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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

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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

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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.

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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.

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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

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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

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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

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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

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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

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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

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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

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usethatmodelconsistently,orthattheyunderstandthatvariousmodelsareinuseandadjustaccordingly.

The CBOK®

Future versions

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

Werecognizethat,regardlessofthestepswehaveputinplacetodeliveraqualityproduct,theremaybetopicsthatmemberswouldlikeaddedandpointsthatmightbemorefullydiscussed.ThegoalistoprovideafoundationorframeworkfortheBPMindustryandhelpourmembersandotherreadersobtainacomprehensiveperspectiveofthetopicsandissuesthattheymustdealwithtodeliverimprovementandtransformation.

ReaderswhowouldliketoseeadditionaltopicsordiscussionsinfutureversionsareinvitedtosendallsuggestionsorrecommendationsforchangestoABPMPatEdcomm@abpmp.org

Comments

PleasesendcommentstoABPMPthroughourwebsite,andletusknowifthereareanytopicsyoubelieveweshouldincludeorifyouhavedisagreementswiththeassociation’spointofview.Yourcommentswillbeusedasafoundationforfutureversions.

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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

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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

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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

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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.

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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

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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.

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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/

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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

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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

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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

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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

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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

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Chapter 1

Guide to the CBOK®

Chapter1.GuidetotheCBOK®

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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

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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

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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.

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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

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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.

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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.

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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

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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.

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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.

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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.

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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.

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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”

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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.

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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

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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!

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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

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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

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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.

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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

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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,

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Thecustomersofatiremanufacturerarecarmanufacturersandpeoplewhodrivecars.

Thecustomersofafinancialservicesproviderareindividualsandbusinessentitieswhosaveandinvestmoney.

Figure4.

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

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

Inanotherexample,theInformationSystemsorganizationwithinaPharmaceuticalcompanyprovidesservicestotheotherlinesofbusiness.EachoftheseservicesisdeliveredtothelinesofbusinessthroughbusinessprocessesexecutedbyInformationTechnology.ThisServiceProvider/Customerrelationshipisillustratedbelow.

Figure5

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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.

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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.

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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

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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.

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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.

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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.

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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

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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:

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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.

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answerthequestion“Arewedoingthingsright?”Thesemeasuresareputinplacetomonitorprocessperformancewithrespecttotimeandcost.

Figure13.

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

Ifalloperationaltargetsaremetthenfunctionaltargetsaresatisfied Ifallfunctionaltargetsaremetthenhighestlevelprocessperformancetargets

aresatisfied Ifallprocessperformancetargetsaresatisfiedthensoisthecustomer.

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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:

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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

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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).

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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

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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.

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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

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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.

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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

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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

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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.

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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

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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

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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

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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:

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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.

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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

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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

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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

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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

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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

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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

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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

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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.

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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

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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.

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Chapter 3

Process Modeling

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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

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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.

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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

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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

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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.

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3.1.1.3 Static vs. Dynamic Models

Using static models

Staticmodelsrepresentasinglestateofabusinessprocessorcertainelementsofabusinessprocess.Staticrepresentations

Establishbaselines Documentconfigurationstages Depictcertainfuturestatesbasedonassumptionsofgoalsorrisksofthe

process Managechange

Table3

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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.

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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.

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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

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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.

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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.

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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

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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.

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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.

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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.

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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

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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.

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Example

Figure30.EventProcessChain(1)

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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

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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

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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.

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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

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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.

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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

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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

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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

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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/

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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

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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.

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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

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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.

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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.

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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.

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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

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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.

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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.

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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

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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

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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.

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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,

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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.

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Process Analysis

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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.

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

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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

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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

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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).

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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.

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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.

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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

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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

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4.5 Preparing to Analyze Process

Processpractitionerswhohavebeeninvolvedintheredesignoflarge‐scaleprocessesknowthatdrillingdowninsideasingleprocessusuallydoesn’tprovidetherightlevelofunderstanding.Evaluatingtheactivitiesandworkflowwithinonlyasingleprocessmaynotprovideanadequatebasisforimprovingtheprocess.Oneneedstoconsiderhowchangetoasingleprocessimpactsotherrelatedprocessesin

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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

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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.

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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?

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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?

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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?

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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?

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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:

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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.

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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:

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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

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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.

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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.

