Implementation:Aprogramtoinvokeaservice,butdoesnotcontain“businesslogic.”

WSDL:TheWebServicesDescriptionLanguage(WSDL)isastandardwayfordefiningaserviceinterface.

ThebasicelementsofWSDLare:

Interfaceinformationdescribingallpubliclyavailableservices(functions) Datatypeinformationforallmessagerequestsandmessageresponses Bindinginformationaboutthetransportprotocoltobeused(e.g.tcp/ip,http,

jms,etc.Asingleservicecanbesupportedovermultipletransportprotocols).

Copyright A

BPM


397

Service:aserviceisaspecificexecutableorprogramthatisdefinedbythesetoffunctionsitsupports.Servicesareindependentprogrammodulesthatcanbecalledbyotherprogramsorservicesandexecutedtoprovideaspecificactionorproduct—function.

10.3.7.3 SOA Principles

SOAisadataaccessanddeliverystrategypursuedbytheenterprise—itisnotsimplyatacticortechniquethattheenterpriseadoptstopursueagoalofimprovedapplicationinterfacing.Thedistinctioniscritical.Becauseofthescopeofchangeandtheimpact,amovetoSOAshouldbecloselyassociatedwiththestrategicgoals,objectives,andbenefitssoughtbytheEnterpriseArchitecture.

Today,thereisnosingleconsensusonwhatthetermSOAentailsorhowtodistinguishbetweenan“SOASolution”anda“Non‐SOASolution.”SOAcanbeviewedwithintheframeworkofacceptedprinciplesthatcanbeappliedtoevaluatetheuseofanapproachthatdeliversSOA’sprinciples.AlthoughthereisdebateonwhatSOAentails,aspartofdefiningacceptedprinciplesthereisgeneralconsensusonthebenefitsofSOA:“flexibility,”“agility,”“scalability,”“reuse,”etc.Inadditiontothesesignificantbenefits,SOAmandatesprovideabenefitthathasbeenelusive—thedeconstructionofthebarriersthattypicallyexistbetweenthe“business”and“I/T”;betweendifferent“businessunits”;andbetweendifferent“I/Tspecialties.”

TohelpcontroltheuseofSOA,theindustryhasacceptedalargenumberofinternationalstandardsthatmostvendors,consultants,andthemediaassociatewithSOA.Themainstandardisthe“ExtensibleMarkupLanguage”(XML)publishedbytheWorldWideWebConsortium(W3C).XMLisastandardfordefininga“vocabulary”thatdescribesinformationbeingmovedamongsystems.XMLallowsprogrammerstodescribethe“syntax”oftheinformation,butnotthe“structure”or“semantics”oftheinformation.TheXMLSchemastandard,alsopublishedbytheW3C,providesthe“vocabulary”fordescribingthe“structure”and“semantics”oftheXMLdocument.

Note:theterm“XMLdocument”referstoanythingthatisencodedusinganXMLvocabulary:abusinessletter;apurchaseorder;amessageexchangedbetweenparties;aschemadescribingadatabase;etc.

Overall,therearemorethan30additionalstandardspublishedbytheW3C,OASIS(OrganizationfortheAdvancementofStructuredInformationStandards),theISO(InternationalStandardsOrganization),theOMG(ObjectManagementGroup),andothersthatarecloselyassociatedwithSOA.AmongthesearetheWebServicesDescriptionLanguage(WSDL),WS‐Policy,WS‐Security,WS‐ReliableMessaging,BusinessProcessExecutionLanguage(BPEL),BusinessProcessModelingNotation(BPMN),JavaScriptObjectNotation(JSON)andmanyothers.

Copyright A

BPM


398

ThestandardsusedbyaparticularenterpriseincreatingtheirSOAsolutions,andinparticularwhatportionsofthecompletestandardareused,determinehowSOAwillbeusedandwhichofthemanySOAbenefitsaparticularenterpriseisemphasizing.SOAisthusnotaone‐size‐fits‐allforcompanyITenvironmentsorbusinessusestrategies.

ToimplementSOAitisthusnecessarytodefineitsgoals,use,andinternalstandards.IncreatinganSOAstrategy,itisimportanttoidentifythebenefitsthatareneededandthenadoptthestandards,methods,techniquesandconceptsneededtodeliverthesebenefits.ItisalsonecessarytomakecertainthatITandthebusinesshaveaclearroadmapforhowanSOAstrategywillbeimplementedandwhatrolethepeopleinvolvedwillplay.But,evenwithaclearvision,astrategyandaplan,themanagementoftheimplementationwillrequirefundingandconstantoversighttoensurethatthenewapproachisbeingfollowedtherightway.

SOArequiresthatacompanyconsiderandexplicitlydocumentwhat“resourceswillbelinkedondemand”—forexample,processes,messages,dataentities/views,datastores,rules,events,etc.

Italsorequiresthecompanytoconsiderandexplicitlydocument

Whetherthe“resourceslinkedondemand”arealwaysinternaltotheorganizationormayinvolvetheirbusinesspartnersandcustomers

Howchangeswillbecontrolled WorkinmigratingtheirsoftwareenvironmenttoanSOAformat TheabilityoftheirtechnologyplatformtosupportSOAchanges Newdatastoragerequirements.

SOAbyitsverydefinition—“Asystemforlinkingresourcesondemand”—requiresthatcompaniesunderstandhowitcanbeusedsotheycanmanagethecostsandrisksinherentinthisapproach.Becauseofitsflexibilityandthewayitopensdataaccess,itiscriticalthatacomprehensiveandeffectivegovernanceregimebeimplemented.ThelackofcomprehensiveandeffectivegovernanceisthemostcommonlycitedreasonforthefailureofSOAinitiatives.

AmajorgovernancechallengeforSOAismanagingthelifecycleofservicesfromconceptionthroughspecification,development,testing,deployment,dailyoperations,andfinallyretirementoftheservice.Thisincludescontrollingchangestotheways

Organizationalunitscollaborate Decisionrightsandresponsibilitiesarehandled Processischanged Proceduresarevetted Methodsandtechniquesareused.

TherearecurrentlyagreatmanysoftwareproductsthatarecloselyassociatedwithSOA,includingServiceRegistry,ServiceRepository,EnterpriseServiceBus,ComplexEventProcessing,BusinessProcessManagementSystem,etc.CompaniesofallsizeshavesucceededintheireffortstorealizethebenefitsofSOA.Butmanycompanies

Copyright A

BPM


399

havealsofailed.Theseproductscanprovideastandardplatformtobuildanenterprise’sSOAsolutions,butunlesstheenterprisehassystematicallyinstitutionalizedtherequisitestrategy,methods,standards,governanceregime,techniques,andstaffdevelopmentprograms,theproductswillsimplynotdelivertheexpectedbenefits.ItisthereforeimportantthatthesebeputinplaceassoonaspossibleinanyorganizationthatisseriouslylookingatmovingtoSOA,expandingalimitedusedofSOA,orhavingtroubleimplementingSOA.

10.3.7.4 Moving to SOA

ThefollowingmustbeconsideredwhenmovingtoSOAarchitecture:

Vision,strategicplanning,executiveacceptanceandbudgetassignmentalongwithexpectationmanagement

Businessperformanceevaluationstrategy—value,line‐of‐sightfromStrategicgoalsthroughrun‐timeperformanceofaservice,orcompositeapplicationtechniquesforrealizingboththebenefitsofSOA

SOAreadinessassessment—currenttechnicalenvironmentandarchitecture DefinitionofSOAstrategy—includingusedefinitionandimplementation

roadmap DefinitionSOAarchitecture—thatconsidersthingssuchas,operatingwithor

withoutan“enterpriseservicebus,”staticvs.dynamicinstantiationofservices,staticvs.dynamicbindingofservicepolicies,enforcementofSLAs/QoS,realizationofoperabilitygoalssuchasavailability,reliability,fault‐tolerance,etc.,anduseofarepository/registrytosupporttheservicelife‐cycle)

Governance—fulllifecycleincludingSOAPrulesandhowtheywillbeused(seeSOAPbelow)

Identificationofinitialservicestobeusedinprototypingandtherequirementsoftheprototype—includingresultsreportingandanalysis

Definitionofservicetypesthatwillbebuilt BuildanSOAcapability—TrainingandProficiencyTesting,toolselectionand

implementation Howtodevelop,test(coding/codedebugging),andimplementSOA

access/interfaces/EAIadaptors,etc. Howtodefine,design,buildandimplementanESB—includinganyredesign

ofcurrentcommunications.

Note:Whiletheseactivitiesarekeyconsiderations,thisisnotacomprehensivelist.

10.3.7.5 SOA and SOAP

EmbeddedwithintheSOAumbrellaisasetofstandardsthatgoverndatatransfer.Thesestandards,namedSimpleObjectAccessProtocol(SOAP),areasetofrulesfortransferringstructuredinformationacrossanetworkintheimplementationofWebServices.SOAPmessagesrelyontheuseofExtensibleMarkupLanguage(XML)asamessageformat.

SOAPrulescanbeorganizedintothreegroups:

Copyright A

BPM


400

1. Amessagepacket—definingamessageformatandhowitistobeprocessed2. CodingrulesfordefiningSOAprogrammingalongwithdataformatand

content3. Standardsdefiningprogramprocedurecallsandresponses.

Followingtheserules,programmersbuildcodemodulesthatoperateasindividualsmallprograms.Eachperformsanactionandthenpassestheresult.Bycallingthemodulesthatyouneedfromamoduleorservicelibrary,theprogrammerhasflexibilityintheuseoftheservicesandtheabilitytoreusethemeitherastheyareorwithmodification.Thisallowsprogramstobeconstructedfromcommonpartsandreducestheprogrammingtimeandrisk.

SOAPcharacteristicsinclude:

AprotocolfordefiningandbuildingprogramstoallowandgoverncommunicationbetweenapplicationsovertheWeboroveraninternalESB

Note:Asaprotocol,SOAPisplatformandcomputerlanguageindependent.

Anabilitytodealwithinternetcommunication AdherestoWorldWideWebConsortium(W3C)standards Supportoftext,voice,email.

10.3.7.6 Using SOA

Todefinethewaytointegratedifferentlegacyand/ornewapplicationsforusebymultipleseparatebusinessunitsorapplications,SOAdefinesinterfacesintermsofprotocolsandfunctionality.Thisallowstheinterfacingtobestandardizedandallowssystemstosharedatawithothersthatfollowthesameprotocols.Thisreducesthepoint‐to‐pointinterfacingbetweenapplicationsusedinthepastandsimplifiesthewayapplicationscansharedata.Thisalso,however,increasesthecriticalityofdataintegrityforthedatainuse.

Byusingstandardizedservices(programcodemodulesorobjects)andstandardizedinterfacing,SOAoffersnewwaystobuildserviceorientedapplicationsthatareexternaltoBPMS‐generatedandlegacyapplications.However,theapplicationsgeneratedinintheBPMS‐supportedBPMenvironmentfollowastandardizedformatandareconceptuallysimilartoSOA‐orientedprogramcodemodules—theyperformonefunction,theyarestandardized,andtheyarereusableprogramobjects.

ApplicationsfollowingaSOAapproachandusedtosupportBPMmayinclude

Workflowexecution—leverageSOAconceptstocreateprogramsandobtaindataneededtoperformactivities

EAIservices—adaptorssupportingSOAcommunicationsapproaches BusinessIntelligence—operationalstatistics,auditetc. Rulesmanagement—descriptionandexecutioncapabilities Processoperation—actionorworkmonitoringandcontrol Performancemanagement—obtaindatafromtherealtimeBPMapplications

andfromlegacyandotherapplicationsfollowingSOAprotocols.

Copyright A

BPM


401

10.3.8 Enterprise Service Bus (ESB)

AnEnterpriseServiceBusisasoftwarearchitecture,setofsoftwaretools,software,andacommunicationmediumorcarrier.TogethertheseESBcomponentscontrolthemovementofdatabetweencomputers.ApplicationsinanESB‐supportedITarchitecturecancommunicatebytyingintothecommunicationscarrier(network)partoftheESB,whichservesasamessagebrokerbetweenthevariousapplicationsinthecompanythatusetheESB.EachcomputerontheESBisaseparatenodeonthenetwork.Eachhasaseparateuniqueaddressonthenetwork.TheapplicationsusingtheESBwilldefinetheplacesornodesthatwillreceivethemessageorrequestandthenassigntherightaddressoraddressestothemessage.Allnodesonthenetworkconstantlymonitororlistentothetrafficonthenetwork,waitingforamessagewiththeiraddress.Whenheard,thenodeacceptsthemessageandsendsitthroughtheEAIadaptortotheapplication.Theadaptorconvertstheformatofthemessagesoitcanbeacceptedbytheapplication.Thereverseistrueformessagesbeingsentbyanapplication.

TheESBsoftwaretoolsthussitbetweentheapplicationsandworkwiththeEnterpriseApplicationInterface(EAI)software,allowinglegacyoranyotherapplicationstocommunicateovertheESBinastandardformat.

WhenusedwithanSOAopen‐messagingapproach,informationcanbebroadcastoverthenetworkforallapplicationsontheESBtohearanduse.ThesemessageswillbeinacommonSOAformsotheycanbeeasilyconsumedbytheEAIadaptor.Inthisway,informationcanbeeasilysenttoseveralapplicationsatonetime,withoutaneedtobuildseparateinterfaceprogramsbetweeneachoftheapplications.Thiseliminatestheneedformuchofthepoint‐to‐pointorapplication‐to‐applicationcommunicationconnections(interfaces)thatexisttoday.

Thissimplificationofinterfacesandthereductioninthenumberofinterfacesbetweenapplicationsreducestheriskofchange,costofchange,andthetimeittakesforachangetoanapplication.

EnterpriseServiceBusesnormallyworkwellwithBPMSsandare,infact,partofsomeBPMSssuchastheIBMWebSphereandTIBCOsuites.

10.3.9 External BPM Enterprise Transaction Data Repository

BPMSrepositorieshavetheabilitytostoreamajorityoftheinformationonthecompany’soperation.Theydonot,however,usuallystoreallthevaluedatathatiscollectedfromtransactionsthatareprocessedthroughtheBPMS‐supportedbusinessoperation.Becauseofthevolumeofthisinformation,thesetransactionvaluesareoftenexternallystoredusingDBMtools.ThekeyindeterminingwhatisstoredwithintheBPMSrepositoryandwhatisstoredexternallyisoftenuse‐based.Forexample,theinformationneededtodrivethebusinessoperation,suchastaskassignment,workrouting,andscreencontentisgenerallystoredinthetoolsuitedatabase.However,inanyBPMSorBPMtoolimplementation,theinternalDataBaseManagementgroupshouldbeinvolveddeterminingwhatwillbestoredwhere,

Copyright A

BPM


402

creatingthedataschemasthatwillbeused,anddeterminingapplications/databasesthatwillserviceas“sourcesofrecord”forgivendata.

ProcessrepositorycontentcanincludethefollowingforProcessandworkflowmodels.

Note:Processiscrossorganizationalandcrossfunctionalinnature.Workflowisatanorganizationorfunctionlevelandlooksattheactivitythatisperformedintheorganizationtoproduceaproductorsubcomponent.

Whoownstheprocess Whattheprocessdoes Whatactivitiesaretakingplaceandtheirlinkstooneanother Whattechnologyenablersandcontrolsareused Whattriggersoreventsinitiatetheprocess Whataretheexpectedresults Whatproblemsareassociatedwitheachactivity Whenistheprocessinitiated Wheretheprocesstakeplace Howtheprocessinteractsorlinkstootherprocesses Howtheprocessinteractswiththoseofotherbusinessunitsorexternal

enterprises Volumesandtiming Howtheresultsaredelivered Whyit’sneeded,howtheprocessalignstostrategicgoals ServiceLevelAgreements,KPIs,goals,etc. Processmetricssuchastimetoperform,numberofresourcesrequired,

minimumandmaximumconcurrentexecutions,directandindirectcost,etc. BusinessRules Typeandsourceofdatarelatedtotheprocess Regulatoryrequirements Timing,natureandformsofpossibleoutput Outputsthatbecomeatriggerforanotherprocess.

