bpm standards and technology understanding tool options, identifying technical requirements,...

BPM Standards and Technology

Understanding tool options, identifying technical requirements, establishing selection approach, and making the final choice

BPM Standards

BPM standards are used by business managers to help them analyze and organize enterprise BPM initiatives

Most BPM standards to date are focused on IT: more standards are needed in areas other than IT

Benefits of using standards:

Simplifies the work

Reduces amount of decision-making required

Ensures consistency of information among regions and groups in the organization

Enables consistency of information between organizations, improving the ability to integrate across the supply chain

BA 553: Business Process Management 2

Examples of Commonly Used BPM Standards

Kaplan and Norton’s Balanced Scorecard (BSC) and all related spin offs/ modifications (session 3)

Framework used to document, categorize and align financial and non-financial enterprise performance metrics with strategy and process initiatives

Supply Chain Council’s SCOR framework (and the DCOR/CCOR variations, collectively known as SCOR+)

Used to document and evaluate multi-company supply chain processes, including benchmarking assessments

VRM and eTOM are similar to SCOR+ (eTOM is specifically designed for the telecom industry)

EFQM (European version of the US Malcolm Baldrige Award) Used for overall assessment of organizational quality, not just a BPM tool

SEI’s CMMI (covered in session 11)

FEAF: used by the US government, usually (but not always) as an IT standard


Our Dependence on Technology

It’s important to understand that technology is just an enabler of the work – it can’t replace the work

We must be able to judge when the technology is useful and when it is taking priority over everything else



Integrating Processes With Other Information

As the enterprise builds maturity in its BPM efforts, the process documentation can be integrated with other information in the organization

There are three types of software tools that were designed to assist in this integration:

Business process modeling tools

Workflow tools

Enterprise application integration tools

Business Process Modeling Tools

Process modeling tools have been around for a long time

Their purpose is to help users document a process

They are also useful in analyzing processes, and proposing new or redesigned processes

The more sophisticated tools store the process diagrams in a repository

They also store additional information besides the steps, such as which roles are performing the work, and even key metrics associated with the process or process step

Some of the more powerful tools even enable simulation of process changes (although this usually requires a large investment of time and effort, so must be used selectively)


Workflow and Document Management Tools

Most flowcharting tools enable the use of hyperlinks

If a given process step involves working on a document, that step in the flowchart could include a hyperlink to the document’s location in a company database

A workflow tool will automatically notify the next person in line who needs to work on or approve the document

These features are even available in SharePoint and eRoom collaboration tools

Another advantage for processes that are done primarily on the computer is that they can include the capture of metrics (e.g., number of items completed, or process cycle time) – this is referred to as Business Activity Monitoring (BAM)

Workflow solutions had some of these capabilities, but many have been replaced by the more sophisticated and flexible BPM suites


Enterprise Application Integration (EAI) Tools

An organization’s departments traditionally kept information in different applications, which were sometimes tailored to the specific purposes of that departmental manager

This made integrating the departmental information, such as financials or inventory information, difficult if not impossible

Enterprise application integration tools were new applications developed to help manage the information from multiple applications

By this method, EAI tools appeared to provide a single integrated source of information, but in fact they simulated a single source: original inputs were still made in the individual applications, and the information was moved by the EAI tool


Integrating Process Management Software

All of these solutions lacked one critical factor: a common infrastructure by which processes and process information were managed

The internet, and the related standards that have been developed, made it possible to interface with and integrate multiple applications

This led to efforts to integrate the three types of software mentioned previously: business process modeling, workflow, and EAI

The tool that was developed to integrate these is called a BPM Suite (BPMS)


BPM Suites

A BPM Suite is a tool that is used to develop a BPM software application

The BPM application is established by creating a process flow diagram or business rules – changes to the process are made by changing the flow diagram or business rules

The process flow diagram describes all possible options or paths for a particular process in the organization

The BPM application also includes a BPMS engine that executes the process

When the BPM application executes the process for a particular situation, it follows only one path through the process depending on the selections of the people interacting with the application

The actual application used to work on the documents, and the documents themselves, are kept separate from the BPM Suite



BPM Technology Selection

The critical issue related to BPM technology selection is an understanding of how to make the selection:

How to identify selection criteria

How to use this to make a final selection

How to present the selection and its justification to management


Steps in Selecting BPM Technology

Establish a technology selection team, comprised of process owners, BPM COP and COE members, steering committee members, and IT personnel

Identify current and future needs to be fulfilled by the software package

Develop a specification for the technology

Describe each item in the specification as a product feature

Develop weightings for each feature (how important are they?)