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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.

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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,

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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.

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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

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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

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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

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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.

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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

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

Processmethodologiesandframeworksensuretheprocessanalysisfollowsacommonlyacceptedpathtoachievebestresults.Processanalysiscanfollowformalanalyticalmethodologiesorapragmaticreviewofthestandardsforbestpracticeexecution.

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

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Process Design

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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

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createacompleteprocess.Weseethisapproachaugmentingadaptivecasemanagement,whereaprocessorportionoftheprocessisquiteunstructuredexceptforthedesiredmilestonesandoutcomes.

Therearemultiplewaysofaccomplishingprocessdesign.Itisimperativetounderstandwhatwaysworkinyourcultureandsituation.

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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

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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

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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.

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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.

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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

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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

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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

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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.

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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.

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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

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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.

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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.

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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

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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.

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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

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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

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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

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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

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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.

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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.

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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

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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

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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.

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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

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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.

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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‐

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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

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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

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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.

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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

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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

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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

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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

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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

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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.

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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?

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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.

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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.

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Chapter 6

Process Performance Management

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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,

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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.

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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

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areBAM‐drivenorjustold‐fashionedMBWA(managementbywalkingaround),doyourbesttodefineprocesses,metrics,andmeasuresthatareproperlyscoped,basedontherealvaluebeingdelivered,anddesignedfromtheproperperspectiveoftherealstakeholders.Todoanythinglessisjustaskingtobelabeledasirrelevanttoprocessperformancemanagement.

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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

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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

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6.0 Introduction

ProcessPerformanceManagementinvolvesbothanunderstandingofwhattomeasureandhowtomeasureit.Thischapteristhusdividedintotwobasicsections—whattomeasureand(basically)howtomeasureperformance.

Performancemeasurementisthefoundationforperformancemanagement,andiftheorganizationdoesnothavetheperformancemanagementmaturitytosupportoften‐complexperformancemeasurement,theresultsofthemeasurementcanbemisinterpretedandcauseharminsteadofgood.

ThischapterthusdevotesconsiderablespaceinSection1todiscussingperformancemanagementmaturityinordertohelpcompanymanagersunderstandwheretheircompanystandsintermsofitsabilitytosupportperformancemonitoringandmeasurementandtointerprettheoutcomeofmeasurementactivity.

Thesecondsectionofthechapterismoremathematicalandmoreconcernedwithhowyoumeasureperformance.Successfulperformancemanagementrequiresamasteryofbothaspectsofthisissueandthedesignofanevolving,customizedapproachtodeterminingthecompany’strueperformanceasrelatedtoindividualprocesses.

Thisfocusonprocesswillbenewtomany,sincetheusualfocusisonfinancialorbusinessunitmeasures.Whilethesearecertainlyvalid,weareproposingadifferentgroupofmeasures—relatedtoprocess.Theseprovideacomprehensiveunderstandingofhowtheoverallprocessisperformingandhelpfocusprocessoptimization.

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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:

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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.

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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.

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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

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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

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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

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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

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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

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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

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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

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(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.

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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.

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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.).

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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.

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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

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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

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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

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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,

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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

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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:

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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.

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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

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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,”

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“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.

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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

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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

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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.

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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.

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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.

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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:

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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.

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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

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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.

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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.

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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

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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.

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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.

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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.

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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

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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.

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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

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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.

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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

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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

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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

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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

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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

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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,

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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)

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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

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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

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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:

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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

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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

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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.

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Chapter 7

Process Transformation

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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.

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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.

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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

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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

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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.

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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.

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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

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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

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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).

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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.

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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

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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

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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

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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

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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‐

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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

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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.

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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

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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

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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),

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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

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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

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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

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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.

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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.

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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

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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.

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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.

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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.

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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

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thebusinessandmanagenotonlyhowallwillchange,butalsotherippleofanyparticularchange.

Figure56

Therippleandtrackingitareespeciallyimportantinanyprojectthataddressesonlypartofaprocess.Heretheteammustconsidertheimpactonprocess,people,andtechnologyworkdownstreamandthemanycomponentsthatdefinethebusinessoperationandhowtheoverallprocesswillbeaffected.

