how a business process vision may boost innovative ideas

1 May 22-24, 2007

Washington Dulles HiltonThe Business Transformation Conference

Salvatore LATRONICO Francesco BATTISTABPM Consultancy Director Marketing Directoropenwork

Session Title:How a business process vision may boost innovative ideas

WelcomeWelcome

to Transformation and Innovation 2007 The Business Transformation Conference

2 May 22-24, 2007


Agenda

• BPM focus and purposes• From issues to a software solution in a real

BPM project case (TNT Global Express Italy)• Software solution implementation: classical

cycle vs. Implementing-Analysis• Implementing-Analysis boosts innovative

ideas and creativity

3 May 22-24, 2007


Vertical approach and Horizontal vision

Sales &Marketing

Financial &Controlling

Procurement

Production& Logistics

ERPCRM Legacy

4 May 22-24, 2007


Functional Islands and Process Bridges

5 May 22-24, 2007


Introducing a real case

Analyzing a real BPM project case (TNT Global Express Italy), we will show how a BPM suite may help organizations to evolve from a departmental/functional vision into a process vision, where operators and systems are guided and orchestrated together, with substantial and valuable operational and strategic benefits.

Adopting BPM not only as a mere technology but taking advantage of its most sophisticated methodological approaches, provides the opportunity for a prompt alignment of organizational models and processes execution.

As a consequence an ideal environment for agile and continuous process improvements is set up, with sustainable costs and timings, stimulating more and more business people in proposing new ideas and creative suggestions.

6 May 22-24, 2007


Project requirements

Fiscal purposes require the company to generate, verify and store securely, on a monthly basis, a set of documents for each legal entity belonging to the company group.

During the whole year, F&A department prints from the ERP system all necessary accounting documents, producing very large files, each containing thousands of accounting records related to one single legal entity and one single month (with a special procedure for end of year closure period).

Every accounting document is stored into the Document Management System (DMS) and at defined deadlines an IT operator accesses the DMS and verifies all required accounting documents are already available in the system.

Then the IT operator selects relevant documents in the DMS, creates documents volume and corresponding hash codes file (standard well-known file fingerprint) and electronically signs them along with related timestamp.

7 May 22-24, 2007


Criticalities

Information System solutions split into several environments

Organizational process involving and impacting different departments and areas

Software tools providing functional solutions, but each limited to one single area/ environment

Frequent and rapid organizational changes

Time-consuming process

Wrong ability/skill management/allocation

Owner not allowed to control its process and related timings

Unstructured (unreliable) communication among process actors

8 May 22-24, 2007


Main action lines

System vs. Human: split process into basic activities separating ones requiring human intervention form others that may be automated.

Orchestration: assemble basic activities in an automated process to guide people and system in compliance with organizational rules.

Evolution: agility and ability to apply changes to processes from an organizational (model) and a technological (execute) point of view.

Ownership and delegation: each process actor has to actually and directly do what he/she is capable and responsible for.

Push vs. Pull: procedure has to be an active element guiding, reminding and pressing process actors instead of waiting for their intervention.

Content check: accounting documents check has to be allowed also during and after the archiving process and not only at the beginning.

SLA: alerts related to process deadlines have to be introduced to measure service level.

9 May 22-24, 2007


Abstract Business Process (BP)

System to Systemdaemon

single instance

System to Human to Systemtriggered by DA for each volume

multiple instance

10 May 22-24, 2007


Atomic activitiesActivity Owner Tool Trigger Ability

1 Printing Documents Finance ERP PULL Knowledge of ERP printingfunctions

2 Optimizing Documents ITDocument-optimizerdedicated tool

PULL Use of document-optimizerdedicated tool

3 Creating Document Volumes IT File System PULLKnowledge of deadlinesand rules for volume creation

4Creating and signingvolumes hash codesFile

IT on behalfof

F&A Director

SignatureSoftware

Action 3Completed

Investigate and verify contentof each document beforesigning

5 Burning DVD IT DVD burningSoftware

Action 4Completed

Use of DVD burning software

6 Delivering DVD to F&A IT Action 5Completed

7 Verifying DVD Finance File System DVD received

8StoringDVD in fireproof safe Finance

Action 7Completed(positive verification)

9Sending signed hashcodes file to EA Finance Mail System

Action 7Completed(positive verification)

Knowledge of e-mail software

10Receiving signed hashcodes file receipt Finance Mail System Pull Knowledge of e-mail

software

11Indexing and store on DMS accounting documents, hash codes file and related receipts

IT DMS and indexing tool

Action 8Completed

Knowledge of DMS and indexing tool

11 May 22-24, 2007


Fully Specialized Business Process

Executable Business Process

12 May 22-24, 2007


Project outcomes

People know what to do even when not knowing (partially or totally) the process

People understand what is happening in the process thanks to e-mail, reminders, alerts helping the process to advance

People are now monitored and traced during activities execution.

The BPM solution delivered, fully satisfied customer requirements on the GO LIVE project date… but…

13 May 22-24, 2007


Volume Signature: evolution 1

Why should the F&A Director always sign a volume for approval?

What would happen if she/he detects an error in one of the volumedocuments?