Thislistwill,ofcourse,varybyvendor,butthehigher‐endvendorswillhavemuchofthiscapability.Thekey,however,istomakecertainthattheuseofthetoolsuiteisdefinedforbothtodayandtomorrowwhenlookingataBPMSorBPMtool.Thisisnecessarytoprovidetheflexibilityyouneedwithouthavingtocompletelystartoverormovetoamoreflexibletoolsuiteasyourneedschange.Partofdefiningwhatthetoolsuitemustprovideisthedefinitionofwhatinformationyoubelievewillbeneededtocontroltheevolutionoftheoperation,theabilitytodealwithlegacyapplications,andtheflexibilityyouwillneedtokeeppacewiththechangingbusinessworld.

Becausetherepositorycansupportcollaborativebusinesssolutiondevelopment,people’sabilitytoaccessitfrommultipleconcurrentlocationsprovidesanaccessproblem.Controllingaccessthusbecomesanissuethatmustbeaddressed.While

Copyright A

BPM


403

thisisreallynotaconcernformostpastusesofBPMSsforspecificproblemresolutionsolutions,itbecomescriticalinabroaderuseofthesetoolstocreateoperatingenvironments.Forthisreason,itisimportantforyourDataBaseArchitectsandDataBaseAdministratorstoplayaroleintheselectionoftherighttoolsuiteforyourneedsandforthewaythattheBPMSEnterpriseRepositorywillbesetup.

10.4 Making BPM technologies work for you

Successinanymovetonewtechnologydependsuponanabilitytounderstandthetruecapabilitiesanduseofthetool,andanabilitytoworkcloselywiththevendoryouhavechosen.Thislatterneedmay,however,requireanegotiatedrelationshipwithKPIsimbeddedinthelicensecontract.Inaddition,itisimportanttoconsiderhowthetoolandBPMwillbeusedandtocreateadesignorarchitectureofthewaythetoolwillfitintoyourcompany’sbusinessoperationandITenvironment.Itisalsoimportanttoconsiderhowdatawillbemanagedandhowthetoolwillbeusedtosupportcollaborationwithinthecompanyandwithpartners.

Note:Thisisnotanall‐inclusiveorexhaustivediscussion.ItsimplycoverssomeofmoreimportantconsiderationsthatshouldbehighlightedinanyBPMSorBPMtoolstrategy.

10.4.1 BPM Infrastructure Architecture

Anarchitectureissimplyadesign.ABPMarchitectureisadesignofhowthevariouscomponentpartsofaBPMenvironmentfittogether.Today,thereareagreatmanyofthesearchitecturesavailableforaBPMS‐supportedBPMenvironment.Aswithmostthings,somearebetterthanothersandsomewillmorecloselyfityourcompanyandhowitthinksBPMandaBPMSshouldworkwithinitsoperation.BPMisoftenstartedwithoutanytooluseinmind:itevolvesandatoolisselectedtomeetbusinessneeds.Thisisnormalanditisfine,butthetoolselection(basedonthevisionforhowthetoolwillfitintothecompany,howitwillchangethewaybusinessisapproachedandthewayinformationisdelivered)hasadefiniteimpactonITandthebusiness.Thisimpactcanbedescribedinadesignorarchitectureofthefutureoperatingenvironment.Thisisimportantbecauseitisaguideforhowthenewbusiness/ITenvironmentwillworkandwhoisresponsibleforwhat.

Copyright A

BPM


404

Figure69.BasicBPMTechnologyArchitecture(Source:ReferenceArchitectureforaBPMInfrastructure;

RichardWatson,ResearchDirector,Gartner)

WhenallthecomponentBPMSmodulesandconceptsareputtogether,themodellookssomethingliketheoneabove.

Inthisarchitecture,theBPMEnterpriseRepositoryholdsallthemodels,rules,andassociatedinformationaboutthecompany’soperation.ThisinformationiscollectedduringthebusinessanalysisandmodifiedinthebusinessredesignusingtheBPMS.Oncethenewdesignisapprovedandthenewbusinessoperationandapplicationsaredeployed,thisinformationisusedbytheBPMStosupporttheexecutionofthebusiness’stasks.InaBPMS‐supportedBPMenvironment,thisusuallyhappensthroughtheuseoftheapplicationsgeneratedbytheBPMS.Theseapplicationsandthebusinessoperationleveragelinkstodata,usingApplicationProgramInterfacesintheEAIproductstocreatelegacyapplicationadaptors.CallsfordatawillthengoeitherovertheESBordirectlytothesourcedatabase.Ofcourse,thesecuritythatisagreeduponintheITGovernanceorPolicycommitteewillcontrolaccesstothisdata.ThecallsfordatawillthengothroughtheEAIadaptorthatcontrolsaccesstotheapplicationordatabase.ThiscreatesSOA‐baseddatapacketsthatarethensenttotheESBfordelivery.

Copyright A

BPM


405

ModernBPMSSystemarchitecturestypicallyimplementtwodifferentlayers,apresentationlayer(usuallyimplementedinformofawebserverwithsuitabletaskservices)andaprocesslayer,wheretheprocessengineexecutesprocessmodels.Thiswillincludewebservicesthatneedtobedefinedorbuilt(programmed)and,withintheBPMS,thecallstoexecuteexternalcodemodules.

AlthoughmostBPMSshavefairlyconsistentarchitecturalcomponents,eachissomewhatuniqueinthewayitfunctions,thewayitinteractswithrules,thenumberoftemplatesitprovidestodefinewebservices(andmore),andthewayitaccessesandusesdatabases.ItisthusimportanttodefinethearchitecturethatwillbeusedbytheBPMSyoulicenseandthewayitwillbeusedinyourITenvironment.

10.4.2 Business and Data Requirements Definition

Asalways,thebusinessrequirementsthataredefinedinthebusinesscasecreatedforproject‐fundingapprovalwillserveastheguideinsettingprojectgoalsandindefiningtheproject’sscope.Smallerprojectsthatdonothavebusinesscaseswillstillhaveasetofgoalsthatcanserveasrequirements.Theseproject‐levelrequirementswillcontinuetobeusedasthebasisfordeterminingprojectestimates,schedules,andcompletion‐measurementsteps,sorealbenefitcanbecalculatedandcomparedtoestimate.

Asmentionedabove,thetraditionalapproachtodefiningapplicationsandbusinessrequirementsbeginswiththecreationofseparatebusinessandtechnicalchangerequirementsfromanewconceptualdesignofthebusiness.Theconceptualdesignwillitselfreflecttheprojectchangerequirements.InaBPMS‐supportedBPMoperatingenvironment,thedeliveryoftheserequirementscanbetestedinsimulation.Inatraditionalapproach,thesystemandactualbusinessoperationchange‐requirementsdefinitionbeginswithidentificationofthedifferencesbetweentheoldandnewbusinessmodel.Itthenreliesonbusinessandtechnicalpeopletoconverttheserequirementsintosystemspecifications(specs)soprogramscanbebuilt,testplanscreated,andtrainingprogramswritten.

WiththeuseofaBPMS,thistraditionalapproachisbecomingananachronism.IntheBPMSenvironment,thenewbusinessdesign,alongwiththerulesdefinitionandforms(screens)designs,becomesthenewoperationandsystemsrequirementsandspecs.BPMSapplicationsaregeneratedfromthesemodels,makingthemodelsandtherequirementsdefinitionthesamething.

Thedeltafromtheoldversionofthebusinessoperation(the“AsIs”models)tothenewdesign(“ToBe”models)definesthechangeandprovidesthespecsforthepartsofthechangethatarenotaddressedintheBPMS‐generatedapplications.ThesespecsfocusoutsidetheBPMSenvironmenttolookataneedfordataacquisition,movement,anddelivery,withlegacyfunctionalityuse,webservicesrequirements,anddatabasedesignrequirements.

IntheBPMSoperatingenvironment,theBPMSandenterpriseBPMSrepositoryprovidetheinformationandtoolstomodelthebusinessandthenquicklydefineanddesignchanges.Thesechangescanberunthroughthesimulationenginesinmany

Copyright A

BPM


406

ofthehigher‐endtoolsuites,andtheresultscomparedandanalyzed,toquicklycreatenewiterationsthatconstantlyimprovethebusinessoperation.Thenewdesignfromthisiterativeimprovementprocessbecomesthenewbaseline.Thentheprocessofchangingthebusinessoperationanditsapplicationssupportstartsagain,inanever‐endingcycleofimprovement.

10.4.3 Team Collaboration

InaBPMS‐supportedBPMenvironmentthebusinessdesignsthusbecometherequirementsandtherulesbecomethelogicthatdefinestherequirements.ThisforcesanewtypeofcollaborationbetweenITandthebusiness,redefiningtherolesthateachgroupplaysintheongoingevolutionoftheoperationanditsapplications.Fortunately,thegroupwarecapabilitiesoftheBPMSsallowmultiplepeoplefromanylocationorlocationstoworktogetheronthesamebusinessmodels.Thiscreatesavirtualteamofpeoplefrommultiplelocations:theexpertscanbeinanypartofthebusinessandstillbeinvolvedinthecreation,modification,andapprovalofthenewbusinessdesigns.Thisalsoallowsthemtobeinvolvedinthedefinitionandapprovaloftherules,thewayperformancewillbemeasured,andthewaytheoperationwillchangeandimprove.

Ofcoursestandards,control,andgovernancedirecthowthisisdone,buteveryoneontheteamwillalwaysbelookingatthesamemodelswiththesameinformation.Thisisacriticalimprovementoverthetraditionalbusinessandapplicationsdesignapproaches.UsingaBPMS’scollaborativecapabilities,anyoneandeveryonewhowillbeimpactedcannoweasilyhavearoleindetermininghowthebusinessoperationwillwork.Thiscreatesaverydifferentdynamic.Withthisability,itisnoweconomicallypossibletoensurethatanychangeisdonewiththepeoplewhowillbeaffectedandnotjusttothem.

Thepresentationofthebusinessinformationisalsomucheasiertoabsorbandcomprehendthanthetraditionallistsandtextapproach.Today,modelsandsupportingdatacanbequicklyreferencedatavarietyoflevelsofdetail,andanyaudienceorgroupcandealwiththelevelofdetailthattheyneed—withtheabilitytomovetomoredetailiftheyneedto.Thisgreatlyimprovesthewillingnessofpeopletobecomeinvolvedandsignificantlyreducesthetime‐requirementformostpeopleontheprocess‐improvementorproblem‐resolutionproject.

Thesecapabilities,however,requiredifferentconsiderationofissuesthatmaybenewtomanypeopleinthecompanies.Thepoliticschange,theneedforinclusionchanges,theapplicationsthataresupportingthebusinessmaybedifferent,localizedregulationswillneedtobeconsidered.Ifyouwillneedinternationalaccessbyteamsindifferentcountries,youwillneed24/7accessandyouwillneedtoidentifyandunderstandthelawsineachofthecountriesyouaredealingwith.However,ifthecompanyintendstoofferitsproductsindifferentmarkets,theseissueswillneedtobeaddressedanyway.TheBPMStoolssimplyallowthisinformationtobecollectedandthenprovidedatanytimeitisneeded.BPMSthusbecomesanenablerforthebusinesstoexpanditsbrands.

Copyright A

BPM


407

10.4.4 Underutilized Capabilities

ThekeyprobleminthepasthasbeentheapproachtousingBPMSs.ABPMShasseldombeenconsideredasanoperatingenvironmentandithasseldombeenconsideredasanarchitecture.MostorganizationshaveusedBPMSstohelpsolvespecificproblems,andtheuseofthesetoolshasbeenlimited.ThereareusuallynooverallBPMSuseguidelinesandseldomanenterpriseBPMSpolicy.

ThisisbecauseBPMSshavebeenviewedastools,andtheirpotentialhasbeenundersoldbythevendors,whosimplywantquicksales.Whenusedtherightway,however,theBPMSshavedeliveredsignificantresults.Thesuitesaremuchmorethanmostenvisionthemtobe.Theyprovideanewwayofdeliveringautomatedsupportandofapproachingbusinessevolution.Whenconsideredinthebroadercontext(notsimplyasaproblem‐specificsolutionenabler)theyhavethepotentialtodeliverunexpectedresultsinthedeliveryofacontinuousimprovementcapability,theenvironmentneededtodeliverameaningfulSixSigmaprogram,andtheabilitytooptimizeabusinessoperation.

ThisbroadervisionoftheuseofthesetoolsprovidesaverydifferentframeworkforlookingatBPMSsandwhatacompanyexpectsfromitsinvestment.Unfortunately,fewofthevendorstodayofferthisvision,andthediscussiononwhataBPMScanreallydoisjustbeginning.However,theabilityofthebettertoolsuitestosupportthisoperatingvisionisavailableandthediscussionsonhowBPMcanreallyhelpabusinessimprovearehappeninginorganizationslikeABPMP.

10.4.5 Decision Support and Performance Management

AmongthegenerallyunderutilizedcapabilitiesinmanyBPMS‐supportedsolutionsisperformancemanagementanddecisionsupport.BPMS‐supportedoperatingenvironmentsofferavarietyofperformancemanagement(performancemonitoring,performancemeasurementandbusinessintelligence)capabilities.ThesetoolscanalsoworkwithSixSigmaandothermeasurementtoolstointegratetheirinformationintothedatamixavailableforanalysisandmanagementactivities.

Theuseofthesecapabilities,drivenbysimulationofthesolutionthatwillbebuilt,providesthefoundationforactuallymeasuringimprovementrelatedtothenewsolution.ThiswillallowrealROIdetermination.Today,businesscasesareusedtohelpjustifytheneedforaprojectoraction.Butthereisseldomareasonablewaytoactuallymeasureimprovement.OnceabusinessoperationisbeingsupportedinaBPMSenvironment,thistypeofmeasurementisfairlystraightforwardandallowsthebusinessandITtodetermineactualimprovement,insteadofjustestimatedimprovement.ThisabilityisakeypartofthedeliveryofcontinuousimprovementbyBPMStechnologyenvironments.

Intheseenvironments,theBPMSwillsupporttheredesignofthebusinessandapplicationcomponentsneededtomakeachange,andthenpredicttheimprovementthroughthesimulationmodule.Thiscanthenbeimplementedandtheactualimprovementmeasuredagainstthepredictedimprovement.Thisthenhelpsguidefurtherimprovement,whichfollowsthesameprocess.Whenlookedat

Copyright A

BPM


408

overanytimeperiod,itisthuspossibletoseetheKPIsandotherperformancenumbersatthestartofthetimeperiodandthenattheendofit.Thisisawaytomeasureactualimprovement,anditcanbeappliedatanylevelinthebusinessoperation.

Forexample,ifyouimplementaworkflowinaBPMenvironment,youwillbeabletodeterminehowanyserviceinaServiceLevelAgreement(SLA)ismeasured.ThesameistrueofaKeyPerformanceIndicator(KPI).ImplementingthesemeasurementscanbeeasilyaccomplishedwithintheBPMStechnologyenvironmentor,usingmoretraditionalmeans,outsidetheBPMenvironment.Bytakingperiodicreadings,youcanlookattrendsanddetermineimprovement.Atanytime,itisthereforepossibletodetermineimprovementoveragivenperiod.Bytakingtheseupdatesfollowingprojects,itispossibletoseethebenefitoftheproject.

Inaddition,BPMtechnologyenvironmentssupportwork‐in‐progressmonitoringtohelpbalanceandmanageworkloadonanytimebasis—weekly,daily,hourly,etc.Thisissupportedbyreal‐timemonitoringanddashboardreporting.Variouslimitscanbesetasrulesandassociatedwithactivityoranylevelofworkintheoperation.Therulesthendrivethemonitoringandmeasurement.Thisallowsreal‐timeinterventionbymanagementtokeeptheworkflowingatanoptimalrate.

Byaddingstandardsandrulesthatlookforpatternsinthedata,itispossibletomovethislevelofanalysisandreportingtotheBusinessIntelligencelevel.Thisispredictivemodelingandreporting.Baseonthewaythevaluesarebuildinginthevariouscomponentsthatarebeingmonitored,itisalsopossibletocreaterulesthatrecommendaction.Whilethesetypesofreportingrequirecreativityandanin‐depthunderstandingofthedataandtheprocesses,theycanbesupportedbythebetterBPMSs.

