business process modeling and automation - food for thoughts

Business Process Modeling and Automation

giving control back to business

13 September 2016

DanGa

K E W Process Modeling and Automation

31 August 2016 giving control back to business 2

Who am I ?

BPM Lifecycle

Example 1 – Ordering Process

Example 2 – Product Classification Process

Process Modeling & Documentation

Automation

Addendum

DanGa



Who am I ?

BPM Lifecycle




Automation

Addendum

DanGa

K E W BPM Lifecycle


Process identification

Conformance and performance insights

Conformance and performance insights

Processmonitoring and

controlling

Executable processmodel

Executable processmodel

Processimplementation To-be process

model

To-be process model

Processanalysis

As-is processmodel

As-is processmodel

Process discovery

Process architectureProcess architecture

Processredesign

Insights onweaknesses and

their impact

Insights onweaknesses and

their impact

DanGa

K E W BPM Lifecycle

Identification

Architecture (management, core,

support processes)

Portfolio (set of processes prioritized to

a number of dimensions)

Discovery (interviews, desk-

research, …)

AS-IS Models & Documentation

Control Flow, Physical or Information

Objects, and Resources

Analysis (Process and data driven)

Gain insight and detect weaknesses

Discover opportunities and risks

Analysis techniques (root-cause,

process simulation)


Redesign

TO-BE Models

Improve process models along

dimensions cost, time, quality OR

agility (flexibility) dimensions

Implementation

Organizational Change Management

(re-organizing work, training people)

Process Automation

Monitoring and Controlling

Dashboards, reports and alerts

Process Mining

DanGa



Who am I ?

BPM Lifecycle




Automation

Addendum

DanGa

K E W Example 1: Processing of OEM Orders

Objective = Automate the processing of OEM purchase orders

Approach

Discovery and Modeling AS-IS situation from different perspectives

Interviews with all involved stakeholders (Sales, Planning, Production, Shipping and

Billing departments - Customer Purchasing and IT organization)

Model Conversation Diagrams and Process Flows Diagrams

Analyze AS-IS situation and decide on way forward

Develop and Implement TO-Be situation

Evaluate Results after 6 months of operation


DanGa

K E W Viewpoint Key Account Manager


One customer

with multiple

plants in Europe

One ordering

process and

order type

DanGa

K E W Viewpoint Sales Department


Communication

with OEM plants

via eProcurement

Portal

Two types of

orders:

Spare Part

Orders

Long Term

Contracts with

Delivery

Schedules

(Call-Off)

DanGa

K E W Viewpoint OEM Ordering Process


Two Ordering

Processes:

Long Term

Contracts with

Delivery

Schedules

(Call-Off)

generated by

MRP

Spare Part

Ordering

Process

DanGa

K E W Findings and way forward

Findings

OEM sends TWO structurally different TYPES of ORDERS

Spare Parts normal purchase order

Production Parts delivery schedule consists only of requested dates/weeks

The supplier handles both orders as normal sales orders

Translating the requested dates/weeks into order line items

RESULTS = Resource-intensive AND error-prone process

Way forward

Implement Scheduling Agreements at the Supplier

Implement Electronic Exchange of Purchase Orders and Delivery Schedules


DanGa

K E W NEW Ordering Process Scheduling Agreements


Delivery Schedules are entered manually or processed automatically

DanGa

K E W Outcome – Savings


Documented and Transparent Internal and External Processes

Ordering Processes are improved along the dimensions

Efficiency = cycle-time for processing orders is reduced

Effectiveness = impact of the internal ordering handling process is reduced

Networking = improved collaboration with partners

Savings: Several hours per week which can now be spent on value-

adding actiivities

Increased Customer Satisfaction – error-free ordering process

DanGa



Who am I ?

BPM Lifecycle




Automation

Addendum

DanGa

K E W Example 2: Product Classification Process

Objective = Classifying technical products according ETIM model

Trigger = Low correctness of classified products

Actors = ETIM, R&D, Marketing, Customers, Sales

Approach

Discovery and Modeling AS-IS situation from different perspectives

Interviews with all involved stakeholders (Sales, Marketing, R&D, ETIM)

Model Conversation Diagrams and Process Flows Diagrams

Analyze AS-IS situation and decide on way forward

Develop and Implement TO-Be situation


DanGa

K E W ETIM Product & Classification Database

Suppliers of goods for the Building & Construction industry provide Product

Data and Product Characteristics to a central Product Database.

Wholesalers retrieve this data, enrich the data with their own product

information and store the enriched data back in the central Product Database.

Installation companies / Building architects search the Product Database to

find products based on characteristics (e.g. measurements, type of material).

Installation companies can also retrieve agreed upon prices with their

Wholesalers.

The ETIM Product & Classification Database is extremely important for the

whole Building & Construction Industry


DanGa

K E W Product Creation Process


DanGa

K E W Issue 1: Product Launch Moment


Marketing launches product before Product & Classification Data are made

available to Wholesalers and their customers via the ETIM Product

Classification Database

DanGa

K E W Issue 2: Retrieval of classification data


Internal Sales Department has to chase Product Data from the R&D

Department and determine Classification Data while not qualified for doing

this.

