1bf4aLecture 1 - Use

8/3/2019 1bf4aLecture 1 - Use

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2006 Prentice Hall, Inc. 5 1

1

Amity Business School

Business Process Optimization

Module 1


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Business Process

A business process:

1. Has a Goal

2. Has specific inputs

3. Has specific outputs

4. Uses resources

5. Has a number of activities that are performed in some order6. May affect more than one organizational unit. Horizontal organizational impact

7. Creates value of some kind for the customer. The customer may be internal orexternal.


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Business Process

A business process is a collection of activitiesdesigned to produce a specific output for a particular

customer or market. It implies a strong emphasis onhow the work is done within an organization, incontrast to a product's focus on what. A process isthus a specific ordering of work activities across time

and place, with a beginning, an end, and clearlydefined inputs and outputs: a structure for action.


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What is Business Process ?

Its everything we do!!

Is triggered by an external business event.

Is comprised of all the activities necessary to provide the appropriate business outcomes in

response to the triggering business events.

Transforms inputs of all types into outputs, according to guidance (policies, standards,

procedures, rules etc.) employing reusable resources of all types.

Contains activities which usually cross functions and often organizational units.

Has performance indicators for which measurable objectives can be set and actual

performance evaluated.

Delivers a product or service to an external stakeholder or another internal process.

Usually connects to other processes.

Its HOW we do what we do!


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Business Process Breakdown

Take

Order

Prepare

Order

Schedule

Delivery

Deliver

Order

Close

Transaction

Serve

CustomerGreet

Custome

r

WHAT

WHAT

HOW

WHO

Workflow

Provide

Take-out/DeliveryService

Server Server Chief

& Staff

Server Driver

Core Business

Process

Sub-Process

(Activity)

Activity

(cross-functional)

Task/Steps

(specifically related

to an individual

RecipeGet utensils ready

Preheat oven

Combine ingredients.

Place in cooking dish,

place in oven...


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Cross-functional business activities

Place Order

Take Order

Receive

Order

Deliver

Order

Schedule

Delivery

Prepare

food

Customer

Customer

Service

Credit

Logistics

Food

Preparation

Delivery




Types of Business Processes

CORE business processes are linked directly toexternal customers and their values.

CORE business processes meet marketplace

demands on a day to day basis.

CORE business processes guide, control, plan,

enable or provide resources to the CORE and otherSUPPORT business processes.




Why Business Process Management

Enterprises are seeking to transformthemselves into customer-focused, process-centric organizations and consider this

transformation critical to their businesssuccess.

A key part of that transformation is to

reorganize information resources assubstantially independent reusableservices.




BPM goals are to efficiently align theorganization with the customers wants andneeds

BPM attempts to continuously improveprocessesseeking process optimization by

Defining

Measuring

Improving your process




People

Customer facing staff are best suited to understandcustomer needs and must be empowered to makeimprovements.

Many improvements can be done without involvingtechnology

BusinessTechnology Divide

Business processes are managed by business people.

Information moves between software packages




Bridging IT and Business Bringing the power of technology to business staff andreducing their work should be the BPM group credo.

BPM is the bridge between Business and IT.

BPM systems will develop to be industry specific.

A cyclical BPM life-cycle exists:

Design

Modeling

Execution

Monitoring

Optimization




BPM Vs Workflow

Whats the Difference?




BPM: characterizes a series of activities independent from specificapplications.

BPM is a superset of workflow

It is distinguished by its ability to coordinate activities and tasks amongusers

BPM connects disparate systems enabling seamless data sharing anduniversal control from a single interface

Business processes, once defined, are modeled, automated, managed andoptimized to be effective, cost efficient and achieve high operational

performance It is used to capture, evaluate and analyze information from outside

sources efficiently and effectively

With the ability to distinguish between execution rules and the actualflow of the process, BPM rules allow you to govern your processes

A i i S h l




Workflow: facilitates simple routing of tasks or activitiesfrom person to person.

Workflow Automation uses application-specific sequencingof tasks established with predefined rules, including eitherautomated or manual activities

The ability to integrate between workflow-specific systemsand other external systems is often limited, only allowingdocument and data retrieval

Workflow Software is very basic in its ability to analyze andreport on content analysis

The process flow is fixed, meaning cannot adapt to orprovide for multiple possible paths to the same goal

A i B i S h l




Whats in Common?...

The need to automate core processes toeliminate bottlenecks, cut out redundancies,and achieve operational efficiency.

A i B i S h l




Work Flow Automation

Benefits of Workflow Automation Workflow Software is a simple automation tool for directing

documents and tasks to the responsible users in a businessprocess for further actions. It provides information andsupport for each step of the process and business cycle.

Materials and documents pertaining to the process mayeither be physically transferred from one user to the next, or

they may be maintained in a database or server with accessgiven to the appropriate users at the appropriate time. In thissystem alarms and triggers can also be set to alert executivesand process owners when the tasks are overdue. This

automated system of operations ensures that work is movedthrough the system in a timely fashion and is processedcorrectly by the appropriate users.

A it B i S h l


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Mapping out your companys business processes is no smallfeat, as process discovery can be a huge project in itself.