10.4.6 Buy‐in and Monitoring

Creatingasoundperformance‐monitoringcapabilityrequiresthebuy‐infromallwhowilluseit.Whileobtainingthisbuy‐inisnotatechnologyconcern,itisrelatedtothetechnology’sabilitytosupportmonitoringandthecollaborationneededtoobtainfeedbackandbuildconsensus.Thisisimportantindeterminingthewaythebusinessreallyworks.Whilethesingle‐purposemodelingtools,rulesengines,etc.donotsupportperformancemonitoringverywell,theBPMStechnologyofthefullproductsuitesdosupportthisthroughtheircollaborationandmeasurementcapabilities.

Usingthesetoolsmakesitpossibleforallinvolvedtoseehowperformancewillbemonitored,measured,andreported.Itisalsopossibleforeveryonetoseehowtherulesthatdrivethismonitoringwillcalculateandwhatdatatheywilluse.WhilethiscanbedoneoutsideaBPMSenvironment,itcanbeeasilyaccommodatedinrealtimeacrossmultiplegroupsandlocationswithinaBPMSenvironment.Thiscapabilityisnottheoretical,andcaneasilybesupportedwithinaBPMStechnicalenvironment.

Copyright A

BPM


409

10.4.7 Setup

Whilemodelersandmostother“singlepurpose”BPMtoolsareflexible,itisimportantthatconsiderableuseanalysisbedoneupfronttoavoidsetupproblems.Whilethevendorwillhavealistofconsiderationsthatyouwillneedtomakedecisionson,itisadvisabletolookinternallyatsuchconsiderationsas:“HowwillyouusetheBPMtoolortoolsuite?”and“Whatflexibilitywillyouneed?”Thislistofdecisionsshouldbeformalanditshouldbereviewedbythebusinesssponsorsandmanagers,theITinfrastructuregroup,theDataManagementgroup,andtheapplicationssupportgroup.IfyourcompanyhasaBPMCenterofExcellenceoraBusinessArchitectureCenterofExcellence,theyshouldalsoreviewthislistofsetupdecisionsforcompletenessandfortheirabilitytosupportanyanswerthatisgiventoadecisiononthelist.

Inadditiontohowthetoolwillbeused,itiscriticaltoconsiderthedatathatwillbecollectedbythetooltosupportthebusiness,thewaythedataschemaswillwork,andthewaythetoolwillinteractwithexternaldatabasesandtoolssuchasWordandExcel,legacyapplications,andpurchasedpackagessuchasanERP.

Theanswersshouldlookatbothcurrentandfutureneeds.Inthisway,thesetupwilltieintothevisionandstrategyoftheBPMSorBPMtool’suse.Thedatacapturedinthesetools’modelscanchangeeasilyandquickly,butthestructureofthetoolandmanydefinitionsthataresetupatthetimeofinstallationcannot.Toavoidlimitationsonhowyoucanusethetools,itisimportantthattheybesetupforyourusetooptimizeyourcapabilitiesandthewaythefunctionswork.Itissuggestedthatcarebeusedinapproachingimplementationissueswiththevendorandthatyouhaveaclearunderstandingofwhatyouneedthetoolsuitetodo,bothnowandinthefuture,beforeyoubeginimplementation.

Whilethissoundslikeabasicconsideration,itisoftennarrowlyfocusedandoftenfailstolookatthelong‐termuseoftheproductsorthetruebusinessneedsthatmustbeaddressed.Thisinformationshouldbereviewedindetailwiththevendor,whoshouldbeabletoprovideguidanceonhowtooptimizetheinternaltoolsetupduringeachinstallation.

10.5 BPMS Governance

Governanceisatradeoffbetweencontrolandflexibility.Themorecontrolthatisimposed,thelessflexibilityisavailabletotheusers,architects,andapplicationsdevelopmentpeople.InaBPMS‐basedenvironment,thisneedforcontrolbecomesgreaterthaninthepast.However,thestrengthofusingaBPMSisthespeedofchange—implyingminimumcontrol.So,thetwogoalsareopposedtooneanother.Whilethisisanage‐oldproblem,itnowtakesonadifferentspin.Wecannowdothingsthatwecouldneverdointhepast,withthehelpofBPMStools.Formanythings,thequestionnowmovesfrom“canwedosomething?”to“shouldwedoit?”

AnexampleisachangetoanoperationalmanagementapplicationgeneratedbyaBPMsuite.Wecannowdefinetheimprovement,modelit,simulatedifferentoptions,andthenimplementthechangeinalmostrealtime.Thiswasseldom

Copyright A

BPM


410

possibleinthepast.Buttodothis,weneedtosuspendcontrol.So,wecanmakeandimplementchangeveryfast,butshouldwe?Theanswerhereis“no,weshouldn’t.”Weneedsomeformofqualitycontrolpriortoimplementinganychange.Thatissimplyawisepolicy.Buthowdowewanttocontroltheprocess?Wecouldimposebarriersthataddweekstothealmost‐instantprocess.Thatalsoisnotwise.So,wheredowedrawtheline?Theanswerwillbedifferentfordifferentsituationsandfordifferentcompanies.Whateverthecompanydecides,thisissuemustbecarefullydebatedandtheappropriatecompromisereached.

Thisconcernisreachingnewheightsas“cloudcomputing”and“cloudapplications”areconsidered.TheInternetisawonderfultoolanditischangingtheworld.Butitisfullofdangerandmanycompanieshaveexperiencedcontinuingbreaches,dataloss,andmore.AstheissuemovesoutoftheITdepartment,itisnecessaryforthebusinessmanagersandITtoworktogethertounderstandriskandspendthefundstoimplementtherightlevelofsecurity—ineveryone’sopinion.ThevalueofopenaccesstoInternetsitesbycustomersisagame‐changingrequirementinmanybusinesses.Itcannotbeunderestimated.Buttoomuchcontrolwillimposebarriersandlimitthevalueofthischannel.Similarly,toolittlecontrolwillexposethecompanytoriskitdoesn’tneed.ThisisaconstantlychanginglinethatmustbesetwiththefullinvolvementofITandthebusinessofficersinanycompany.ThedecisionsthataremadeinthisregardwillhaveanimpactoncollaborativeteamingandonthewayBPMSsandapplicationsareapproachedandused.ThesedecisionsareimportantinlookingatbothBPMSacquisitionandsetup.Theyarealsoimportantinlookingattheneedforflexibilityandspeedinrespondingtocustomerdemandsandmarketopportunities.

10.5.1 BPM Standards and Methodologies

Today,manycompanieshavemovedintopoint‐specificBPMSsolutionswithoutstandardsoracceptedmethodologies.ThisisoftenmademorecomplexbythepoliticsassociatedwithdifferentbusinessorITgroupsgettinginvolvedwithdifferentvendorswithinthesamedepartmentorcompany.Inthesecompanies,whatmaybebestdefinedasapolitical“war”overwhoseBPMStechnologywillbecomethecompanystandardcanarise;everyonewillhavealotinvestedandnoonewillwanttoabsorbthecostordisruptionofchangingtoadifferentBPMSandthusnewapplications.Forthisreason,itisimportantforacentralBPMmanagementgrouptoformasquicklyaspossible.ThesegroupsareoftencalledCentersofExcellence.However,wrestlingwiththepoliticsofcreatingtheinitialBPMSenvironmentisachallengeandwillusuallyrequireexecutiveleadership.Evenso,itmaybedifficultformanagementtomovetoasingleBPMSoncemultipletoolssuiteshavebeenusedintheoperation.Inshortorder,therecanbetoomuchdisruptionassociatedwiththemigrationtoasinglevendor’sBPMS.Inthiscaseamulti‐vendorBPM‐toolstrategywillneedtobeformed.

Eveninmulti‐BPMS‐vendorenvironments,consistencycanbeobtainedthroughthecreationofstandardsonmodeling,ruledefinition,vocabulary,naming,etc.WhereaBPMCenterofExcellencehasbeenformed,itsmembersusuallybecomeresponsible

Copyright A

BPM


411

fordefiningandnegotiatingthesestandardsandforenforcingthem.Asaresult,theCenterofExcellencemusthavetheparticipationofkeyoperationalpeoplesothatthesestandardsmakesenseinthecontextofthecompany’sbusinessandculture.Itisequallyimportantthatthestandardsarenotaburden—iftheyare,theywillnotbefollowed.So,caremustbetakenincreatingthiscontrol.

However,itisprematuretothinkthatthereisasetofacceptedstandardsforBPMSuseintheindustryorincompanies.BPManditsBPMStechnologyisstillnewanditwillbeuptogroupsliketheABPMPtocreatestandardsindifferentareasofBPMScapabilitiesanduse.Intheinterim,itisnecessarytomoveforwardandcreatestandardsfortheuseoftoolswithinyourcompanyandthemodelingandothertechniquesyouwilluse.Thisisimportantforinformationunderstandingandforuseamongthedifferentinternalgroups.Thesestandardsshouldinclude

Theinformationthatwillbecollectedandthewayitwillbeusedtosetupthesystem

Modelsymbolset(usuallythiswillfollowBPMNstandards) Datarepository Accesssecurityandregulatoryandlegalrequirementsthatmayapply Usearchitecture:allmodelsfromdifferentprojectsshouldfittogetherto

formanenterprisepicture Standardtermsandlevels,etc. Governance.

10.5.2 Governance Models

AswithmanyaspectsofBPM,thereisnoshortageofinformationontheInternetaboutBPMgovernance.Thesediscussionsincludeuse,setup,andcontrol.Itisadvisabletoviewthemajorityofthesearticlesandapproacheswithskepticismasyouresearchthemforideas.Somearetrueandgood,butotherswillnotworkandstillothersmaybegoodideas,butnotagoodfit.

BPMMaturityisanexample.Gartner,Forrester,IBM,andothergroupshavedevelopedBPMmaturitymodelstoshowthewaycompaniesmovethroughatypeoflifecycletomaturity.Thesemodelsareoftensimilar,butcanhavesignificantdifferencesinareassuchasgovernance.SomeofthesemodelslookatonlypartsoftheBPMSandBPMgovernanceneedsandfocusontooluse;othersarebroaderandhavemoredetailedconcerns.Asnotedabove,theInternetisfullofarticlesrelatedtoBPMandBPMSgovernance,andcaremustbetakeninconsideringanypapersorarticlesfoundonblogs,consultingfirmwebsites,LinkedIn,andopenforums.Somediscussionsaregoodandotherssimplyprovetheneedforvettinginformationobtainedfromunknownsources.Itisclearlynecessarytolookatasmuchhigh‐qualityinformationaspossibleinformingyourgovernancemodel.ItisalsonecessarytocustomizeyourgovernancetoyourcompanyandthewayitwilluseBPMandaBPMStool.

WhilethegovernancemodelsandinformationyoufindcanhelpinplanninghowthecompanywillcontroltheevolutionofinitsuseofBPM,theyarenotarealguideand

Copyright A

BPM


412

shouldnotbeconsideredtobearoadmap.Theyare,however,agoodplacetofindideasandcanbeusedtohelpdefineandplanchangesincontrolasthecompanymovesfromleveltolevelintheevolutionthatisshownintheBPMmaturitymodeladoptedbythecompany.

TheprobleminsettingupagovernanceprocessisthateachcompanyisuniqueandthepathtoaBPMS‐operatingenvironmentwillbedifferentdependingonmanyfactors.ThesefactorsincludethewillingnessofthebusinessmanagersandITmanagerstoacceptcontrols,thecurrentoperationalcultureandstandardsthatareinplace,thestateoftheITenvironment,thenatureofthecompany(collaborativeorclosed,localormulti‐facility,USorinternational,etc.)andmore.Thisfactinnowaysuggeststhataformalgovernancemodelandplanarenotneeded.ItdoessuggestthatthisisaseriouspartofyourBPMSimplementationandevolution;itmustnotonlybeputinplace,butmonitoredandchangedasyourneedsarebetterunderstood.

10.5.3 Data Integrity

“Garbagein,Gospelout.”–RodMoyer,VP,BenefitAllies

Evenwheneveryoneknowsthattheinformationinasystemissuspect,theyuseitasifitwerethefinalword.Theyactuallyhavenochoice.Thisistrueinanyinternalactivityorinanyinteractionwithacustomer.Whilethecausesforpoordatavary,itisfrustratingtoeveryonedealingwithacompanyandcausesuntoldhardfeelingswithcustomers.Butitisacceptedwithincompaniesbecausedatacleanupwouldbreakthebankinmostcompanies.Therealproblemthiscausesisthatmanagementandstaffdonotknowwhototrustincustomerinteractionsorwhattheinformationisreallytellingthem.

Inaddition,datasecurityisaproblemthatisgettingworse.Notonlyisdataoftenlost,butitisoftencorrupted.DatacorruptionisthemoreseriousproblembecauseITmanagersoftendonotknowwhatiscorruptedorwhenitwasdone,sonoonecanidentifyorfixit,andrestoringittoanearlierpointwillcauseuntoldlossofnewdata.Fromthisperspective,theInternetandothertechnologyadvanceshaveactuallyhurtcompanies,aswellascustomers,withtheproblemsofvirusesandinformationtheft.InaCloudenvironment,itwillbemuchworse.Inanenvironmentwherepeoplecanaccessanythingwiththeirmobilephones,theproblemwillgooffthecharts.

Today,withthegrowingidentity‐theftproblemsandacknowledgedproblemswithapplicationinteroperability,dataredundancy,dataquality,anddatatimeliness,theproblemswithdataintegrityaregrowing.Data‐relatederrorscosttime,money,andcustomerloyalty;theycanevenleadtolegalproblems.Thereisnosilverbullethere:BPMSsupportsrapidapplicationchangetointernalandcustomer‐facingsystemsandexposesthecustomertogreaterpotentialinteractionwiththecompany.Companiesthathavedataqualityproblemswillfindthattheincreasedinteractionshineslightontheseweaknesses.

Copyright A

BPM


413

Thisisaqualityissue,onethatmanycompanieshaveignoredforyears.InmovingtoaBPMSoperatingenvironment,companieswillonceagainhaveanopportunitytoimprovethefoundation.WhileBPMStoolsandtechniquescannotfixolddataqualityproblems,theydopresentanopportunitytotightencontroloverthenewdataandcorrectdataerrorswhenfoundduringcustomerinteraction.

BecausethegeneratedapplicationsinaBPMS‐supportedBPMenvironmentaretheprimaryplaceswheredataiscollected,dataeditrulesandrulesthatcontroldatausearecritical.BothstandardsandcorrectiveactioninthisareashouldbecreatedbyacompositegroupofDataArchitects,ProcessArchitects,BusinessArchitects,ITsecuritymanagementandBPMimplementationplanners.Aswithallsecurityandgovernance,thisarearepresentsasetoftrade‐offs.However,oneofthemostvaluableassetsofanycompanyisitsdata.Itisthelifebloodofthecompany,anditslossorcorruptioncanbeagame‐endlevelproblem.ItscorruptionisaseriousissueanditmustbeconsideredinanymovetoaBPMS.Suchamovepresentstheopportunitytoimprovethecontrolsplacedoncheckingdataforqualityandcompleteness.Ifdoneright,theBPMSrulescanactuallystarthelpingimprovetheoverallqualityofthedataeveninlegacyapplications.

Sofar,mostusesofBPMShavebeennarrowlyfocused,sodataintegrityhasbeenanisolatedconcern.Butthatischanging.AstheuseofBPMinanycompanyincreases,theissuetakesonanewimportancefortheBPMarchitectandimplementationplanner.

Today,somecompaniesaretryingtodosomethingaboutitandarespendingtimeandefforttogothroughthefragmentedcustomerinformationandpullingittogetherwhiletryingtocleanit.Somecompaniesareaddressingthisproblemthroughtheexternalizationofrules(outsideofthelegacyapplications).Manyarealsoinvolvedinprojectstoidentifyanddefinebusinessrulesthroughoutthecompanyoratleastinlargepartsoftheirbusiness.However,astheseneededeffortsaregoingon,itisimperativethatthedata‐captureapproachesbechangedandthatanyBPMactivityconsidersthisneedtoimprovedataintegrity.