Those questions originated a change in the process, allowing the F&A Director to approve or invalidate volume in case of errors, requesting F&A operators to print again all volume accounting documents.

All this was made by applying very simple modifications to flow chart and related web form.

14 May 22-24, 2007



15 May 22-24, 2007



Why should the F&A Director always entirely approve or reject a volume?

Why should even one single error in one single volume document cause the entire volume to be rejected?

Those questions originated a change in the process allowing the F&A Director to even partially approve volumes requesting the F&A department to mend errors and print again invalidated fiscal documents only.

All this was made applying very simple modifications to flow chart and related web form.

16 May 22-24, 2007



17 May 22-24, 2007


Operational and Strategic benefits

TIME REDUCTION: reduced timings needed for requirements definition and functional analysis.

EASY EVOLUTION 1: lack of initial clear and well defined specifications has not required major intervention/changes on what previously delivered.

EASY EVOLUTION 2: further subsequent analysis performed during implementation have not required major intervention/changes on what already delivered.

AUTOMATION: everything possible has been automated and user are now involved in processes only when strictly required.

IMMEDIATE: simple and direct process documentation as a direct consequence of the definition of the process model.

COMMON GROUND: the solution delivered is the direct result of business people knowledge (specialized when needed for operational details) and not a translation of their ideas and point of view.

18 May 22-24, 2007


Focus points: specialize vs. translate

Abstract BP

Fully Specialized BP

Executable BP

sp

ecia

lizatio

n

• using same tools and concepts• specialization is NOT

translation• From business management

tools to software applications not re-building knowledge representation but detailing it

Starting from the initial Abstract business process, working on it with subsequent specializing steps, we can finally define business operational details, executable

business processes: the software solution.

19 May 22-24, 2007


SPECIALIZATION

Focus points: specialization

AbstractBusiness Process

ExecutableBusiness Process

Macro activities

Atomic activities

20 May 22-24, 2007


From Business needs to software solution Implementing-Analysis: one phase

specialization

21 May 22-24, 2007


Implementing software solutionsApproach, methodologies and Business-Software distance!

BUSINESS SOFTWARE

22 May 22-24, 2007


From Business needs to software solutionClassic cycle: phases

ANALYSIS DESIGN IMPLEMENTATION

23 May 22-24, 2007


From Business needs to software solutionClassic cycle: phases

Analysisdetailed functional (generally) non-technical description of whatthe customer does (AS IS) and wants or needs (TO BE)

Designhigh level technical and technological directions defining the correctarchitecture and environment to build what the customer wants

Implementationtechnical activities (code writings, system configurations orsimilar) in compliance with defined architectural context to functionally deliver what the customer wants

24 May 22-24, 2007


Market-Business-Software alignmentClassic cycle: performance

BUSINESS M

ODEL

ANALYSIS

TECH

LAYER

DESIGN

SOFTW

ARE EXECUTION

IMPLEM

ENTATION

real world / m

arket

SP

EE

D

SP

EE

D

SP

EE

D

SP

EE

D

25 May 22-24, 2007



26 May 22-24, 2007



BUSINESSMODELANALYSIS

TECH LAYERDESIGN

SOFTWAREEXECUTIONIMPLEMENTATION

27 May 22-24, 2007


From Business needs to software solutionClassic cycle: concepts translation approach

ANALYSIS DESIGN IMPLEMENTATION

Business skills IT skills IT skills

28 May 22-24, 2007


From Business needs to software solution Implementing-Analysis: one phase

29 May 22-24, 2007


Market-Business-Software alignmentImplementing-Analysis performance

30 May 22-24, 2007


Market-Business-Software alignmentImplementing-Analysis performance

31 May 22-24, 2007


From Business needs to software solutionImplementing-Analysis: concepts specialization approach

IMPLEMENTING-ANALYSIS

Business skills IT skills

32 May 22-24, 2007




33 May 22-24, 2007




34 May 22-24, 2007




35 May 22-24, 2007




36 May 22-24, 2007


From Business needs to software solutionImplementing-Analysis: the higher maturity, the lower IT skills required


37 May 22-24, 2007


Processes: creativity first!

As proposed by Mark KLEIN and Claudio PETTI (MIT Sloan School of Management - “A Handbook-based Methodology for Redesigning Business Processes”) modeling organizations it’s a creative process where inventing or re-inventing is a key factor.

Implementing – Analysis supports this process allowing to link ideas with real-world just-in-time.

38 May 22-24, 2007


So where BPM is going?

While today is very clear and generally agreed that one of the most important topic in BPM is the integration among systems, it’s important to underline that this is one but not the only challenge.

Implementing-Analysis approach suggests another important area that brings organizational new opportunities in terms of business agility and change management, enabling and extending company people contribution to business continuous improvement.

From this point of view, BPM is not simply another piece of software but a key organizational element able to boost ideas and innovation in a competitive world where the ability to change quickly may make a great difference.

39 May 22-24, 2007


Thank YouThank YSalvatore LATRONICO Francesco BATTISTABPM Consultancy Director Marketing Directoropenwork

Contact Information:+39 02 77297558 [email protected]@openworkBPM.com

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