When organizing and managing work in an organization, the key idea of BPM is to focus on
Processes
They focused on the entire process for all products
Pure generalists
They focused on the entire process for a single product
Intermediate specialist
They focused on a single part of a process for a single product
Pure specialist
Among others, this book discusses the division of labor that is used by a manufacturing company for producing pins
Adam Smith: “An inquiry into the nature and causes of the wealth of nations”
Proposed a set of principles known as scientific management
Frederick W. Taylor
A key element in Taylor’s approach is an extreme form of labor division and work analysis
By meticulously studying labor activities, Taylor developed very specific work instructions for workers. Workers would only be involved with carrying out one of the many steps in the production process. Not only in industry, but also in administrative settings, such as government organizations, the concept of division of labor became the most dominant form of organizing work
A side effect of the ideas of Taylor and his contemporaries was the emergence of an altogether new class of professionals
Managers
Managers are not necessarily experts in carrying out the job they oversee
Their main interest is to optimize how a job is done with the resources under their supervision
These units are overseen by managers with different responsibilities. Moreover, the units and their managers are structured hierarchically. Example: groups are placed under departments, departments are placed under business units, etc.
Functional units, in which people with a similar focus on part of the production process are grouped together
Emerged from the mindset of the Second Industrial Revolution and dominated the corporate landscape for the greatest part of the 19th and 20th centuries
Functional organizations
The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed
Business process re-engineering (BPR)
A key element is that a problematic situation (i.e., an excessive amount of time and resources spent on checking documents in accounts payable) is approached by considering an entire process
Urging managers to look at entire, end-to-end processes when trying to improve the operations of their business, instead of looking at one particular task or business function
A manager that is responsible for a business process and is concerned with planning and organizing the process on one hand and monitoring the process on the other
Process owner
Set goals and exceptions, establish plans and budget, provide resources and staff, implement process
Plan and organize process
Monitor process, reinforce success, diagnose deviations, take corrective actions
Monitor and control process
While both BPR and BPM approaches take the business process as a starting point, BPR is primarily concerned with planning and organizing the process
By contrast, BPM provides concepts, methods, techniques, and tools that cover all aspects of managing a process (to plan, organize, and monitor it) as well as its actual execution
BPR should be seen as
A subset of techniques that can be used in the context of BPM
The first question that a team embarking on a BPM initiative needs to clarify
Which business processes do we aim to improve?
If the organization has engaged in BPM initiatives before, it is likely that an inventory of business processes is available and that the scope of these processes has been defined, at least to some extent
Process thinking
In organizations that have not engaged in BPM before, the BPM team has to start by at least identifying the processes that are relevant to the problem on the table, delimiting the scope of these processes, and identifying relations between these processes
Process identification phase
A collection of inter-linked processes covering the bulk of the work that an organization performs in order to achieve its mission in a sustainable manner
Process architecture
The purpose of engaging in a BPM initiative is
To ensure that the business processes covered by the BPM initiative lead to consistently positive outcomes and deliver maximum value to an organization in servicing its clients
Measuring the value delivered by a process is a crucial step in BPM
As renowned software engineer Tom DeMarco once famously put it: “You can’t control what you can’t measure”
Before starting to analyze any process in detail, it is important to clearly define
The process performance measures (also called process performance metrics) that will be used to determine whether a process is in good shape or in bad shape
Typical process performance measures relate to
Cost
Time
Quality
Flexibility
The percentage of times that an execution of the process ends up in a negative outcome
Error rate
Capture the extent to which the performance of a process is maintained under changing or abnormal conditions. Example: when a works engineer resigns suddenly or when a supplier goes bankrupt
Flexibility measures
The identification of performance measures (and associated performance objectives) is crucial in
Any BPM initiative
Typically, one of the outcomes of this phase is one or several as-is process models. These as-is process models reflect the understanding that people in the organization have about how work is done
Process discovery phase
Process models are meant to facilitate communication between stakeholders involved in a BPM initiative
Therefore, they have to be easy to understand
In principle, we could model a business process by means of textual descriptions. However, such textual descriptions are cumbersome to read and easy to misinterpret because of the ambiguity inherent in free-form text
This is why it is common practice to use diagrams in order to model business processes
Consist of rectangles, which represent activities, and diamonds, which represent points in the process where a decision is made
Flowcharts
Basic types of nodes
Activity nodes
Control nodes
Event nodes
Describe units of work that may be performed by humans or software applications, or a combination thereof
Activity nodes
Capture the flow of execution between activities
Control nodes
Tells us that something may or must happen, within the process or in the environment of the process, that requires a reaction
Event nodes
Here, the flowchart is divided into so-called swimlanes, which denote different organizational units (e.g., different departments in a company)
Cross-organizational flowchart
Widely-used standard for process modeling
Business process model and notation (BPMN)
Activities are represented as
Rounded rectangles
Control nodes (called gateways) are represented using
Diamond shapes
Activities and control nodes are connected by means of
Arcs (called sequence flows) that determine the order in which the process is executed
Each of the process participants is shown in
A separate lane, which contains the activities performed by the participant in question
The identification and assessment of issues and opportunities for process improvement
Process analysis phase
When one or several tasks are repeated because something went wrong
Rework
Sometimes, a negative outcome might stem from miscommunication, for example between the site engineer and the clerk. On other occasions, it might come from inaccurate data (e.g., errors in the description of the equipment) or from an error on the supplier’s side
By identifying, classifying, and understanding the main causes of such negative outcomes, the analyst can ultimately find ways of eliminating or minimizing them
Assessing the issues of a process often goes hand-in-hand with
Measuring the current state of the process with respect to certain performance measures
Armed with an understanding of the issues in a process and a candidate set of potential remedies, analysts can propose a redesigned version of the process. This to-be process design is the main output of
Process redesign phase
It is important to keep in mind that analysis and redesign are intricately related
There may be multiple redesign options. Each of these options needs to be analyzed, so that an informed choice can be made as to which option is preferable
Once redesigned, the necessary changes in the ways of working and the IT systems of the organization should be implemented so that the to-be process can eventually be put into execution
Process implementation phase
Process implementation involves two complementary facets
Organizational change management
Process automation
Refers to the set of activities required to change the way of working of all participants involved in the process
Organizational change management
Involves the configuration or implementation of an IT system to support the to-be process
Process automation
Organizational change management includes
Explaining the changes to the process participants (to the point that they understand both what changes are being introduced and why these changes are beneficial to the company)
Putting in place a change management plan so that stakeholders know when the changes will come into effect and what transitional arrangements will be employed to address problems during the transition to the to-be process
Training users to the new way of working and monitoring the changes in order to ensure a smooth transition to the to-be process
The IT system (in process automation) should support process participants in the performance of the tasks of the process. This may include
Assigning tasks to process participants, helping process participants to prioritize their work, providing process participants with the information they need to perform a task, and performing automated cross-checks and other automated tasks where possible
Over time, adjustments may be required in the implemented business process when it does not meet expectations any longer
To this end, the process needs to be monitored
Analysts ought to scrutinize the data collected by monitoring the process in order to identify adjustments
Process monitoring phase
Lack of continuous monitoring and improvement of a process leads to
Degradation
As Hammer once put it: every good process eventually becomes a bad process”, unless continuously adapted and improved to keep up with the ever-changing landscape of customer needs, technology and competition
This is why the BPM lifecycle should be seen as circular: the output of the monitoring phase feeds back into the discovery, analysis, and redesign phases