Thisrequiresanewemphasisoncontrollingdataaccess,datause,andthewayitischecked.Italsorequiresthatcompany‐widestandardsbeputinplaceandthatnewdata‐collectionpoliciesbeappliedforeveryapplicationandeverydataaccess.ThiscanbeaccomplishedatacompanylevelmuchfasterandformuchlesscostthanothermethodsbyusingBPMStechnologytocreatenewfront‐endoperationalmanagementcapabilities.ThecontrolthecompanythinksisneededandthecreationofdatastandardsshouldbepartoftherulesthatareputinplaceandthevisionthatwillguidetheacquisitionanduseofBPMSs.

Atsomepointinthefuture,whenacompany’suseofBPMSandruleshasmatured,itisrecommendedthattheyconsiderthevalueofcreatingstringentrules‐basededitsandrunningalllegacydatathroughtheBPMS‐generatedapplicationsthatsupporttheseedits.Thiswillhelpcleandataandimprovequality.However,itwillalsorequireminingthecurrenteditrulesandthenupgradingthem.Suchaneffort

Copyright A

BPM


414

willtaketimeandrequirethoughttomakeitworthwhile;theeventualquestionformanagementisthevalueofbetterinformation.

10.5.4 Evolving as Technical Standards Change

Asnotedabove,managingandintegratingmodelstoformacompositepictureofthecompanyanditsprocessesrequiresaBPMtoolandthecarefulbuildingofbusinessandtechnicalstandards.Thesestandardswillcontroltheuseofthecompany’smodelingtoolorBPMSaswellastheapproachtakeninincrementallytyingprojectbusinessmodelsintoacompletemosaicofthecompany.

Inordertobeeffective,thesestandardswillneedtobeblendedwithcurrentIToperationalstandards,databaseusestandards,BusinessArchitecturestandards,andothers.Thiswilleliminateoverlapsanddisconnectsandcreateasetofintegratedstandardsforthecompany.Thisintegrationofstandards,however,willbeafuturegoalthatthecompanywillneedtoworktoward.Forthisreason,theuseofstandardsinanyareawillevolveandtheretrofittingofstandardswillrequiresomeadditionalwork.Thiswillbenecessarybecausemanystandardsarealreadyinplaceandtheirextension,reuse,modificationordeletionwillneedtobenegotiatedbyagroupthatincludesrepresentativesfromthemajorplayersinthecompany.

Whilethisnegotiationisgoingon,theBPMSusersshouldmoveforwardasquicklyaspossibletoprovidecontrolsforconsistencyandrepeatablesuccess.Thesestandardswillbelessspecificinaddressingbusinessissuesthantechnicalones.Thereasonisthatbusinessstandardstendtobeguidelinesasmuchasstandards.Technicalstandards,however,canbemuchmorespecificanddetailed.ThesestandardsshouldalsobeorientedtothemodelingtoolorBPMSyouhavechosenandthevendor’slistofbestpractices.Ofcourse,thesestandardsmustalsoreflectcurrentITandbusinessstandardsandpolicy,and,totheextentpossible,havemodificationsthatsupportasmanyofthecompany’sBPMtoolsandBPMSaspossible.AsadditionalstandardsrelatedtospecificITareasareadded,allstandardsshouldbereviewedandmodifiedtoreflectlinksoreliminatedisagreement,redundanciesandconflict.

AsBPMstandardsandguidelinesarebeingwritten,careshouldbetakentomakecertaintheyarenotaburden.Iftheybecometooinvasiveortoomuchwork,theywilleitherbeignoredor,iftheyaremonitored,willbegivenminimaleffort—sotheteamcansaytheycomplied.Tohelpthestandardsgroupunderstandtheburden,theymustalwayslookatthestandardsasanaggregationofrequiredwork:ithelpstoembedmembersinprojectsandmakethemdotheworkofcomplyingandreportingonthestandardssotheycanunderstandwhattheyhaveaskedtheteamstodo.

Inordertocontroltheevolutionofacompany’sBPMtoolorBPMSstandards,aninternalBPMCenterofExcellenceshouldkeeptrackofallmodificationstorelatedtechnicalandbusinessstandardsorguidelinesandhowtheyapplytotheBPMtoolandBPMSusersinthecompany.Thisincludes

InformationCollection:guidethebusinessoperationdiscoveryprocess

Copyright A

BPM


415

Simulation:controltheinformation,itsquality,andhowitismodeled BusinessProcessModelingNotation(BPMN):usedforgraphicaldesignof

processes—definesthewayeachsymbolwillbeusedandprovidesthedirectionsforthegenerationofBPMSapplications

BusinessProcessExecutionLanguage(BPEL):forcodingBPMS‐generatedapplications

eXtensibleMarkupLanguage(XML):forsharingdataanddocuments eXtensibleProcessDefinitionLanguage(XPDL):afileformatspecification

thatprovidesacommonformatforsharingprocessmodelsbetweentools Databaseanddatamodeling:definesthedatathatwillbesupportedinthe

modelsandtheschemafordatauseandstorage Java:standardsthataddressthewaythislanguagewillbeused Webservices:standardsthataddressconstruction,useandcontrol SOA:standardsthatrelatetothestrategy,use,designetc.ofSOA Testing:ensurethatgeneratedapplications,interfaces,datause,andmore

performasexpected

Note:Thislistisrepresentativeofthetypesofstandardsthatshouldbeanalyzed.Itisnotmeanttobeall‐inclusive.

TheplacetobeginthecreationofindividualBPMtoolsandBPMSstandardsiswiththevendor.Thevendorwillhaveasetofrecommendedstandardsforusingtheirtools.Next,looktoBPMassociationsandotherreliablesourcesfortheexperiencesoftheirmembers.AnInternetsearchmayhelp,butcaremustbetakeninlookingatthequalityofanythingfoundbecausethesourceofanygeneralinformationfoundontheInternetmustalwaysbesuspect.IfaBPMtooloraBPMShasbeenusedbyanotherdepartmentinthecompany,theirexperiencesmaybehelpfulinlookingatstandards.

Asnotedabove,asnewstandardsareadded,caremustbetakentoconsidertheoverallburdenthatwillbeplacedonteams.Theobjectiveisforstandardstobeacceptedandused.However,iftheybecomeaburden,theteamswillfindwaystodotheminimumpossibletocomplywiththem.Thiswilldefeatthepurposeandmustbeavoided.

10.6 Coming Soon to Help Deliver Flexibility

BPMtechnologyisconstantlyevolvingasnewsupportingtechnologiesbecomeavailable.Thissectiontalksaboutfourtechnologies/approachesthatmayincreasetheflexibilityofferedbyBPMtoolsandBPMS.

10.6.1 BPM and SaaS

SoftwareasaService(SaaS)isthelatestincarnationofthetime‐sharingconceptofthelate1970sandthe1980s.Inthisoption,SaaScustomerssignontothevendor’shardware/softwareenvironmentandusetheapplicationsfromanylocation.Thehardwareandapplicationsortoolsarelocatedexternallytothecompanyandmaybeanyplaceintheworld.Typically,companieswillpayforusebasedontheamount

Copyright A

BPM


416

oftheservicethatisused.Inaddition,accesstotheseapplicationsandtoolsisgenerallyovertheInternetandasignificantpartofthecostandmaintenanceburdenoftheclassicalcommunicationsrequirementsarereplacedbyInternetservices.Forthesereasons,proponentsclaimthatthisoptionisfarlessexpensivethanin‐housesystems.

SomeBPMtoolvendorsareadoptingthisapproachinordertoofferlower‐priceduseoftheirtoolsbychangingtheirpricemodelstoreflectactualuseofthetool.Thispromotescollaborativeaccesstothetoolsbyteamslocatedanywhereintheworldandallowsmodelanddataaccessanytime,fromanywhere.Inreality,theBPMtooluserisabsolutelyindependentofthephysicallocationofthecomputersandtheirmassstorage.Thisis,ofcourse,trueforvirtuallyallapplicationsandtoolsthatusethisaccessmodel—dependingonthearchitectureoftheapplicationsandtheuseof“thinclient”andothertechnicaldesignapproaches.

Whenmixedwithmeetingtechnologyandvideoconferencingthatsupportscommonviewingofscreenstoallmeetingparticipants,thiscreatesavirtualteamingcapabilitythatsupportstheoffshoreGlobalDeliveryModelofglobalteams,soworkneverstops.

Whileclaimsaremadeconcerningaccessanddatasecurity,timewilltellhowwellthevendors’sites,applications,tools,anddataarelockeddown.TimewillalsotellhowwellthisapproachworksinresistinghackingandthevirusesthatplaguetheInternet,nottomentionInternetdisruptions.Forthetimebeing,securityandthetrade‐offsthatarenormallyconsideredmayneedtobevieweddifferentlyinthisSaaSenvironment.

10.6.2 Network Clouds

ACloudisamodernInternet‐basedcommunicationsnetworkoptionthateliminatesspecificpoint‐to‐pointcommunicationsoverspecificlines—likeT1lines.In“cloudcomputing,”thecomputerandtheuserhavenoideaofthepaththemessageistakingtogettheintendedtargetorend‐point.Thecallandthedatapacketssimplyaresentbyadifferentrouteeachtime,asdeterminedbythecommunicationscarrier(ATT,Verizon,etc.).Asaresult,manytraditionalcommunicationconcernsceasetoberelevantinthisenvironment.Thisuseofavirtualnetworkconcepteliminatestheriskofasinglelinefailure;italsoprovidesunlimitedscalabilityintheuseofcommunicationservicesandtheabilitytotakeadvantageofInternet‐basedfeatureslikewebbrowsers.

AsBPMtoolvendorsmovetoofferSaaSalternativestocustomers,theimpactofcloudcomputingwillneedtobeconsidered.IncaseswheretheBPMtechnologyenvironmentactuallybecomesthebusiness’sIToperatingenvironment,thewaylegacyapplicationsanddataareaccessedmayopennewexternalInternetthreats.Acompany’scommunicationscapabilities,thewayitallowsInternetaccess,andthepoliciesgoverningInternetusemayalsorequirechangestothebusinessanditstechnologyarchitecture.TheseandmanyotherthingsmustbeconsideredasthecompanylooksatthebenefitsofSaaSandcloudcomputingintermsoftheapproachitwilltakeincreatingaBPMtechnologyenvironment,thetypeoftoolsuitesthat

Copyright A

BPM


417

shouldbeused,andthewayBPMwillsupportbusinessactivityandcontinuousimprovement.

ThisopenaccesstoInternetservicesalsoallowscompaniestomixelementsoftheworkandInternetcapabilitiestocreatenewandverydifferentapproachestoaccessingapplicationsandtools(seeSaaS)toprovidenewlevelsofoverallaccessreliability.But,aspointedoutabove,thisalsoopensthecompanytogreatersecurityrisksfromInternet‐basedattacks.

Inmanymodels,theInternetissimplyrepresentedasacloudtoshowthatthecommunicationspartoftheapplicationortool“system”isprovidedbyanexternalsourcethatisonlypartiallycontrolledbythecompany.SaaSaccessisoftentiedcloselytocloudcomputing,andinsomeliteraturethetwocannotbeseparated.Inreality,thisistruefromauseperspective.However,thistypeofusemustbeconsideredasacompanycreatesitsBPMenvironmentvisionanddetermineshowBPMtoolsandtechniqueswillbeusedinthefuture.ThesimplefactisthattheuseofSaaSandcloudcomputingchangestheapproachandthearchitectureofcurrentapproachestoIT;amovetothistechnologywillcreatedifferenttechnicalrequirementsthatmustbepartofanyITstrategyandplanning.

BecauseSaaSapplicationsandtheInternetcloudareexternaltothecompany,maintenanceoftheapplications,toolsandcommunicationhardware/softwarearealsooutsidethecompany.Amovetonewversionsofthesoftwareisnolongertheresponsibilityofthecompanyandthecostofmaintenanceshiftstothevendor,whotheoreticallyspreadsthecostoftheseservicesovertheentireusercommunity.Whilethisshouldlowermaintenancecostsandimprovethequalityofanymaintenance(thevendorismakingthechangestotheirapplicationsortools),italsotakesthecompanyoutoftheupgradedecisionprocess.Thevendormaydecidenottomakechangesthatyouneed,ormaybundleachangeyouneedwithanenhancementyouarenotinterestedin,andtheywillmakechangesintheirtimeframe,notyours.Thisisreallyanapplicationortoolissue.Theimpactoninternalcommunicationswillbemorerelatedtocapabilitiesthatmaybeneededtotakeadvantageofthecompany’saccessandotherneeds.

10.6.3 Social Networking

Socialmediaarebecomingaforceintoday’sbusinessworld.NewCRMandotherapplicationsarebeingbuilttolookatthevarioussocialnetworksandminethemforcustomerandproductinformation.Whatthisinformationwillbeusedforisstillquestionable—thisissimplytooyoungapartofbusinesstoknow.Butitisclearthattheminingofsocialnetworkswillberule‐driven,andtheuseoftheinformationwillfeedbacktochangesinthebusinessandIToperations.Tohaveanyrealimpact,thecompanywillneedtheflexibilitytoimplementthechangesdrivenbysocialnetworkdataveryfast.ThisneedforrapidchangeandbusinessevolutionisakeydriverinthemovetoBPMStechnicalenvironments.Onlytheseenvironmentsprovidetheabilitytochangequickly.Theyarealsotheonlyenvironmentthatofferscontroloverthesechangesandanabilitytoworkcollaborativelywithallaffectedbusinessgroupstodefine,simulate,andimplementtheneededchanges.

Copyright A

BPM


418

Butthisenvironmentisbasedonthecreationofcurrentbusinessmodelswithdefinedrules.Untilthesemodelsareinplace,theabilityofthecompanytoreacttoinformationfromsocialmediaandothersourcesisrestrictedtothesameapproachandcapabilitiesthatareavailabletoday.

10.6.4 Dynamic Business Applications

DynamicBusinessApplicationsareapplicationsthatcanquicklyadapttochangingbusinessneeds,competitivepressure,andmarketopportunity.Theyaretheoreticallydesignedtosupportcontinuouschange.Thisabilitytoadaptquickly,changethebusiness,andadaptapplicationsatthepacethebusinessneedshasbeenagoalformanyyearsandsimplywasnotwellsupportedbeforefullBPMSsandtheenvironmentthattheirtechnologycreates.

Nowitispossible,withfullBPMSsandthetechnicalenvironmenttheyoffer,tochangemodels,rules,andinformationandtogenerateapplicationsveryquickly.ThisabilityisextendedbeyondBPM‐generatedapplicationstotheuseoflegacyapplicationsanddatawhenthecompanymovestoSOAandhastheneededSOA/EAIlegacyapplicationadaptorsinplace.

Ofcourse,theabilitytochangefastrequiresanabilitytolookathowthecompanyneedstoevolveandthencontrolthatevolution.Itisalsoimportantthatanyrapidchangepreservetheintegrityoftheotherapplicationsystems,thebusinessoperation,andbusinessrulesregardingdataaccessanduse.

ThisflexibilityandthespeedofchangethatafullyfunctioningBPMSenvironmentoffersisadrivingforcebehindBPM.ItreliesonthecreationofbaselinemodelswithsoundruledefinitionandtheimplementationofanSOAenvironmenttosupportaccesstolegacyinformation.OncethisisinplacethemodelscanbechangedveryquicklyandtheBPMapplicationsregenerated.Thisabilitytochangequicklyandconstantlymakeschangesupportdynamic.

10.7 Vision of the Future

Inthenot‐too‐distantfuture,BPMSswillhaveevolvedtothepointwheretheywillbeabletogeneratecodemodulesthatusecomplexlogicinsupportoftransaction‐levelapplications.SomevendorsclaimtheirBPMScandothistoday.Aspartofthisdirection,BPMispullingthebusinessuserandtheITtechnicianclosetogetherandpromotinganewlevelofcollaboration.WithBPMitisnotappropriatetosimplyaskusersforspecsaswehaveinthepast.InBPMthenewbusinessmodelsandtheirrulesareusedtogeneratebusinessmanagementapplicationsanddefinethespecsforlegacyapplicationchanges.TheBPMmanagementapplicationsandthebusinessactionsperformedbypeopleformamodelofthebusinessthatisexecutedintheBPMStechnologyenvironment.ThebusinessuseractuallysignsontoapplicationsthroughtheBPMS,whichthencontrolstheexecutionoftheapplications.Theresultisanenvironmentwherethebusinesscannotbeseparatedfromitssystemsandviceversa.