Tryingtoattendtoallofthesefactorsorcomponentsisoverwhelming.InourexperiencewithBPM,thekeyareastofocusonwhenitcomestimetoaligningthedifferentcomponentsofachangearethefollowing:

Key:Ex:Executives,S:Strategy,BI:BusinessIntelligence

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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

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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

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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

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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

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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

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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.

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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

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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

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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.

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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

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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

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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

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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

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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

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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.

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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.

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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

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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

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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

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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.

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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.

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Process Organization

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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‐

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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.

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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

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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

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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.

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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

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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)

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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

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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

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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

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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

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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.

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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

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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

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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.

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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,

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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.

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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

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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.

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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,

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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

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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.

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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.

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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.

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Enterprise Process Management

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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.

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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,

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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.

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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

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9.7.2 RoleofITinProcessManagement......................................................................363

9.7.3 EnterpriseorBusinessArchitectureandProcessManagement...........364

9.7.4 ContinuousorQualityImprovementinitiatives...........................................364

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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

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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.

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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

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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

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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

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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.

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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.

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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.

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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.

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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

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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

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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,

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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

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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.

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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

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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

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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.

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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:

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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.

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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

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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

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Managersmustbeabletoupdateandusetheinformationquickly.Ifthisisnotavailable,theeffortwillslowandbecomeoverhead.

Interestingly,assoonasanythingbecomesoverheaditisdeemedunnecessaryanddropped.

ItisthusimportantthatanymovetoaprocessperspectiveandProcessManagementbethoughtoutandsupportedbyexecutivemanagementthroughbudgetandmandate.Itshouldalsoberecognizedthatamovetothisapproachcannotoccurquicklyorwithoutconsiderablework.Evenwiththissupport,anymovetoimplementacontinuousimprovementprogrammustprovideanabilitytochangequickly—veryquickly.Thereasonisthatthebusinesswillchangecontinuouslyandanychangethattakesalongtimewilldeliverasolutionthatmeetstheoldneedsoftheoperation,notthenewneeds.So,speedofchangeiscritical.

ThiscanbeprovidedthroughtheBPMSanditsabilitytoquicklymodelanditerate.Withthiscapability,changesinaprocessoratalowerworkflowlevelcanbemodeled,simulated,tested,anddeployedindaysorweeks,insteadofmonths.Thisalsoallowsmanagementtotracktheoutcomeofchangesandmakecertainthattheoperationisimproving.

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BPM Technology

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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.

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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

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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

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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.

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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

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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

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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

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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.

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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

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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.

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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.

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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.

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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.

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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

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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

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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

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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

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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

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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.

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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

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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,

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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

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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

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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

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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.

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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

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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

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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.

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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

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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).

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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.

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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

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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:

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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.

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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,

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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

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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.

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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.

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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

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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.

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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

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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.

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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

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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

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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

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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.

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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

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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

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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

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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

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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.

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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.

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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

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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.

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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

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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.

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ThepurposeoftheCBOKGlossaryistodefinetermsforbusinessprofessionals.ThedefinitionsarethusnottechnicalinnaturebutreflectplainbusinessEnglish.Tohelpreduceconfusionandpromoteunderstanding,sometermshavedescriptiveinformationalongwiththedefinition.

ABPMPrecognizesthatanyterminBPMorBPMStodayisopentointerpretationbecausepeopleapplydefinitionsusedwherevertheylearnedtheterm.Consequently,mosttermshavecompetingdefinitions,andthiscomplicatescommunicationincompaniesandamongBPMprofessionals.Increatingthisglossary,wehadtodecidewhethertolistnumerouscompetingdefinitionsortoprovideastandarddefinitionforeachterm.OurgoalwastocreateconsistencyinBPMdiscussionsfortheBPMindustryandourmembers,sowehaveprovidedasinglestandarddefinitionforallterms.ThisglossaryisthusastepinachievingtheABPMPgoalofcreatingastandardunderstandingofBPMthroughouttheworld.

Althoughthesedefinitionsmaybesomewhatdifferentfromthoseyoucurrentlyuse,theyaretheABPMPstandarddefinitionsandareusedthroughouttheCBOK.

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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

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1990s.ARISusesamodelinglanguageknownasEventDrivenProcessChain(EPC),whichbringsmultipleaspectsofenterprisemodelingtogetherusingtheARISHouseofBusinessEngineeringframework.

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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.

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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.

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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.

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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.

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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

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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).

