Modelling Business Processes - Ch. 8

Question 1

What are business processes?

Answer 1

The means by which an organisation carries out its internal operations and delivers its products and services to its customers.

Question 2

Why create a business process?

Answer 2

• To understand how the existing process works. This is especially useful if the current process has ‘grown’ organically.
• To explain to those working on a process what they do and how it relates to others working on the process. This can be used as a training aid for new staff and as an aide-memoir for existing staff.
• To help ensure consistency of approach and get everyone following the same process.
• To identify problems and weaknesses of an existing business process with a view to developing and implementing an improved process. “As Is” and “To Be” processes.

Question 3

What is a Functional Model?

Answer 3

A chart showing how the organisation is structure and where staff and management fit within it.

Cons:

• internally oriented (structure of organisation and reporting line) which is of little interest to the customer.
• static view - does not show what the business does over time in order to react to an event such as a customer’s request.
• thinking of the organisation as separate, automonmous departments may erect barriers and create operational difficulties.

Question 4

What is the Organisation Model?

Answer 4

Devised by Paul Harmon, this chart provides an alternative view of an organisation and represents both internal processes and external world with which the organisation operates.

External:

• Suppliers of resources
• Beneficiaries of organisation (customers/owners/board of trustees)
• Compeitors operating within industry or business domain
• Generic factors, such as regulation, economics or green issues.

Question 5

What is the difference between a process map and a business process model?

Answer 5

• Process Maps show sets of related processes in a single diagram.
  Each process set is shown as a box, and the arrows between them show their interdependencies.
• Business Process Models show a more detailed view of each of the processes within a higher-level set.

Question 6

What is Porter’s Value Chain?

Answer 6

A means of anaysing the activities performed by an organisation divided into primary activities and support activities.

Primary:
Marketing and sales; Service; Operations; Logistics (inbound and outbound)

Secondary:
Technology Development; HR; Infrastructure; Procurement

Question 7

What is a Value Proposition?

Answer 7

A definition of an organisation’s product or service that demonstrates to customers that we understand and can satisfy their needs. It differentiates organisations from competitors.

Question 8

What factors make up a successful value chain proposition?

Answer 8

Drivers that lead to increased customer satisfaction, acquisition and retention -covering three areas:

• products/service attributes that define the product/service itself;
  
  • Functionality
  • Price
  • Quality
  • Choice
  • Availability
• customer relationship aspects;
• image and reputation aspects.

Question 9

How can a company differeniate itself?

Answer 9

• Be the most efficient
  (high volumes, low costs, low prices);
• Have the best products
  (high quality, innovation, ability to introduce new products before the competition);
• Provide best customer service.
  (flexibility allowing the product/service to be adaptable to the exact needs of the customer, staff attitudes, staff training, empowered staff with the freedom to understand and react to changing customer needs.

Question 10

What is a business process?

Answer 10

A business process is triggered by an event and have five key components:

1. Tasks that make up the process;
2. Process flow;
3. Decision points;
4. Actors that carry out the tasks;
5. Outcome of the busienss process.

Question 11

What would you use to model a business process?

Answer 11

BPMN (Business Process Modelling Notation)

Question 12

What elements would you find in a BPMN diagram (swimlane diagram)?

Answer 12

• Overall layout;
• Symbols used;
• Sequencing of symbols;
• Naming of the tasks.

Question 13

What should be considered when building a BPMN (swimlane) diagram?

Answer 13

• Trigger (business event)
• inputs to task (trigger + other info)
• outputs from the task
• costs relevant to the task
• measures and standards
• detailed breakdown of steps within the task
• business rules to be follwed

Question 14

What other tools can you use in addition to BPMN to document additional process details, such as costs, detailed breakdown of steps, etc?

Answer 14

A flowchart or UML Activity Diagram.

Question 15

How would you go about analysing an “As Is” diagram?

Answer 15

Check for:

• Handoffs.
  Handoffs account for many of the problems experienced in traditional processes and can cause delays, communication errors and bottlenecks to occur.
• Duplciation of work.
• Lack of standardisation.
• Inconsisten measurement or control measures.

Question 16

At top level, how would you go about improving business processes?

Answer 16

• Simplify the process by:
  
  • eliminating unnecessary parts, e.g. reports that are no longer needed.
  • combining a number of tasks carried out by different actors into one task carried out by a single actor.
• Remove bottlenecks by:
  
  • Identifying and resolving mismatches in the capacities of related tasks, e.g. Task A = 100 transactions ph, Task B (handoff) = 90 transaction ph capacity.
• Change the sequence of tasks:
  
  • Modern workflow technology enables paper work to be copied and then more than one user can work on the same information, reducing elapsed time for the overall process.
  • Automate workflow using computer systems.
• Redesign the process:
  
  • Identify the tasks required in order to work from the business event towards the required outcome, then add actors to carry out the tasks (“To Be” process).
• Redefine process boundaries:
  
  • Extend or reduce the activities carried out by the organisation.
  • Redefine process boundaries to allow external stakeholders to undertake tasks, e.g. internet allowing customers to place own orders.

Question 17

What must be defined when designing an improved business process?

Answer 17

What the process does and how well that process is to be carried out, e.g. measuresments of process success.

• Internal measures, derived from objectives, CSFs and KPIs.
• External measures dervied from custoemr expectations:
  
  • Time (to complete process/task)
  • Financial (cost and price)
  • Quality (accuracy and effectiveness)

Question 18

How would you estimate a timeline?

Answer 18

• length of time taken by each task within the process;
• resources available to support tasks;
• number of transactions to be process and how this varies over time;
• variety and mix of different transaction types;
• amount of reworking caused by errors;
• delays and queues at each handoff;
• quality and productivity of staff;
• other work that could interrupt the process.

Question 19

What is Six Sigma?

Answer 19

Developed by Motorola in the 90’s, the approach is based on ideas from statistical process control and was originally used in mangufacturing industries to reduce product defects.

Its purpose is to eradicate performance deficiencies in processes that are critical to achieving customer satisfaction, such as complaint handling, order fulfilment or delivery.

It has a 5 step approach:

1. Define problem.
2. Measure data.
3. Analyse problem.
4. Improve process by removing root causes of the problem.
5. Introduce Controls to prevent the original problem from recurring.

DMAIC approach