Copyright A

BPM


419

Whenthishappens,theworldofITasweknowitwillchange.Thegoalistheabilitytochangeveryfast.Tohelpinthisactivity,anewtypeofanalystwillbeneeded.ThispersonwillhaveonefootinthebusinessandonefootinIT.Butthispersonwillbeahybridbetweenabusinessdesignerandatechnician.HeorshewillneedtounderstandexactlyhowthebusinessfunctionsandwhatisimportantinperformingtheworkalongwiththeBPMS,thelegacyapplicationsandthedata.

Manybelievethattoolavailabilitywillbedeliveredthroughcloudcomputingandthatmostapplicationaccesswillbethroughacloud‐typeofservicearchitecture.TheBPMSvendorsarelookingatthistrendandmanyarestartingtomovetothistypeofamodel.However,thistransitionwilltaketime,anditcanbeexpectedtolagbehindotherapplicationusemodelsuntilcloudarchitecturebecomeswidelyaccepted.

Butthekeytofuturesingle‐purposeBPMtoolsandBPMSuseandevolutionislikelytoremainfocusedoneaseofuseandspeedofdelivery.Thesefactorsarecriticaltobuildinganenvironmentthatisgearedtosupportrapidchangeandthusbusinessimprovement.

Inthefuture,theissuewilllikelychangefromthequestionof“canwedothis?”to“shouldwedothis?”ThiswillchangethedynamicinbusinessandIT.AsBPMSenvironmentsbecomemoreflexibleandofferagreaterabilitytosimplyregeneratelegacyapplications,thecompanywillhavetheabilitytodothingsthatitcannotdotoday.Inthisenvironmenttheissuesrelatedtoaccessandothertypesofsecuritywillneedtobebalancedwiththeneedtosupportrapidchange.Theissuesofcontrolinthefuturewillthusbecomeevenmorecriticalthantheyaretoday.

Butthetoolsstillhavealongwaytogobeforethisbecomesreality.So,whilethisenvironmentiscoming,advancedcompanieswillhavetimetodealwithanevolvingsetofissuesastheiruseofBPMmatures.

Inthisjourney,BPMvendorswillcontinuetomerge,formalliances,andintegratetheirtoolsuites.Theimportantfactorinthisownershipshufflingisthatanytoolsuitethatischosenshouldcomewithguaranteesofcontinuedsupportregardlessofwhomaypurchasethecompanyorwhomthecompanymaypurchase.

WhiletheevolutionofBPMtoolsissettochangethefaceofbusinessandIT,thecompany’sbusinessstrategywillbethedrivingforcebehindtheadoptionofaBPMvision.Businessstrategymustdeterminethetypeoftechnologythatisneededtodeliverthebusinessoperationvision.Withoutthisdirecttietostrategyandoperatingvision,neitherBPMtechnologynoranyotherautomationcanbejustified.Thecreationofthebusinessvisionmust,however,takeintoaccounttheemergingBPMtechnologycapabilitiesandthepotentialforaverydifferentandflexiblebusinessoperation.ThisstrategiccollaborationbetweenITandthebusinesswillneedtobesomewhatvisionaryasitreachesoutbeyondthethree‐yearhorizon.TheneedsofthebusinesswillclearlydrivethelimitsoftheITvisionandthewaythecompany’sITarchitectureandsupportvisionwillchange.However,ITcommunications,technicalsoftware,andhardwarerealitieswillplayasignificantroleindeterminingtheevolutionofthecompanyanditsabilitytocreateaflexible

Copyright A

BPM


420

changeenvironment.Forthesereasons,supportingthisnewBPM‐basedvisionwillrequireanewtypeofITstrategythatclearlymergescompanybusinessstrategy,departmentoperatingstrategy,andITstrategytocreatearealisticacquisitionandimplementationplan.

Theotherlimitingfactorisfinancialreality.MovingtoafullBPMtechnicalenvironmentisnotsimplenorcanitbecompletedquickly.Itisalsoexpensive.Legacyapplication‐wrappinginamovetoSOAisexpensiveandrequiresacommitmenttochangethebasictechnicalenvironment.AmovetogobeyondusingBPMtoolsforspecificproblemsolutionsalsorequiresadifferentvisionforITservicedeliveryandadifferentvisionofhowthebusinesswilloperate.Thisisoftenexpensiveanddifficulttosell.ButtheimplementationofaBPMplatformcanbeaccomplishedgradually,andtheamountofdisruptiontothebusinesscanbeminimizedbyapproachingthemoveinincrements.Thiswillcontrolcostsandlimitriskwhileallowingthemovetobecontrolledandfocusedonhigh‐valueimprovements.

10.8 Summary: Advantages and Risks of Process Automation

BPMtechnologyisevolvingrapidlyasvendorsleapfrogoneanotherintheirdrivetoofferthefeaturesandabilitiesthatthemarketisdemanding.Thiswillcontinue.Inaddition,vendorsareconsolidating.Biggeronesarebuyingthecompetitionandwecanexpectthatsomeoftheseproductswillbeintegratedintothepurchaser’sproductsuite,whilesomewillsimplybesunset.

ThetechnologysideofBPMisbothdynamicandvisionary.Thisisadouble‐edgedsword:withtheadvancescomethedisruptionofchangingtonewversionsandthecostofmigratingsystemstothesenewversionsandofferings.Butthedirectionisfairlyclear,andthefactthatBPMischangingthewaybusinessandITinteractwillhelpcompaniestodeliverimprovedautomatedsupport.

ThepastapproachoflookingatBPMtechnologytohelpcreatesolutionstobusinessproblemshasproventhevalueofBPM,andmanycompaniesarenowgoingbeyondthistrialtolookatbroaduseofBPMintheircompanies.Asthishappens,anunderstandingofhowthetechnologyworksandwhatitcandobecomesakeypartofanyBPMprofessionalpractitioner’sknowledge.GiventheevolutionofBPMandthetechnologythatsupportsit,thepractitionerwillneedtotrackchangesandcapabilitiesandremaincurrentonhowthetechnologyofBPMischanging,ifheorshewantstoremaineffective.ItisthisunderstandingoftheevolutionofBPMthatisdrivingtheevolutionoftheABPMPCBOK.

10.9 Key Concepts

TherearemanydifferentideasofwhatBPMtechnologyisandwhatitcando.Theseviewsareoftenalignedwithwhatthepractitioner’scompanyisdoingwithBPM.Wherethisishappening,practitionersneedtobroadentheirperspectiveandconsidermethods,approaches,techniques,toolsandcapabilitiesoutsidetheirnormalexposure.

Copyright A

BPM


421

TheuseofaBPMSisneededtosupportrapidchangethroughruleslibraries,formsgenerationforscreens,applicationgeneration,andexternaltechnicalsupport—legacyapplicationinterface,data,webservicesandJavamodules.TheBPMSusesthisinformationtosupportrapiditerationandprototypingtoshortentheoverallchangecycle.

TodaytherearetwodifferentviewsofBPMtechnology.Thesearethebusinessview,whichfocusesonmodeling,rulesandapplicationgeneration,andthetechnologyview,whichfocusesonSOA/EAIandESBwithanoverlapontheneedtocontrolrules.TheseviewsmustbebroughttogethertoformafullpictureofwhatBPMisandcando.

BPMtechnologyissoldassingle‐purposetools(modelers,rulesengines,etc.)orasintegratedsuitesoftoolsthatsupportallBPMactivityfrombusinessmodelingandrulesmanagement(withsimulation,applicationgenerationandperformancemanagement)toSOA/EAIandESB.

Thewaythetoolortoolsuitewillbeusedwillbedrivenbythebusinessviewoftheirfuturechangeability.Thismustsupportthebusinessvisionandstrategy.

ABPMtechnologystrategymustsupportthebusinessvision,butitmustalsosupportthefinancialandacceptancerealitiesinthecompany.MovingtoanenterpriseorbroaduseofBPMisaculturalchangeaswellasatechnologyandchangeapproachissue.

Toolortoolsuitesetupisimportantindeterminingthewaythetoolwillbeusedanditscapabilities.Timeshouldbetakenworkingwiththevendortomakecertainthecurrentandplanneduseofthetoolispartoftheimplementationdesign.

DataaccessandusemustbeconsideredinmovingintoSOA/EAI.Internetuseindataorapplicationaccesscarriesnewriskandcapabilities;allmustbeconsideredinthewaythisaccessisallowed.

TheuseofBPMisfoundinpocketsinmostcompanies.ThisiscausingasituationwheremultipleinternalbusinessandITorganizationshavevestedinterestsintheirtoolortoolsuite.

ItisimportantthatBPMuse,naming,quality,testing,andimplementationmethodsandstandardsbeputinplace.AllBPMmodelsandsystemsshouldbemigratedtothesecommonstandardssotheycaneventuallybefittogethertoprovideenterprisewideinformation.

FewcompanieshaveavisionofhowBPMcanworkwithintheircompany.Thisisnecessarytoprovideanoperating‐environmenttargetandaroadmapastohowtogetthere.

Tobeeffective,companiesneedtobegintheirBPMusewiththecreationofacommonbusinessandBPMvocabulary,modelingstandards,dataquality

Copyright A

BPM


422

standards,andmuchmore.Thisiscriticalincreatinganenterprisemodelandviewofthebusiness.

FewcompanieshaveaBPMarchitectureoraplanforhowBPMwillbegoverned.WithoutthisarchitectureitisimpossibletobuildtoanenterpriseuseofBPM.

Creatingabroad‐basedBPMenvironmentrequiresvisionandwilltakeyearstoimplement.Thatiswhyanarchitectureisneeded—todefineallthepartsandhowtheywillfittogether.

TheBPMtechnologyarchitecturewillbeamovingtargetthatreflectsbothcurrentBPMandothertechnology,aswellaspredictedchangestothesetechnologies.ItisimportantthatthearchitectureconstantlychangeandbekeptuptodatetobeeffectiveinguidingtheBPMenvironment.

Rapidbusinessevolutioncreatesanenvironmentwherechangecanbeacorecompetency.TheonlythingtodaythatprovidesthelevelandspeedofchangeneededtodothisisBPM—itincorporatesbusinesschange,applicationsgeneration,andtheuseoflegacydata,toallowacompanytochangefast,andwithlittlerisk.Thisspeedisthekeytooptimizationandtoimprovedcompetitiveness.

BPM’sabilitytosupportcollaboration,governanceoverthetraditionalbusinessandITactivitiesinacompanywillneedtoevolve.

ManyBPMtoolsandtoolsuitesarenowofferedina“SoftwareasaService”version.Toselectthisoption,itisnecessarytoconsider“cloudcomputing”securityanduse.

TheBPMtechnologyoftodayisadirectresultofapproximately25yearsofevolution.Itischangingrapidlyasvendorspurchaseoneanotherandasproductsaremergedorsunset.ThekeyisfortheBPMpractitionertorecognizethismarketplaceandtotakestepstoprotecttheircompanyintheleasingofanyBPMtoolortoolsuite.

BPMtoolsandtoolsuitesarebecomingmorerobust,andtheapplicationstheygeneratearebecominggoodenoughtohandleeventransaction‐systemneeds.Asthishappens,itwillbepossibletosimplygeneratemanyofthecurrentlegacyapplications—oncetheruleshavebeenminedfromthemandthelogicmapped.ThiswillchangethefaceofITandofbusiness.Butthemovewilltaketime.

Copyright A

BPM

P InternationalGlossary

ThepurposeoftheCBOKGlossaryistodefinetermsforbusinessprofessionals.ThedefinitionsarethusnottechnicalinnaturebutreflectplainbusinessEnglish.Tohelpreduceconfusionandpromoteunderstanding,sometermshavedescriptiveinformationalongwiththedefinition.

ABPMPrecognizesthatanyterminBPMorBPMStodayisopentointerpretationbecausepeopleapplydefinitionsusedwherevertheylearnedtheterm.Consequently,mosttermshavecompetingdefinitions,andthiscomplicatescommunicationincompaniesandamongBPMprofessionals.Increatingthisglossary,wehadtodecidewhethertolistnumerouscompetingdefinitionsortoprovideastandarddefinitionforeachterm.OurgoalwastocreateconsistencyinBPMdiscussionsfortheBPMindustryandourmembers,sowehaveprovidedasinglestandarddefinitionforallterms.ThisglossaryisthusastepinachievingtheABPMPgoalofcreatingastandardunderstandingofBPMthroughouttheworld.

Althoughthesedefinitionsmaybesomewhatdifferentfromthoseyoucurrentlyuse,theyaretheABPMPstandarddefinitionsandareusedthroughouttheCBOK.

Copyright A

BPM


424

A

Activity Theaggregationoftasksneededtodeliveradefinablepartofasubassemblyorservice.Anexampleisthemillingofapartthatwillbecomepartofasubassembly.Heretherawmaterialwillneedtobeheattreated,thenmilled,thendegreased,thenpolished,thentestedfortolerance.Thesetasksformadefinableoutcomeorpartofasubassembly.Inaservicebusiness(insurance),anexampleistheclaimreview,whichmaybepartoftheclaimadjudicationsubprocess,whichinturnmaybepartofthelineofbusinessmanagementprocess.Activitiescanaggregatetoformscenarios.Thesearegroupsofactivitiesandtheirtasksthatarealwaysexecutedincertaineventsorinresponsetospecificneeds—suchascustomerregistrationoron‐boardinginabankingwealthmanagementlineofbusiness.

Activity Based Costing Anapproachtocostaccounting.Itstartsbydetermininghowmuchitcoststoperformagivenactivityinaprocess,andthenaddsupcostsofallactivitiesintheprocesstodeterminethetotalprocesscosts.Fixed,variable,anddirectcostsassociatedwiththeactivityareconsidered.Thisanalyticaltechniqueisusedaspartofabusinesstransformationefforttogainanunderstandingofthecostandincomeassociatedwithaproductorservice,inordertodeterminetrueprofitability.

Agile Methodology Oneofseveralsoftwaredevelopmentmethodologiesbasedoniterativeandincrementaldevelopment,asopposedtotraditionallinearorwaterfall‐typesoftwaredevelopmentmethodologies.Anagilemethodologyprovidesaframeworktosupportthedesign,development,andtestingofsoftwaresolutionsthroughouttheirlifecycle.

Agilemethods(e.g.,Scrum)encouragerapidandflexibleresponsestochangebypromotingadaptiveplanning,collaborativerequirementidentification,andrationalizationbetweenself‐organizingcross‐functionalteam,aswellastime‐boxed,incrementaldevelopmentofsolutions.Manymoderncommercialsoftwaredevelopmenteffortsfollowthistypeofapproach.

Architecture Inprocessmodeling,apurposefularrangementofmodelsinaframeworkthatdescribesawholebusinessintermsofitscomponentparts.Thesemaybecreatedincompliancewithwell‐knownframeworkstoreduceambiguity.ExamplesincludearchitecturesbasedonTheZachmanFrameworkanditsderivatives,suchasTheOpenGroupArchitecturalFramework(TOGAF).

ARIS (Architecture of Integrated Information Systems) Anapproachtoenterprisemodeling.Itoffersmethodsforanalyzingprocessesandtakingaholisticviewofprocessdesign‐managementworkflowandapplicationprocessing.TheARISapproachprovidesawell‐documented,methodologicalframeworkforBPM,basedonProf.AugustWilhelmScheer’sresearchfromthe

Copyright A

BPM


425

1990s.ARISusesamodelinglanguageknownasEventDrivenProcessChain(EPC),whichbringsmultipleaspectsofenterprisemodelingtogetherusingtheARISHouseofBusinessEngineeringframework.