Identify potential technology packages to include in the selection process

Modify the features and weightings based upon new information

Have technology selection team members each rate potential technology packages against the features, on a scale (say 1-10)

Multiply the average ratings by the chosen weightings for each feature

Add up the scores and identify the recommended choice

Document the reasons for the selection and provide them to management, including any additional pros and cons of the selected package


Potential Selection Criteria for BPM Software

Integration with other BPM components (e.g., a BPM suite) Ease of use Performance (speed, quality, etc.) Cost of purchase / licensing Cost of ongoing maintenance contract Ability to modify or tailor software in-house Integration with current enterprise software (e.g., ERP system) Ability to import existing documents from (and export to) other applications Quality of support, and ability to support multiple users Scalability (ability to increase user base without overloading) Reputation of the vendor Availability and quality of customer references Historical improvement of technology by the vendor

“Business Process Analysis Tool Selection Criteria,” Gartner research white paper, 7 November 2005.

BPM Technology Selection Example

Feature Pkg 1 Pkg 2 Pkg 3 Pkg 4

Ease of use: an average person can use it – don’t have to be a programmer

Performance (speed, quality, etc.)

Integration with current enterprise software (e.g., ERP system)

Integration with other BPM components (e.g., a BPM suite)

Ability to import and export information in other formats (Word, Excel, pdf) for analysis and reporting purposes

Scalability (ability to increase user base without overloading)

Cost of original purchase and licensing, plus maintenance

Quality of technical support from supplier

Ability to modify or tailor software in-house

Historical improvement of technology by the vendor

Ownership management and workflow management (e.g., automatic email notification to owners and users when changes occur to their processes, or when approvals are needed)

Process repository offered with modeling software to store and retrieve info

Ability to maintain detailed document history with metadata

Automatic change log generated

Automatic revision control

TOTAL SCORE


Example from a project I worked on:

Business Activity Monitoring (BAM)

In previous sessions, we discussed the difficulty of identifying metrics that will measure what’s important rather than what’s easy to measure

We also discussed how collecting the wrong metrics can result in behaviors that are the opposite of what’s desired

Measuring and monitoring measurement results is referred to as business activity monitoring

Most BPM Suites offer a limited capability in this regard, such as collecting information on specific process steps

However, a BPM Suite can’t collect cycle times for the full process lifecycle, if some of the process steps are conducted offline

In order to get the type of information useful to executives, data must be collected from multiple sources, and then analyzed: this often involves the use of BI (business intelligence) applications

The information is usually collected into an executive dashboard: one location which provides a snapshot of how things are doing



Example Executive Process Dashboard

www.dashboardinsight.com/dashboards/screenshots/altosoft-asset-management-dashboard.aspx , accessed 3 March 2010.

Additional Tools Related to BPM

ERP (covered next)

SOA (all remaining tools covered in session 13)

SaaS

Cloud computing

Social media and collaboration tools

Web 2.0 and Enterprise 2.0


Additional Tools Related to BPM: ERP

Enterprise Resource Planning (ERP) applications are intended to collect and integrate business information to assist in business planning throughout the organization

Most of the large organizations are using some brand of ERP software to manage their activities

As with any software that helps with business planning, ERP software is understood better, and decisions regarding it are made better, if done in the context of the business processes

If you plan on implementing either ERP or BPMS in an organization where the other already exists, it is critical that you identify and address potential conflicts or duplication of effort, or you could end up with a very large problem


ERP and BPM Work Together Well

BPM can help ERP:

ERP information is more useful if understood in the context of the organization’s business processes

If the ERP information isn’t what’s desired, it may require a process change

ERP can help BPM:

ERP data provides the KPIs that help identify potential process problems, which are inputs to the executive dashboard

Assists with process design or redesign – helps with forecasting and optimization analysis


ERP Modules

The purpose of ERP is to facilitate automated real time data flow between all business functions:

Finance/accounting

Human resources

Manufacturing

Customer relationship management, including sales and marketing

Supply chain management

Project management

It also helps connect firms to their suppliers and customers


Steps in Implementing ERP Need assessment

Document the critical business processes, inflection points and key performance indicators (KPI)

Identify implementation team Consider hiring or contracting with an experienced professional to guide

you through the implementation process

Evaluate ERP systems, and make final selection Depends on your industry, your business needs and your system

preferences. One consideration is whether you need an on-site ERP system or a cloud computing ERP system. Many businesses have made the jump to the cloud

Prepare for change It’s important to stay transparent with your employees about the change

and engage them when possible. ERP transitions are as much about changing culture as changing technology


From http://info.spindustrystaffing.com/blog/bid/235975/10-Steps-to-a-Successful-ERP-Implementation, accessed 3/14/15.

Steps in Implementing ERP (Cont’d.) Analyze current data

Decide which pieces need to be converted. After your data is all entered into the ERP database (most databases allow data entry via spreadsheet) you need to clean it up

Implement ERP

Conduct testing System and user acceptance testing is a key phase of the

implementation process

Conduct training Find a group that conducts onsite trainingt o make sure everyone is up

to speed. You’ll want to make sure your IT team has extra training to know how to handle any tech problems that may arise in the future

Go live

Provide ongoing support


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