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Data Flow Analysis Ananalysistechniquethatseekstounderstandhowdataflowsthroughasystem.Itlooksatdatauseindifferentpartsofanorganizationaswellashowdataisusedbyapplicationssupportingagivenbusinessprocess.

DCORTM DesignChainOperationsReference:areferencemodelcreatedbytheSupplyChainCouncil.

Dynamic Business Applications Applicationsthatcanquicklyadapttochangingbusinessneeds,competitivepressure,andmarketopportunity.

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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

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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.

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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.

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BPM Governance BPMGovernanceorchestratestheprocessofprocessmanagementandprovidesasustainablecontinuousprocessimprovementcapability,whichisalignedwiththebusinessstrategy.

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Handoffs Anypointinaprocesswhereworkorinformationpassesfromonesystem,person,orgrouptoanotherisa“handoff”forthatprocess.Handoffsareoftenillustratedasprocessinterfacesorintermediaryevents.

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Integrated Definition Language (IDEF) AFederalInformationProcessingStandardthathighlightstheinputs,outputs,mechanisms,andcontrolsofaprocess,andclearlylinksprocessesupanddownlevelsofdetail;IDEFisagoodstartingplaceforanenterprise‐wideviewofanorganization.

ITIL ITILstandsforInformationTechnologyInfrastructureLibrary.ItisacollectionofbestpracticesforInformationTechnology(IT)servicemanagement.

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Key Performance Indicator (KPI) KPIreferstothemetricsormeasuresofaprocessthatareindicativeofoverallperformance.

Companiesthatmeasureperformanceshouldhavesettargetsandstandardsformeasuringperformanceonthosethingstheyconsidertobereallyimportant.ThesemeasuresarecalledKeyPerformanceIndicators(KPIs).KPI’smeasurefactorsthatmanagementbelievesareanindicationofoperationalexcellence.Tobearealisticindicator,eachKPIshouldbebasedonareasonabletargetandshouldchangeovertimeasthebusinessimproves.

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Lean Aphilosophyandapproachthatstressestheeliminationofwasteornon‐value‐addworkthroughafocusoncontinuousimprovementtostreamlinetheoperations.Itiscustomer‐centricandstressestheconceptofeliminatinganyactivitythatfailstoaddvaluetothecreationordeliveryofaproductorservice.Leanisfocusedonprovidinghigherquality,reducedcycletime,andlowercosts.Becauseitproduces

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improvedproductionsystems,itisbelievedtoincreaseproductioncapabilityandflexibility.Butinpractice,itsconceptscanbe,andhavebeen,appliedinallareasofabusiness.JamesWomackandDanielJonesdevelopedtheterm“Lean”intheirbookabouttheToyotaProductionSystem(TPS),THEMACHINETHATCHANGEDTHEWORLD.Today,Leanissupportedbytoolsandstatisticalmethodsthat,althoughnotasrobustasthoseofSixSigma,areanimportantpartofimprovementprojects.ForthemostpartLeanhasbeenusedinmanufacturing,whereorganizationsareapplyingLeantoolsinserviceandtransactionalsettingswithgreatsuccess.Typicalresultsshowdramaticreductionsintimewhilesignificantlyboostingquality.ThisapproachissometimescombinedwithSixSigmatechniquesandreferredtoasLean/SixSigma(L‐SS).

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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.

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Notation Thespecificsetofsymbolsandtheirrulesofusageindescribingathing.TherearenotationscreatedoradaptedforuseinBPM,justasinotherfields.Flowchartingisanexampleofanotationusedbothforbusinessprocessdocumentationandfordocumentingcomputer‐programminglogic.OtherexamplesincludeBPMNandEPC.

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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.

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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

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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.

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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

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Processmanager, Processanalyst, Processdesigner,and Processarchitect,alongwith Businessanalyst, Subjectmatterexpert,and Executivemanagementandleadership

ProcessteamsareoftenadvisedbyaBusinessArchitectand/orProcessArchitect.

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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

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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

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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.

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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

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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

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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.

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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.

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ThankyouforsupportingtheAssociationofBusinessProcessManagementProfessionals(ABPMP).Ourgoalistoconstantlyimprovethediscussiontheauthorspresentedinthisbook.PleasesendcommentsandsuggestionstoABPMPathttp://www.abpmp.org/.

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