B

Benchmarking Acomparisonoftheperformanceofaprocessinoneorganizationtoperformanceofsimilarprocessesincompanieswithinthesameindustry.Manycompaniesseekbenchmarkdatatohelpwithbusinesstransformationeffortsanddeterminehowwellothercompaniesaremanagingsimilarprocesses.

Big Data Datafromtheoutsideworld,obtainedfromsocialmedia,sensors,andmobilecapture.

Bottleneck Aconstraintthatcreatesabacklogaroundthe“bottleneck.”Usually,theseconstraintspreventthesystemfromachievingmoreofitsgoals.Therearemanywaystheconstraintscanshowup.Theycanbeinternalorexternaltothesystemtypesandcouldbearesultofequipment,people,policies,orineffectiveprocesses.Identifyingconstraintsandalleviatingbottlenecksareoftenakeyobjectiveofbusinesstransformationprojects.

Business Analysts (BAs) Apersonperformingthisroleisresponsibleforanalyzingthebusinessoperation’sworkandworkflowtohelpproposechangesthatwilleliminateproblems,cutcost,improvequality,andimprovecustomerinteraction.Onceimprovementsareidentified,theBusinessAnalystthendefineshowinformationtechnologychangescanimprovethebusinessoperation.BusinessAnalystsusuallyworkaspartoftheprocessteam.

Business Architecture Thedesignofabusinessoperation,usuallydescribedintermsofbusinesscapabilitiesandsupportingtechnologycapabilities.Thisdesignisconceptualandisusedtodeterminehowabusinesswillneedtochangetosupportagivenstrategy.

Business Architect Apersonperformingthisroleisresponsiblefordetermininghowthebusinessoperationneedstochangetosupportbusinessstrategy.TheBusinessArchitectworkswiththecorporateplanninggrouptodefinethebusinessoutcomesneededtodeliverthestrategy,andtoidentifyhowthecurrentandanticipatedbusinesscapabilitieswillneedtochangeinordertoproducethesedefinedoutcomes.TheBusinessArchitectthenworkswiththeProcessArchitecttodefinehowthecompany’sprocessesmustchangetosupportthismixofcurrent/modifiedandnewbusinesscapabilities.

Copyright A

BPM


426

Business Process Improvement (BPI) Businessprocessimprovementfocusesonincrementallyimprovingexistingprocesses.Therearemanyapproaches,includingthepopularSixSigmaapproach.BPIisusuallynarrowlyfocusedandcontinuouslyappliedatvariousstagesduringthelifeofaprocess.BPIincludestheselection,analysis,design,andimplementationofthe(improved)process.Thisusuallyresultsinaninitiativeorprojecttoimprovetheperformanceofaparticularprocessinalignmentwiththeorganizationalstrategyandcustomerexpectations.

Business Process Management (BPM) BPMisamanagementdisciplinethatintegratesthestrategyandgoalsofanorganizationwiththeexpectationsandneedsofcustomersbyfocusingonend‐to‐endprocesses.Itbringstogetherstrategies,goals,culture,organizationalstructures,roles,policies,methodologies,andITtoolsto

(a) Analyze,design,implement,control,andcontinuouslyimproveend‐to‐endprocesses,and

(b) Establishprocessgovernance.

Itisfocusedondeliveringoperationalimprovement,or,inalarge‐scalechange,transformation.Thisprocess‐centricapproachtobusinessmanagementissupportedbyautomatedtoolstodeliveranoperationalenvironmentthatsupportsrapidchangeandcontinuousimprovement.BPMprovidesaviewofthebusinessactivitythroughtheuseofprocessmodelswithclearlyvisibleassociatedbusinessandtechnicaloperationalrules.

BPM Methodology Aformal,written,comprehensivelistoforganizedtaskswithsupportingdocumentationonhowthetasksshouldbeperformed,thedatathattheteamshouldlookfor,andidentificationofthedeliverablesfromtasks.Alltogether,thisinformationshouldprovidedirectiononhowtheBPMS/BPMprojectshouldbedone.

Business Process Management Center of Excellence (BPMCOE) Aninternalgroupwithinacompany,whichspecializesinBPMandBPMSuseandhelpsthebusinessaddressenterpriseprocessmanagementandperformanceissues.

Business Process Management Operating Environment BPMtodaymeldsBusinessProcessdesign,improvement,andtransformationmethodsandtechniques,withBusinessProcessManagementSuite(BPMS)automationcapabilitiestoachieveradicalBusinessTransformation.Inthisemergingenvironment,theBPMteamsusethefullspectrumofBPMStoolstodeliverbusinessandITchange.Together,BPMandBPMSformanewoperatingenvironmentthatintegratesnewbusinessmanagementautomationwithlegacyproductionapplicationstoopenaccesstodataandfunctionality.

Copyright A

BPM


427

Business Process Modeling Thesetofactivitiesinvolvedincreatingrepresentationsofanexistingorproposedbusinessprocess.Itcanprovideanend‐to‐endperspectiveoraportionofanorganization’sprimary,supportingormanagementprocesses.

Business Process Modeling Notation (BPMN) AsetofgraphicalstandardsthatspecifythesymbolsetsthatwillbeusedinBPMdiagrams/models.Assuch,theydefinethesymbolsthatwillbeusedindepictingprocessandworkflowinbusinessmodeling.

CreatedbytheBusinessProcessManagementInitiative,nowmergedwiththeObjectManagementGroup(OMG),aninformationsystemsstandardssettinggroup,BPMNhasgrowingacceptanceasastandardfrommanyperspectives,whichhasresultedinitsinclusioninseveralofthemostwidelyusedmodelingtools.Itprovidesarobustsymbolsetformodelingdifferentaspectsofbusinessprocesses.Likemostmodernnotations,thesymbolsdescribedefiniterelationshipssuchasworkflowandorderofprecedence.

Inadditiontosymbolstandardization,BPMNattemptstostandardizeterminologyandmodelingtechnique.ItservesapurposesimilartotheEventProcessChain(EPC)notationusedintheARISmethodology.

Thisstandardhasgonethroughseveraliterations,thelatestbeing2.0.However,thestandardwillcontinuetobemodifiedandtheversionnumberandcontentwillchange.ItisanticipatedthattheBPMmodelingtoolvendorsandBPMSvendorswilladjusttothestandardsastheychange.

AlthoughBPMNprovidesasetofstandardmodelingsymbols,mostorganizationswillstillneedtoapplytheirownarchitecturalandengineeringstandardstohaveacompleteBPMmodelingsolution.

Business Process Management Suites (BPMS) Asetofautomatedtoolsthatallowsthebusinesstobemodeled,showingflow,ruleuse,datauseandmore.ThisprovidesanintegratedsuiteofsoftwarethatdefinestheapplicationarchitectureandinfrastructuretechnologyneedsfortheoperationandexecutionoftheapplicationsthatrunwithintheBPMStechnicalenvironment.TheBPMSoperatingenvironmentaddressesbusinessusers'desiretoseeandmanageworkasitprogressesacrossorganizationalactivity.

ABPMSsupportsprocessmodeling,design,development,andthemanagedexecutionofworkandapplications.TheinformationintheBPMSdesignandruleslibrariesisusedtoautomaticallygeneratetheapplicationsthatareusedinthesolution.Thisallowsveryfastchange,withcontroloverthewaythechangewillbeapplied.

ABPMSprovidesanewtypeofbusinessenvironmentthatmeldsthebusinessandIT.Weusetheterm“environment”todescribetheresultingoperationwhenusingaBPMS,becausethesetoolsuitesgeneratetheapplicationsandprovidetheoveralloperatingenvironmentthroughwhichthebusinessandtheapplicationsrun.

Copyright A

BPM


428

Whilecomponentpartsofthesetoolsuiteshaveexistedsincethelate1980s,theywerenotcombineduntilabreakthroughintheearly2000’s.Therealbreakthroughthatallowedthiscoalescingofproductswastheadventofrules‐basedapplicationgenerationthatwastiedtoprocessmodels.Since2003,variouscomponentproductshavebeenbroughttogethertoformBPMproductsuites.ItisthemeldingoftheBPMapproaches,techniques,andtools,alongwiththeirabilitytoquicklygenerateapplications,whichdeliversthespeedneededtooptimizeanoperationandtosupportrapidchange.Thisabilityiswhatdeliversbothinitialoptimizationandcontinuousimprovement.

BPMS Architecture AdesignofhowthevariouscomponentsoftwaretoolsthatworktogethertoprovideaBPMSenvironmentfittogether.

BPMS/BPM or BPMS‐Supported BPM AbusinessoperationthatfollowsaBPMapproachtoimprovementusingaBPMStooltodriveandsupportbusinessactivityandcoordinatetheuseoflegacyITapplications.Thisformsanoperating“environment”wherethebusinessactuallyrunsusingtheBPMS.

BPMS Repositories Electronicdatabases(repositories)thathavetheabilitytostoreamajorityofanorganization’sbusinessprocessinformationinasinglelocation.ThiscansignificantlyreducetheneedformanaginglargevolumesofMicrosoftOfficedocuments(e.g.,Word,ExcelandVisio)andsimplifiesversioncontrol.Theydonothowever,usuallystoreallthereal‐timedatathatiscollectedfromtransactionsprocessedthroughtheBPMS‐supportedbusinessoperation(throughdataentryinthescreensthatareused)orobtainedfromLegacyBusinessApplicationsorDatabases.

Business Process Transformation Thefundamentalrethinkingofaprocess.Thisisfocusedontheend‐to‐endalignmentandchangeofabusiness’sfunctions,processes,organization,data,metrics,andtechnologyinaccordancewiththestrategicobjectivesandtacticaldemandsofthebusiness,deliveringasignificant,measuredincreaseincustomervalue.

Thegoalisinnovationandtheapplicationofnewconcepts,capabilities,technology,etc.,tothedesignoftheworkthatneedstobedone.Inthisbusinessredesign,noideaisoffthetable.Nooptionisinitiallyrejected—unlessbycompanypolicy,laworfinancialreality.Improvementisthusnotthegoal,butaby‐productofaradicalchangetothewaytheprocessisapproachedandperformed.Thislevelofchangeisbynatureinvasiveandwillbedisruptive.

Copyright A

BPM


429

C

Capability Maturity Model (CMM) ACapabilityMaturityModel(CMM)listsimportantactivitiescommontosimilarorganizationsandprovidesratingscales(e.g.,1‐5)foreachactivity,alongwithdescriptionsofwhateachratingmeans.ACMMisawayofevaluatinghowwellanorganizationdoeswhatitdoes.CobiTisanexampleofaframeworkthatcontainsaCMMusedtoratetheactivitiesofInformationalTechnologydivisionsacrossallstagesofservicedesignandimplementation.TheratingsofaCMMmaybecorrelatedtoothermeasuresoforganizationalsuccess,suchasbrandvalue,profitability,andmarketgrowth.

ACMM,whenusedbyexternal,impartial,third‐partyevaluators,helpsotherinterestedpartiescomparemultipleorganizations.Whenusedinternally,aCMMcanbeusedtoestablishanorganizationalvision,andorganizationalandindividualgoals.Thishelpssetthetime‐frameinwhichanorganizationmayachieveeachleveloftheCMM.

Change Management Astructuredapproachtomanagethepeople‐andorganization‐relatedaspectsofchangetoachievethedesiredbusinessoutcomes.Itisaimedathelpingmanagement,employeesandstakeholderstoacceptandembracechangeintheircurrentbusinessenvironment.Thisofteninvolvesconductingformalchange‐impactassessments,developingindividualactionplans,improvingcommunications,andprovidingtrainingtocounterresistance.Theresultisthattheseplanshelpalignchangestotheoverallstrategicdirectionoftheorganization.

Continuous Improvement Anapproachtooperationalprocessimprovementthatisbasedontheneedtocontinuallyreviewoperationsforproblems,costreductionopportunity,streamlining,andotherfactorsthattogetherallowoptimization.Oftenassociatedwithprocessmethodologies,continuousimprovementactivityprovidesongoinginsight,measurement,andfeedbackonprocessperformancetodriveimprovementintheexecutionofprocesses.

InContinuousImprovement(followingevaluationtechniqueslikeSixSigma)businessmanagersworkwithBPMandITprofessionalstoimplementperformancemonitoringandmeasurement—i.e.,toidentify,define,measure,analyze,improveandcontrolbusinessprocesses.Thisleadstoanongoinglistofimprovementopportunitiesandrelatedprojectsthatallowthecompanytooptimizeitsoperations.

Critical Success Factor (CSF) CriticalSuccessFactors(CSFs)arethoseactivitiesandcapabilitiesthatareessentialforacompanytosucceedinitsmarket.CSFsarethosefewthingsthatabsolutely,positivelymustgorighttoensuresuccessfortheorganization.Becausethesefactorsareindustry‐andattimesgeographically‐specific,theywillvaryfrom

Copyright A

BPM


430

companytocompany.Thesefactorsrelatetowhatthecompanyneedstodotosucceedinacontinuousmanner,notnecessarilywhatitiscurrentlydoing.

Typicallyreferringtoprocess‐relatedimprovementprograms,CSFsarethekeyfactorsasrelayedbystakeholdersthatareimportanttothesuccessoftheproject/program.

Cross‐functional processes SeeEnterpriseProcessManagement

Cloud Computing CloudComputingisthedeliveryofcomputingresourcestoanorganizationasacompleteserviceovertheInternet,ratherthanhavingtheorganizationpurchaseeachcomponentseparatelyandinternallymanageandsupportthecomputingresource.Thinkofitasrentingacomputingresourceinsteadofbuying,building,andoperatingyourowncomputinginfrastructure.Similartothe“time‐share”computingservicesofthe1970s,1980sand1990s,cloudcomputingprovidesuserswithaccesstosoftwareapplications,data,hardwareandsupportresourceswithouttheusersneedingtoknowthelocationandotherdetailsofthecomputingenvironment.End‐usersaccesscloud‐basedapplicationsthroughaWebbrowser.Accessistobusinesssoftwareanddatathatarestoredonserversatremotelocations.CloudComputingisalsoreferredtoasSoftwareasaService(SaaS).

D

Data Flow Analysis Ananalysistechniquethatseekstounderstandhowdataflowsthroughasystem.Itlooksatdatauseindifferentpartsofanorganizationaswellashowdataisusedbyapplicationssupportingagivenbusinessprocess.

DCORTM DesignChainOperationsReference:areferencemodelcreatedbytheSupplyChainCouncil.

Dynamic Business Applications Applicationsthatcanquicklyadapttochangingbusinessneeds,competitivepressure,andmarketopportunity.

E

Enterprise Process Management (EPM) EPMistheapplicationofBPMprinciples,methods,andprocessestoanindividualenterprise.It(a)assuresthealignmentoftheportfolioandarchitectureofend‐to‐endprocesseswiththeorganization’sstrategyandresources,and(b)providesagovernancemodelforthemanagementandevaluationofBPMinitiatives.

Enterprise Process Model(s) Amodelthatshowsthefullend‐to‐endactivity(high‐levelview)neededtocreatetheoutcome(serviceorproduct)oftheprocess.EnterpriseProcessModelsmay

Copyright A

BPM


431

alsobeknownasvaluechainmodels.Dependingontheneedsoftheorganizationorproject,thesemodelscanbecreated,atdifferentlevelsofdetail—processesdecomposedintosubprocesses,activities,andtasks—toprovideacompletefunctionalview.

Enterprise Resource Planning (ERP) systems Apre‐packagedsetofbusinesssoftwareapplicationsthathelpintegrateinternalandexternalmanagementinformationacrossanorganization.Typicalareasoffunctionalityincludefinance/accounting,salesandservice,manufacturing,inventorymanagement,procurementandcustomerrelationshipmanagement.ERPsystemscanrunonavarietyofcomputingplatforms,andtypicallyfeatureacentraldatabaseforstoringinformation.

Enterprise Service Bus (ESB) Asoftwarearchitecture—supportedbyasetofsoftwaretools,software,andacommunicationmediumorcarrier—thatmovesdatabetweenapplicationsandcommunicationsequipment.ThecombinedESBcomponentscontrolthemovementofdatabetweencomputers.