DanGa

K E W Findings and way forward

Findings:

MAIN: Processes, Data and Resources cannot be seen independently

Issue 1: Product is launched before the Product & Classification Data is made

available to Wholesalers and their customers.

Issue 2: Internal Sales Department has to retrieve Product Data and

determine Classification Data after the Product has been launched.

RESULTS = Resource-intensive AND error-prone process

Way forward

Generate and store required Product & Classification Data from the start of

the product lifecycle when the needs are expressed.

Enter the required data via electronic messaging in the ETIM database


DanGa

K E W NEW Product Creation Process


Valuable for your organization? You know where to find me.

Waardevol voor uw orgisatie? U weet waar u mij kunt vinden.

DanGa

K E W Outcome – savings

Product Classification process is improved along the dimensions

Efficiency =

Cycle-time for gathering classification data is reduced significantly

Data becomes faster available to Wholesalers and End-Customers

Effectiveness = one version of the truth

Impact of the classification process on the launch of products is reduced

Quality of classified products is significantly improved

Networking = improved collaboration with internally

Product creation related data is instantly available for the whole organization


DanGa



Who am I ?

BPM Lifecycle




Automation

Addendum

DanGa

K E W Process Discovery improves Business Values


Awareness leads to Improved Efficiency

why! Each process (in scope) is examined and modeled (AS-IS) which

immediately reveals waste or inefficiencies – redundant work / poor hand-overs

Awareness leads to Accelerated Effectiveness

why! AS-IS process models reveal the connection between data, resources and

events which allows for making better decisions and faster handling of exceptions

Awareness leads to Improved Agility

why! AS-IS process models reveal all existing processes which allows for

executives and staff to find the best existing process for the task ahead

DanGa

K E W Process Analysis improves Business Values


Understanding leads to Improved Efficiency

why! Explaining and resolving bottlenecks.

Understanding leads to Accelerated Effectiveness

why! Ensuring work is done by the right person with the right data at the right time

DanGa



Who am I ?

BPM Lifecycle




BPM Approach

Addendum

DanGa

K E W Business Process Management Approach


DanGa

K E W Determine Critical Outcomes


What is important here?

DO not try to look at all the goals and related objectives

Environment = all stakeholders (customers, suppliers, regulatory instances, employees)

What should be done?

Match environment statements with company objectives & determine three most critical outcomes

Identify the key business processes that impact these business outcomes

Model these high level process using conversation diagrams

How should this be done?

Interviews of key stakeholders or other business leaders are very helpful

This is also a great chance to generate buy-in.

1

2 3

DanGa

K E W Determine key operational business processe


Focus on the quantitative measures to achieve an objective

Customer Satisfaction = Response Time, Order-Cycle-Time

DO not look at all measures BUT find the most important ones with significant impact


Define performance measures

Identify Detail Business Processes that influence the performance measures

Select a Target Business Process

Model the AS-IS Business Process


4

5

7

6

DanGa

K E W Select a Target Business Process

Identify Suitable Target Business Processes

Ensure the Business Process is important enough and has a lot of impact!

Define criteria for choosing the target Business Process

Check the expectations, challenges and problems of environment

Develop a scoring matrix according to selected criteria – such as:

Relatively low level of maturity easier to improve

Activities are poorly defined

Flow of work is highly variable

High level of impact produces higher return

Lots of workarounds and touches customers or suppliers

Lack of management visibility

Low complexity enables quick iteration and improvement

Avoid end-to-end processes with too many touch points


DanGa

K E W Evaluate the business processes



Understand the list of issues – data / resource / stakeholders related

Understand the impact of the issues – relevancy / importance / critical

Understand the reasons / causes of the issues – what can we do better and how or avoid


Evaluate the AS-IS business processes = current processes

Identify waste and bottlenecks, often presented as non-value added activities

Find ways to eliminate non-value added activities

Break down each activity and launch a discussion with involved stakeholders

8

DanGa

K E W Develop the TO-BE processes



These are the future processes – TO-BE everyone need to agree


Model the TO-BE business processes

Define KP’s and include the KPI’s in the modeled processes

This will enable you to simulate the results of the newly modeled processed and watch the new

behavior

DanGa

K E W Business Process Management Approach


1 = Select a Business Objective

2 = Identify Key Business

Processes that impact the business

objective

3 = Model the Process Landscape

4 = Define performance measures

5 = Identify Detail Business

Processes that influence the

performance measures

6 = Select a Target Business

Process

7 = Model the AS-IS Business

Process

8 = Evaluate AS-IS, the current

Business Process

9 = Develop the TO-BE, future

Business Process

10 = Implement TO-BE

11 = Implement KPI’s

DanGa



Who am I ?

BPM Lifecycle




BPM Approach

Addendum

For more information please contact: Danny Gaethofs | Consultant / Adviseur

Business to Technologies

Email: [email protected] Mobile: +31(0)6 515 40 255 LinkedIn: www.linkedin.com/in/danga/ | XING: http://www.xing.com/profile/Danny_Gaethofs Twitter: @DannyGaethofs | Weblog: www.danga.biz | SLIDESHARE: http://www.slideshare.net/danga/

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