Workflow automation, the next step in improving youroperational performance, delivers many key benefits to yourcompany including:

Online data capturing through web forms

Eliminating human error (often part of manual process

execution) Automatic task escalation

Visibility into the process

A it B i S h l


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Workflow Automationis not the end-all in

your Business ProcessInitiative (BPI); rather

it is just one piece of thepuzzle.

Amit B i S h l


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Taking Workflow to the Next Level

Workflow applications only provide the ability to automate and manage

processes, while a BPMS provides for all four phases: Modeling,Automating, Managing, and Optimizing. The goal of each of thesephases is to control the costs of executing the business process, reducethe time spent by process participants to execute their process tasks, andalso improve visibility into the process itself. If you are utilizing just aworkflow application, then you are taking a blind leap of faith, in thatyou have no way to analyze, test, and model your new business processbefore it is made live. Dont stop short with your workflow - BPM can

take it to a whole new level in several ways:



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From a technical perspective a Business Process Management Suite (BPMS) includes seamlesscode-free integrations with existing systems, business rules, recipients, business data, formsand templates.

A true BPM Suite not only provides routing engine capabilities, but also provides vital fullprocess life-cycle functions including:

1. Process Modeling- simulates a process PRIOR to automation

2. Integrated Business Rules Enginebusiness process rules can be created and updatedseparate from the underlying business processes

3. Out-of-the Box Forms Designer- allows for easy to build forms to emulate your currentoffline document

4. Process Simulationallows you to test your business processes in the same way yourend users will use the processes

5. Patented Process Optimization Methodologies (Adaptive Discovery)- supports Lean Six

Sigma 6. Business Activity Monitoring and Reporting- visibility is a must for any process

Coupling your Workflow Automation initiatives with BPM Software can give your companya more robust, complete tool set to leverage the full benefits of process automation.



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Process Design Identify existing processes

Design the to-be processes

Key Terms Representations of process flow

Actors within a process

Alerts & Notifications

Escalations

Standard Operating Procedures

Service Level Agreements

Task hand-over mechanisms



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Modeling

Starting with the Design (theoretical) introducevariablessuch as cost of materials, introduction

of more people, etc. to determine how theprocesses might operate differently.

What if analysis

What if only 90% of the people had to do the work?

What if only 50% were available (baby-boomersretiring)



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Monitoring Individual process tracking (state and statistics)

State of a customer order, state of a delivery, how many deliveredon-time, right-quantity, right-place, etc.

Identify problems and correct

Work with customersonce the problem is identified, fix theconnectivity issues (information rollups, data exchange, peoplecommunications, etc.)

Measures: Cycle time, defect rate, productivity

Business Activity Monitoring (BAM)

Realtime or Ad-hoc

Process Mining

Compare event logs with a-priori model to analyze bottlenecks,breakdowns in process, etc.



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Optimizing

Identifying process failures, bottlenecks, underperformance issues

Cause-effect analysis Redesign or modification of process to

Reduce Cost

Improve Quality

Increase Responsiveness



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Business Process Reengineering (BPR) focuses onthe analysis and design of processes within anorganization.

Business Process Intelligence (BPI) focuses on

providing real-time monitoring of businessprocesses and activities as they are executed withincomputer systems, and in assisting in optimizingthese activities and processes by identifying anddetecting situations that correspond to interruptionsand bottlenecks.

Business Process Improvement (BPI) focuses on theoptimisation of processes.



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BPO

planning, designing, measuring and managing ofan organisation's business processes in order tomaximise the effectiveness and profitablility of thewhole business system.

This is a shift from cost-led pricing to pricing-ledcosting.

Peter DruckerManagement Challenges of the 21stCentury.

This change is from forecast-driven inventorystyle systems to responsive, flexible and demand-driven mass customization, globally.



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Business Process Optimisation

Business Process Optimization involves optimizing processflows of all sizes, crossing any application, companyboundary and connects process design and processmaintenance.

The Business Process Optimization aims to change aBusiness Process to reach a higher Quality Of ServiceLevel for a specific service composition.

The Business Process Optimization aims to change aBusiness Process to reach a higher Quality Of ServiceLevel on a specific service infrastructure.

A Business Process Optimization aims to adapt the businessprocess needs (in terms of calculation power, bandwith,memory, etc.) for it to run properly on a specific serviceexecution platform.



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What is Business Analysis? Business analysisis the discipline of identifying business needsand determining solutions to business

problems. Solutions often include a systemsdevelopment component, but may also consistof process improvement or organizationalchange or strategic planning and policy

development. The person who carries out thistask is called a business analyst or BA. -



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Business Analysis

Business Analysis is the set of tasks, knowledge andtechniques required to identify business needs anddetermine solutions to business problems.

Solutions often include a systems developmentcomponent, but may also consist of processimprovement or organizational change.

International Institute of Business AnalysisBody of Knowledge (BABOK)



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A Business Analyst works as aliaison among stakeholders in

order to elicit, analyze,

communicate, and validaterequirements for changes tobusiness processes, policies, and

information systems.



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Business Analysis

Business Analysis is the set of tasks, knowledge andtechniques required to identify business needs anddetermine solutions to business problems.

Solutions often include a systems developmentcomponent, but may also consist of processimprovement or organizational change.

International Institute of Business AnalysisBody of Knowledge (BABOK)



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