Event Process Chain (EPC) Event‐drivenProcessChainmodelsareatypeofflowchartusedforbusinessprocessmodeling.TheyserveapurposesimilartoBPMNmodelsinsupportingbusinessprocessimprovementbyhelpingtolinkdifferentviewsofanenterprisemodeltogether.AnEPCconsiders“events”astriggerstoorresultsfromaprocessstep;thisisusefulformodelingcomplexsetsofprocesses.EPCtriggersresultingfromaprocesssteparecalled“functions.”Thus,theflowisnormallyevent‐function‐event.

F

Failure Mode and Effects Analysis (FMEA) AFMEAisaSixSigmariskassessmenttechniquethatidentifieshowaproduct,service,orprocesscanfail,estimatestherelatedrisks,andprioritizesactionsthatreducetheriskoffailure.

Flow Charting Atypeofdiagramthatrepresentsinvisualformatasequenceofevents,processingsteps,and/ordecisions.OriginallyapprovedasanANSIstandard,flowchartingincludesaverysimpleandsmallsetofsymbols,whicharenotstandardized;itfacilitates“quickcapture”ofprocessflow.

Framework Inprocessmodeling,aframeworkisanyplannedassociationamongthemodelsappliedtomeetapolicy,design,orusabilityrequirement.Theframeworkmayormaynotbearchitecturallysignificant.Example:avaluechainforaprocess,withoverlaysdepictingaspectsofperformers,timing,andfinancialelements,andwitheventchainsdescribingdetailsofprocesssteps.

Copyright A

BPM


432

G

BPM Governance BPMGovernanceorchestratestheprocessofprocessmanagementandprovidesasustainablecontinuousprocessimprovementcapability,whichisalignedwiththebusinessstrategy.

H

Handoffs Anypointinaprocesswhereworkorinformationpassesfromonesystem,person,orgrouptoanotherisa“handoff”forthatprocess.Handoffsareoftenillustratedasprocessinterfacesorintermediaryevents.

I

Integrated Definition Language (IDEF) AFederalInformationProcessingStandardthathighlightstheinputs,outputs,mechanisms,andcontrolsofaprocess,andclearlylinksprocessesupanddownlevelsofdetail;IDEFisagoodstartingplaceforanenterprise‐wideviewofanorganization.

ITIL ITILstandsforInformationTechnologyInfrastructureLibrary.ItisacollectionofbestpracticesforInformationTechnology(IT)servicemanagement.

J

K

Key Performance Indicator (KPI) KPIreferstothemetricsormeasuresofaprocessthatareindicativeofoverallperformance.

Companiesthatmeasureperformanceshouldhavesettargetsandstandardsformeasuringperformanceonthosethingstheyconsidertobereallyimportant.ThesemeasuresarecalledKeyPerformanceIndicators(KPIs).KPI’smeasurefactorsthatmanagementbelievesareanindicationofoperationalexcellence.Tobearealisticindicator,eachKPIshouldbebasedonareasonabletargetandshouldchangeovertimeasthebusinessimproves.

L

Lean Aphilosophyandapproachthatstressestheeliminationofwasteornon‐value‐addworkthroughafocusoncontinuousimprovementtostreamlinetheoperations.Itiscustomer‐centricandstressestheconceptofeliminatinganyactivitythatfailstoaddvaluetothecreationordeliveryofaproductorservice.Leanisfocusedonprovidinghigherquality,reducedcycletime,andlowercosts.Becauseitproduces

Copyright A

BPM


433

improvedproductionsystems,itisbelievedtoincreaseproductioncapabilityandflexibility.Butinpractice,itsconceptscanbe,andhavebeen,appliedinallareasofabusiness.JamesWomackandDanielJonesdevelopedtheterm“Lean”intheirbookabouttheToyotaProductionSystem(TPS),THEMACHINETHATCHANGEDTHEWORLD.Today,Leanissupportedbytoolsandstatisticalmethodsthat,althoughnotasrobustasthoseofSixSigma,areanimportantpartofimprovementprojects.ForthemostpartLeanhasbeenusedinmanufacturing,whereorganizationsareapplyingLeantoolsinserviceandtransactionalsettingswithgreatsuccess.Typicalresultsshowdramaticreductionsintimewhilesignificantlyboostingquality.ThisapproachissometimescombinedwithSixSigmatechniquesandreferredtoasLean/SixSigma(L‐SS).

M

Measurement Thequantificationofdata(ordataset)inanacceptablestandardandquality(accuracy,completeness,consistency,andtimeliness).

Measurable Activity Anyproperlydefinedactivityismeasurable.Ataminimum,thenumberofcasescomingintotheactivity,thetimeintheactivity,theerrorrate,andmultipleotherfactorscanbemeasured.Thatanactivitycanbemeasuredhowever,doesnotmeanitshouldbemeasured.Ameasurableactivityisonethatshouldbemeasured.Itmaybeacostdriver,aqualitycheckpoint,orsomethingelse.Butcareshouldbetakeninidentifyingmeasurableactivitybecauseitiseasytomeasurethewrongthings,anditiseasytoover‐measureandcreateworthlessreports.

Metric Aquantitativemeasureofagivenattributeinasystem,component,orprocess.Metricrepresentsanextrapolationoramathematicalcalculationofmeasurements,resultinginaderivedvalue.

Modernization Activitythatusestheknowledgeofthecurrentoperationandleveragesnewtechnology,newmanufacturingtechniques,andnewmanagementphilosophiestodefinehowtheproductsorserviceswillbeproducedbytheoperation.

N

Notation Thespecificsetofsymbolsandtheirrulesofusageindescribingathing.TherearenotationscreatedoradaptedforuseinBPM,justasinotherfields.Flowchartingisanexampleofanotationusedbothforbusinessprocessdocumentationandfordocumentingcomputer‐programminglogic.OtherexamplesincludeBPMNandEPC.

Copyright A

BPM


434

O

P

Performance Management PerformanceManagementistheuseofperformanceinformationtocontroltheprocessorworkflow/businessunit’sproductivity,quality,cost,etc.,againstpredeterminedtargets.Thismeasurementinformationisusedtodirectspecificimprovementthathelpsreachperformancetargets.

Performance Measurement Allbusinessactivitiescanbemonitored,measured,andevaluatedwhenproperlyunderstoodandmodeled.Althoughthismeasurementcanbeusedtomonitortheoverallperformanceofaprocess,ittypicallyreferstothemeasurementofgroupsofactivitiesagainstspecificstandards,targets,KPIsorsuccessfactors.

Performance Evaluation Theidentificationofgapsbetweenhowaprocessiscurrentlyperforminginrelationtohowitshouldbeperformingtomeettheorganization'sobjectives.Thisevaluationcanbeagainststandards,targetsorexistingperformance.

Process Aprocessisasetoffunctionsinacertainsequencethatdeliversvaluetoacustomer.Processesarestartedbyclearlydefinedexternalevents.

Theyareformedfromacombinationofalltheactivitiesandsupportthatareneededtoproduceanddeliveranobjective,outcome,productorservice,regardlessofwheretheactivityisperformed.Theseactivitiesareusuallyacross‐functional,cross‐organizationaggregationofactivitiesthatworktogethertocreateanendproductorservice.Activitiesareshowninthecontextoftheirrelationshipwithoneanothertoprovideapictureofsequenceandflow.

Thiscontextincludesadefinedsetofactivitiesorbehaviorsperformedbyhumans,systems,oracombinationofbothtoachieveoneormoregoals.Processesaretriggeredbyspecificeventsandhaveoneormoreoutcomesthatmayresultintheterminationoftheprocessorahandofftoanotherprocess.Processesarecomposedofacollectionofinterrelatedtasksoractivitiesthatsolveaparticularissue.Inthecontextofbusinessprocessmanagement,a“businessprocess”isdefinedasend‐to‐endworkthatdeliversvaluetocustomers.Thenotionofend‐to‐endworkiscriticalasitinvolvesallofthework,crossinganyfunctionalboundaries,necessarytocompletelydelivercustomervalue.

Process Analysis Processanalysisistheactofconductingathoroughreviewandarrivingatacompleteunderstandingofabusinessprocess(orportionthereof),withthegoalofmaintainingorachievingprocessexcellence,orachievingincrementaltotransformationalimprovementsinabusinessprocess.

Copyright A

BPM


435

Processanalysisinvolveslookingatallcomponentsofaprocess—inputs,outputs,mechanismsandcontrols—inspectingeachcomponentindividuallyandastheyinteracttoproduceresults.Thesecomponentscanoftenbecategorizedintothepeople,processes,applications,data,andtechnologyneededtosupportabusinessgoalorobjective.Analysescoveranduncoverquality,time,andcostsatallpointsofabusinessprocess,frominceptiontocompletion.

Aidstoprocessanalysisinclude

Visualprocessmodels,bothstaticanddynamic Datacollectedatthebeginning,duration,andendofkeyactivities,lower‐

levelprocesses,andtheentirebusinessprocessitself Businessprocessanalysismethodssuchasvaluechainanalysis,end‐to‐

endmodeling,andfunctionaldecomposition.

Sometypicalprocessanalysesare

Resourceutilization Distributionanalysis Cycletimeanalysis Costanalysis Softwareapplicationusage Global/Localprocessvariations.

Holisticbusinessprocessanalysesevaluate

Totalcostoftheprocesstools(e.g.,computersystems) Impactoftheprocessoninternalparticipants(employees)andexternal

(paying)customersandstakeholders Impactoftheprocessontheorganization’scommunity(e.g.,

environmentalimpacts)andotherstakeholders.

Process Analyst Apersonwiththisroleisresponsibleforworkingwithbusinessmanagersandstafftodefineandvalidatethecurrentbusinessoperationanddesignfutureprocessmodelswithbusinessparticipants,ProcessArchitectsandProcessDesigners.Theirroleistohelpidentifyhowabusinessoperationreallyfunctionsandthentohelpidentify,design,buildanddeployimprovement.TheyareoftencalledupontotrainprojectteammembersonmodelingstandardsandapproachesasdefinedbytheProcessArchitectandBusinessArchitect.

Process Manager or Leader Apersonwiththisrolemanagesprocesstransformationprojects,leadsprocessdiscoveryanddesignworkshops,coachesprocessowners,andmeasuresandreportsonprocessperformance.

Process Architect Apersonwiththisroleisfocusedondefining,redesigning,andoptimizingactivitiesinaprocessorgroupofprocesses.ThesepeopleworkwithBusinessArchitectsto

Copyright A

BPM


436

lookathowprocessesneedtochangetodeliverbusinessgoals,withSolutionArchitectstoensureperformance,maintainability,andscalability,andwithEnterpriseArchitectstoidentifyITcapability,limitations,andsupportchanges.

Process Component Thepartsofaprocess:inputs,outputs,mechanisms,andcontrols.

Inputsareresourcesordatathatmustbepresent,and“triggers””(differenttypesofevents)thatinvokeaprocess.

Mechanismsarethe“tools,”includingmachines,systems,andpeople,thatperform“activities,”theactionsuponandinresponsetotheinputs.

Controlsaretherequirements,constraints,guides,andrestraints;anddefininglaws,policies,rulesandregulationsthatshapeanddeterminetheactionsupontheinputs.Mechanismsandcontrolscanbethesame:forexample,regulations,money,orpeople.

Outputsaretheresultsoftheactionsofthemechanisms,guidedbythecontrolsandmechanisms,upontheinputs.Optimally,outputsareservicesorproductsmeetingorexceedingthetime,quality,orcostexpectationsofanorganization’scustomers.Theymayalsobeeventsthattriggerotherprocessesinthesameorinadifferentorganization.

Process Culture Organizationswherethebusiness’sprocessesareknown,agreedon,communicated,andvisibletoallemployees.

Process Design Processdesignistheactoftransforminganorganization’svision,goals,andavailableresourcesintoadiscernible,measureablemeansofachievingtheorganization’svision.Processdesignmaystartwithprocessanalysis;bestpracticesfromsimilarorganizations;processreferencemodelsfromindustry‐standardsorganizations(e.g.,SCORoreTOM)orthirdpartyconsultants;or“greenfield”—ideascoupledwiththeexperienceandinsightsoftheprocessdesignteam.Processdesignfocusesondefiningwhattheorganizationwilldotoachieveitsfinancialandothergoals.

Process Designer Apersoninthisroleworkswithbusinessmanagersandstafftodefineandvalidatethefuture‐stateoperationaldesignofprocesses.TheProcessDesigneristhusthecatalysttothefuture‐statedesignanditscontinuousevolution.Thesepeopleunderstandthemechanismsofthebusinessandknowhowtodevelopasolutionthatmeetsperformancetargets,isscalable,andcanbeeasilymaintained.TheProcessArchitectviewstheprocessfromtheperspectiveofhowitinteractswiththebiggerpicture(outsidein).

Process Flow Theaggregationofsubprocessesintoasequentialrelationshipthatshowstheorderinwhichtheyareperformed.

Copyright A

BPM


437

Process Management Maturity Ameasureofthestateofacompany’sjourneytoconsiderandmanageworkusingaprocesscentricapproach.Thelevelofmaturityisdefinedbycomparingthecompany’scurrentoperationagainstcharacteristicsandcapabilitiesthataredefinedinoneofthemanyProcessMaturityModelsinthemarket.

Process Manager Apersoninthisroleperformsandcoordinatestheworkonaprocessorprocessesandmanagestheprocess/processes’businessperformance.

Process Modeling Processmodelingistheactofcreatingvisibleillustrations,whichcanbestaticordynamic,ofwhatanorganizationdoestoproduceservicesorproducts(optimallyofvaluetooneormorecustomers).Optimally,processmodelingresultsinanillustrationthatanindependentevaluatorcancompareandmatchtotheorganization’sprocess.

Process Organization Anorganizationthatisstructured,organized,managed,andmeasuredarounditsprimarybusinessprocesses.Itsknowledgeareaaddressestwotypesoforganizations:

Theprocess‐drivenorganization Therolesandresponsibilitiesofthegoverningbodiesneededtosupportthe

process‐ drivenorganization.

Process Owner Apersoninthisrolehastheongoingresponsibilityandaccountabilityforthesuccessfuldesign,development,execution,andperformanceofacompleteend‐to‐end(cross‐functional)businessprocess.

Processownershipcanbeadoptedfulltimeorasanadditionalresponsibility,asalineorstafffunction.

Executiveprocessowners(EnterpriseProcessOwnersandChiefProcessOfficers)commonlyhavefinancialresponsibilityforgroupsofbusinessprocesses.Theyhaveaninherentinvestmentinthesuccessfulexecutionofcross‐functionalbusinessprocessesthatarekeytothesuccessofthecompany.

Processownersareamongtheessentialstobusinessprocesssuccess.Abusinessprocesswithoutanorganizationallyinfluentialprocessownerislikeashipwithoutarudder,propeller,andsails—thebusinessprocesscan’texecuteinthemostefficientandeffectivewaypossible.

Process Team Aprocessteamisaprocessownerandthesupporting“players”whodefine,analyze,andrefineabusinessprocess.

Themorecommonprocessteamrolesinclude

Copyright A

BPM


438

Processmanager, Processanalyst, Processdesigner,and Processarchitect,alongwith Businessanalyst, Subjectmatterexpert,and Executivemanagementandleadership

ProcessteamsareoftenadvisedbyaBusinessArchitectand/orProcessArchitect.

Q

R

Reference Model Anormalizedmodelthatprovidesahigh‐levelintegratedviewofabusiness,itstechnology,anditsdata;itisusedasareferenceforbuildingsimilarmodels.Referencemodelsareusefulinprovidingadegreeofstandardizationamongelementsofadiscipline.Awell‐knownreferencemodelisthesupply‐chainoperationsreference(SCOR),whichallowsfordescribingsupplychainsusingcommonterminologyandrelationshipstoaidincomparisonsanddiagnostics.

AnotherpopularindustryreferencemodelistheeTOMorEnhancedTelecomOperationsMappublishedbytheTMForum.TheeTOMmodeldescribesthefullscopeofbusinessprocessesrequiredbyatelecomcompanyanddefineskeyorganizationalandbusinessprocesselementsandhowtheyinteract.eTOMisoftenassociatedwithITIL,astandardframeworkforbestpracticesininformationtechnology.Manyconsultingorganizationsalsoofferbusinessprocessreferencemodelsforspecificindustries.

Risk Analysis Examinestheeffectivenessofprocesscontrolpointsagainstgivenstressestodeterminewhensomethingwillfail.Italsocanmeanthelevelofriskthatcanbeexpectedinagivencourseofactionandtheprobabilityoffailure—suchastheprobabilityofprojectfailureifagivenactionisorisnottaken.

Role Abusinessroleisagroupofrelatedskillswithalevelofauthoritytoperformagiventask.Thisincludesalltasktypeswhethertheyareamanualorsystemenabled.Businessrolesarenotthesameas:

OrganizationalJobs—ajobisarolethatexistsintheorganizationandcomprisesacommonsetofresponsibilities.Forexample,amanager’sjobincludesperformingthefunctionofadepartmentmanagerandbeingresponsiblefordirectreportemployees.

OrganizationalPositions—anorganizationalpositionisaspecificopeningthatsomeonefills(inaspecificlocation).Thisisaskill‐andlocation‐specific

Copyright A

BPM


439

openingthatisfilledbyaspecificperson.Forexample,adepartmentalmanagerintheSanFranciscooffice.

SecurityRoles—asecurityroleisatacticalobjectthatgetsassignedtoauserID,andallowstheuseraccesstothesystem.

Rules Thelogicthatdefineswhatwillbedone,whenitwillbedone,whereitwillbedone,whyitwillbedone,howitwillbedone,andhowitwillallbemanagedorgoverned.Rulescantakemanyforms,fromsimplebinarydecisionstodecisionsinvolvingmoreadvancedBooleanlogicrules.Examplesrangefromsimpleyes/nodecisionstomulti‐threadeddecisiontreestodeterminehowaprocessrespondstoagivenevent.

S

SCOR® SupplyChainOperationsReference(SCOR)isbusinessprocessreferencemodelendorsedbytheSupplyChainCouncilasade‐factostandarddiagnostictoolforsupplychainmanagement.SCORisamanagementtoolspanninganorganization’ssupplierstoitscustomers.Thisreferencedescribesthebusinessactivitiesassociatedwithallphasesofsatisfyingthecustomer'sdemands.Thisreferencemodellooksatbusinessprocessesandactivitiesusedinallstagesofsupplychainactivity.TheSCORamodelisbasedonthreemajorpillars:processmodeling,performancemeasurements,andbestpractices.Theprocessmodelisdividedintofivegroups:Plan,Source,Make,Deliver,andReturn.Eachoftheseprocessgroupsisdecomposedintoprogressivelylowerlevelsofdetailtohelpmodelsupplychainactivities.Eachlevelisadecompositionoftheactivitiesinthelevelaboveandallaresupportedbyasetofstandardkeyperformanceindicators(KPI).

Sensitivity Analysis (also known as a “what if” analysis) Ananalyticaltechniquethattriestodeterminetheoutcomeofchangestotheparametersofortheactivitiesinaprocess.Thisisameasureofthesensitivityofsomethingtoagivenchange.Itmeasuresthehypotheticalimpactofdifferenttypesofchange(suchascapacity,financialissues)ontheoverallprocess,workflow,oractivity,anditisusefulfordetermininghowachangemayimpacttheoperation.Itisalsoknownas“whatifanalysis”andisusedtosupportdecision‐makingorthedevelopmentofrecommendationsfordecision‐makersbasedonchangingcertainvariablesintheanalyticalmodel.

Alsocalledhypothesistesting,thegoalistotestthemeasurableoutcomesofperformance(e.g.time,cost)fromdifferentwaystoachievedesiredobjectives.

Service Level Agreement (SLA) Anagreementbetweentwoormultiplepartiesthatdefinesspecificlevelsofperformancerelatedtogivenactivities.TheSLAsaretargetsorstandardsthatmustbemetbyasupplier,outsourcingcompany,vendor,serviceproviderorpartner.SLAsarewritteninplainlanguagespecifyingthetargetperformancelevelsandhowthetargetperformancewillbemeasured.Theyincludethetimingoftheagreed

Copyright A

BPM


440

measurementandaclearlydefinedissueresolutionandescalationprocessforallpartiesagreeingtotheSLA.AnSLAmayalsobuildinpenaltiesorincentivestiedtoperformancetargetsforimprovedperformanceorforexcellence.

Asrelatedtoaprocess,SLAsfocusonmeasureableoutcomesthathavebeendefinedbystakeholderstomeetsetperformancecriteria.

Simulation AmodelingtechniquethatusesbusinessprocessmodelsinaBPMStooltomakepredictionsabouthowaprocessmayperformunderdifferentcircumstancesandworkloads.Businessprocesssimulationcanbe eitherformalorinformalanduseavarietyoftechniques.Processsimulationusuallyassignsvaluestoactivitiesandthendefinesanumberofanticipatedusecasestoseehowthebusinessprocesswillrespondunderdifferentcircumstances.Thesimulationofcomplexbusinessprocessescanoftenrevealoutcomesthatbusinessprocesstransformationteamscan'tanticipate.Thisisespeciallyrelevantwhentryingtomodelnewautomatedbusinessprocessesbeingcarriedoutonmobiledevices.Simulationsrequiresufficientdata,whichtypicallyallowstheprocesstobemathematicallysimulatedundervariousscenarios,loads,orotherconditions.

SIPOC SIPOCisaSixSigmatool;itstandsfor“Supplier‐Input‐Process‐Output‐Customer”.ASIPOCdiagramverifiesthatprocessinputsmatchoutputsoftheupstreamprocessandthatprocessoutputsmatchtheexpectedinputsofthedownstreamprocess.

Six Sigma Amethodthatdrivesbusinessperformanceimprovementbyreducingornarrowingvariationinworkorinquality.ThegoalistoreachastatisticalvariationofSixSigma(orsixstandarddeviationsofvariation)withinthelimitsdefinedbythecustomer’sspecifications.Sinceitsintroductionin1987,SixSigmahasbecomeoneofthemostrecognizedenterpriseimprovementmethodologiesforcompaniesseekingtoidentifybusinessproblems,defineimprovementopportunitiesandprojects,anddeliversolutionstorealizepredictableandrepeatableresults.

SOA Anapproachforlinkingresourcestoobtainorpresentdataonan“ondemand’basis.Itisadataaccessanddeliverystrategypursuedbytheenterprise—itisnotsimplyatacticortechniquethattheenterpriseadoptstopursueagoalofimprovedapplicationinterfacing.

ServiceOrientedArchitecture(SOA),isanapproachforbuildingcomputingapplicationsthatsupportorautomatebusinessprocessesbyusingasetoflooselycoupledblack‐boxcomponents.SOArepresentsadramaticchangeintherelationshipbetweenbusinessandIT.SOAmakestechnologyatruebusinessenablerandempowersbusinessandtechnologyleadersalike.

Copyright A

BPM


441

Fromatechnicalperspective,SOAisamethodtodesignandarchitectsolutions.Itcouldbeimplementedinamessagingorintegrationlayeroritcouldbeawaythatanapplicationisdesignedtoprovideservicestootherapplications.

SOA Implementation AprojectorinitiativetoimplementbusinesssolutionsusingSOAtechnology.

SOA Execution Aprogramtoinvokeaservice,butdoesnotcontain'businesslogic'.

SOA Interface Thesoftwarethatcallsdatafrom,orpresentsdatato,oneormoreapplicationsthatareexternaltotheapplicationbeingexecuted.Theinterfaceaddressinformationforlocatingtheassociatedimplementation(s)iscalledtherequest.

SOAP ImbeddedwithintheSOAumbrellaisasetofstandardsthatgoverndatatransfer.Thesestandards,namedSimpleObjectAccessProtocol(SOAP),areasetofrulesfortransferringstructuredinformationacrossanetworkintheimplementationofWebServices.

Swim Lanes Swimlanemodelsdivideascreenorpageintomultipleparallellinesorlanes.Thelanesaregenerallyrepresentedaslongverticalorhorizontalrectanglesorsometimes‐simplelinesorbars.Eachoftheselanesisdefinedasaspecificorganizationunitorabusinessrolethatapersonplaysinperformingthework.Theworkmovesfromactivitytoactivityfollowingthepathoftheflowfrombusinessunittobusinessunitorfromroletorole.Byshowingtheflowfromlane(role/organization)tolane,swimlaneshelpidentifyhand‐offsinaprocess.

Software as a Service (SaaS) Sometimesreferredtoason‐demandsoftware,SaaSisasoftwaredeliverymodelinwhichapplicationsoftwareanditsassociateddataandinfrastructurearehostedontheInternetandaccessedbyuserswithawebbrowser.Thisisthelatestincarnationofthetime‐sharingconceptofthelate1970sandthe1980s.Inthisoption,SaaScustomerssignontothevendor’shardware/softwareenvironmentandusetheapplicationsfromanylocation(commonexamplesincludesalesforceandpayrollautomation).Thehardwareandapplicationsortoolsarelocatedexternallytothecompanyandmaybeanyplaceintheworld.SaaScomputingservicesandapplicationsaretypicallymanagedandsupportedbyathird‐partyvendoronafee‐for‐servicebasis.

Strategic BPM Planning StrategicBPMPlanningdefinesthewayBPMandBPMSwillbeusedinthecompany.IttranslatesthevisionofbusinessimprovementintoactionplansandalignsrequiredBPM/BPMScapabilitieswiththeapproachthatwillbetakeninimproving

Copyright A

BPM


442

businessprocesses.Thisisimportantindeliveringthebusinessobjectivesoftransformationprojects.

Subject Matter Experts (SMEs) Theseindividualsaretypicallypeoplewhohaveadeepunderstandingofcertainbusinessfunctionsoroperations,oftenpossessingyearsofexperienceasaparticipantinbusinessoperations.ThistermisalsoappliedtopeoplewhohavedeepexpertiseinanareaofIT,productionoperations,supplychainmanagementorotherareasofactivity.

Success Criteria Thetopicsoritemsthataprojectmustaddressandthestandards,targets,andlimitsthatmustbeachievedinorderforittobeasuccess.

Systems Dynamics Models Thesemodelsare“activityonarrow”diagramsratherthan“activityonnode”diagramslikemostoftheothernotations.Thesearemoreoftenusedtomodelanentireenterpriseorlineofbusinessthantomodellower‐levelworkflow.Theydescribetheenterprisebusiness“architecture”fromadynamicbehavioralperspectiveratherthanastaticstructuralperspective.

T

Task Thestepsoractionstakentoperformaspecificpieceofwork—suchastoenteraclaim’sinformationintothelineofbusiness’claimsystem,registerapatientinahospital,orenteranorderforaprojectintoasalessystem.Anumberoflogicallyrelatedtaskscanbecombinedintoahigher‐level“Activity”.Ataskmayormaynothaveautomatedsupport.Sometaskscanevenbetotallyautomated.Thesemaybeshowninaworkflowmodeltoprovideinformationthathelpsstaffunderstandwhatishappening.Taskscanalsocombinetoformscenariosthatarerepeatedbasedonevents,timing,etc.

U

Unified Modeling Language (UML) MaintainedbytheObjectManagementGroup,astandardsetofdiagrammingtechniquenotationsprimarilyfordescribinginformationsystemsrequirements.UMLmodelsaremostoftenassociatedwithcustomsoftwaredevelopmentefforts,thoughtheymayalsobeassociatedwiththecustomdevelopmentportionsofanERPimplementationprojectfordefiningcustomreports,interfaces,conversions,andenhancement(RICE)objects.

V

Value Chain Valuechainsarelarge‐scalebusinessprocessesthatareinitiatedbyacustomerrequest,andresultinthedeliveryofaprocessorservicetoacustomer.Avalue

Copyright A

BPM


443

chainincludeseverythingthatcontributestothedeliveryofagivenproduct.Byaddingupallthecostsofeachactivityinthevaluechain,andsubtractingthetotalfromthesalesprice,anorganizationcandeterminetheprofitmarginonthevaluechain.Mostorganizationssupportfrom3to15valuechains.IntroducedbyMichaelPorterinhis1985bookentitledCOMPETITIVEADVANTAGE,thisapproachemphasizescapturingthoseprocessesandactivitiesthat“addvalue”totheserviceorproductprovidedtoacustomer.ValueChainsprovideastrategicviewofbusinessprocessesacrosstheorganizationsandproductstheysupport.

Value Chain Notations Acategoryofsymbolsetsusedtovisualizetheaccumulationofvalueorstepstowardachievementofagoal.

Value Stream Mapping AValueStreamMapisaLeanSixSigmatoolusedfordetailedprocessanalysisanddesign.Itcapturesallkeyprocessactivitiesandmetrics,andfocusesoneliminatingactivitiesthatdonotaddvaluetotheproductorservicebeingbuiltordelivered.

InLeanManufacturing,thisisusedtoaddprocessresourcecostsandtimeelementstoaprocessmodeltoclearlyshowtheflowofmaterialsandproducts,andtodepictprocessefficiency.

W

Workflow Thisisagenerictermforthesequentialmovementofinformationormaterialsfromoneactivityinaprocessorsubprocesstoanotherinthesameoverallprocess.AsappliedintheCBOK,thisistheaggregationofactivitywithinasingleBusinessUnit.Activitywillbeacombinationofworkfromoneormoreprocesses.Organizationofthisworkwillbearoundefficiency.Theactivitiesintheworkflowwillbeshownasaflowthatdescribeseachactivity’srelationshipwithalltheothersperformedintheBusinessUnit.Modellingwillshowthisworkasaflowthatdescribeseachactivity’srelationshipwithalltheothersperformedintheBusinessUnit.

Workflowscanbemanual,automated,ormorelikelyacombinationofboth.Workflowmodelsoftenincludeboththediagramandthespecificrulesthatdefinetheflowofinformationfromoneactivitytothenext.Whenusedinconjunctionwiththeworkflowsystemorengine,itusuallyreferstoasoftware‐basedworkflowsystemthatwillmoveinformationfromadatabasetoonecomputerororganizationaftertheother.

WSDL TheWebServicesDescriptionLanguage(WSDL)isastandardwayofdefininganSOAserviceinterface.

Copyright A

BPM


444

Web Services WebServicesareasetofstandardsthatenabletheintegrationofweb‐basedapplications.InBPMS,WebServicesareusedtomovedataandinitiateprocessinginapplicationsthatarenotpartoftheBPMSsolutionoperatingenvironment.

Web Application Acomputerprogramorsetofprogramsthatarecalledfromawebportalandusedtoperformagivenbusinessfunction—suchaspurchaseaproduct.Thetermmayalsomeansoftwareapplicationthatiscodedinabrowser‐supportedlanguage(suchasJava)andreliantonacommonwebbrowsertorendertheapplication'sexecutableoverinternalnetworksorovertheInternet.Theseapplicationscaneitherbepurpose‐builtorpurchasedfromavendor;theyusuallylinktootherlegacyorspecial‐purposebackgroundapplicationsthatcanaccessmultipledatabasesorperformgivenfunctionsinthebackgroundwhilethewebapplicationcontinuestointeractwiththeapplicationuser.

Web Portal Awebsitethatprovidesasinglepointofaccesstoinformationoverinternalnetworksand/ortheInternet.Webportalsusuallyprovideaccesstospecificinformationandcapabilitiesthatacompanywantstomakeavailabletoabroadrangeofpeopleinaconsolidatedmanner.Well‐structuredwebportalsallowuserstopersonalizetheirviews.Inadditiontoinformationgatheringandsharing,webportalscanbebuilttoincludeworkflowmanagement,workgroupcollaboration,andcontentmanagementfeaturestohelpdeliverself‐servicesupport.

§

ThankyouforsupportingtheAssociationofBusinessProcessManagementProfessionals(ABPMP).Ourgoalistoconstantlyimprovethediscussiontheauthorspresentedinthisbook.PleasesendcommentsandsuggestionstoABPMPathttp://www.abpmp.org/.

Glossary

445

This reference book is the copyrighted property of the ... · iv ABPMP President’s Note BPM is a rapidly growing discipline that is changing the way businesses look at managing

Documents