process oriented architecture
TRANSCRIPT
Process Oriented Architecture
Alan McSweeney
http://ie.linkedin.com/in/alanmcsweeney
Process Oriented Architecture Introduction
• Individual process and process areas within an organisational vertical hierarchy represent competencies and associated organisational operational functions and structures designed to handle units of work
• These competencies are utilised or invoked in response to requests or events
• Competencies/process areas can be shared
• A Process Oriented Architecture is a way of linking process areas to actual (desired) interactions – customer (external interacting party) service journeys through the organisation
• Allows two views of any process to be maintained and operated − External view – that experienced by user − Internal view – that worked on by the organisational competency
• There will always be two views of any process
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Process Oriented Architecture Maps Actual External Interaction Paths To Organisational Operational Process Competencies
August 17, 2016 3
External Interaction Paths – Experience Journeys
Organisational Operational Process Competency Grouping
External Interacting Parties
• An organisation will interact will multiple external parties
• Each external party will have a number of interaction paths or journeys
• These journeys are the routes of experience of external parties
• These routes of experience need to be mapped (as) seamlessly (as possible) to internal organisational operational process competency groupings
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Process Oriented Architecture Maps Actual External Interaction Paths To Organisational Operational Process Competencies
• External Interaction Paths – the natural real life way a customer (external party) interacts with the organisation and avails of the organisation’s products and services
• Organisational Operational Process Competency Grouping – the way the organisation structures itself to perform work
• There are discontinuities and disconnections between the natural interaction sequence and the way the organisation responds to these interactions
• Leads to differences between customer (external party) expectations and what actually happens
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External Interaction Paths
• These represent the Straight Through Processing that the customer (external party) wants to experience
• The complexity of internal organisational operational process competency groupings needs to be masked from the customer (external party)
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Process Oriented Architecture
• External interaction paths represent how external parties actually (want to) interact with the organisation − External interaction paths are effectively meta-processes that
aggregate individual processes/sub-processes
• Process Oriented Architecture links organisation competencies to these contact sequences − Enables end-to-end view, across cross functional and operational
areas
− It is the glue that bonds customer (external party) interaction sequences with operational processes and structures
− Enables straight through processing
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Three Pillars Of Any Organisation O
rgan
isat
ion
Strategy, Infrastructure and Product and Service Development
Develop strategy, implement governance and management, commit to the enterprise, build technology, communication and resource infrastructure that supports products and services and support functional processes, develop and manage new products and services, manage mergers,
acquisitions and divestments, develop and manage strategic business partners and business relationships and the supply chain
Operations
Implement and operate organisation competencies and associated processes that support the customer operations and management including both day-to-day and operations support and readiness processes and sales management and supplier/partner relationship management
including customer acquisition, product and service sales, product and service delivery and billing
Organisation Management
Basic organisation competencies and associated business processes required to run any organisation - facilities, information technology, financial management, legal management, HR,
regulatory management, process, cost and quality management, strategy development and planning, improvement and change and knowledge management
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Three Pillars Of Any Organisation
• Exact organisation profile depends on many factors such as: − The type and mix of products and services the organisation
provides
− The nature of the customer relationship – known or anonymous
− The number of different types of customer
− The number and type of external parties interacted with
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Sample Enterprise Business Process Groups – Generalised Structure
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Vision, Strategy, Business
Management
Core Operational Processes With Cross Functional Linkages
Management and Support Processes
External Party Facing Processes
Supporting Processes
Interactions Between Organisation Processes
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Core Processes
Supporting Processes
Management Processes
Defines Strategy and Approach for Implementing and Operating
Core Operational Processes
Defines Strategy and Approach for Implementing and Operating
Core Operational Processes
External Interacting Parties and Experience Journeys
What They Interact With
Core Processes
Interactions Between Organisation Processes
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Business Customer
Retail Customer
Public
Service Provider
Dealer
Sub-Contractor
Agent
Regulator Supplier
Taking A Process Oriented Architecture Approach
• This enables the mapping of external straight through processing to internal organisational operational process competency groupings
• Maps the desired customer (external party) experiences to competencies that may cross organisational functional boundaries
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Sample Organisation Business Process Models – Generalised Structure
• Core Operational Processes – drive and operate the organisation, deliver value, support external party interactions
• Management and Support Processes – internal processes and associated business functions that enable the operation and delivery of the core operational processes
• Vision, Strategy, Business Management – processes that measure, control and optimise the operational and support processes and set the direction of the organisation
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Sample Organisation Business Process Models – Generalised Structure
Vision, Strategy, Business
Management
Core Operational Processes With Cross Functional Linkages
Management and Support Processes
Develop and Manage Products and Services
Market and Sell Products and
Services
Deliver Products and Services
Manage Customer Service
Human Resource Management
and Development
Information Technology
Management
Financial Management
Facilities Management
Legal, Regulatory, Environment,
Health and Safety
Management
External Relationship and
Partner Management
Service, Knowledge,
Improvement and Change
Management
Vision and Strategy
Business Planning, Merger, Acquisition
Governance and Compliance
Core And Supporting Processes And Interactions
• External parties interact with the organisation’s core business processes
• Core business processes may be logical, cross-functional representations of multiple, internal operational processes that may or may not be connected to present a seamless logical view
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Achieving A Process Oriented Architecture
Organisation Competency And Process Definition
Customer Experience Journey Definitions
Mappings From Experience Journeys To
Organisation Competency
Process Oriented
Architecture
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Achieving A Process Oriented Architecture
• This requires: 1. Structured approach to identifying, categorising and
structuring internal organisational operational process competency groupings – use sample process breakdowns as a starting point
2. Customer (external party) experiences journeys identification and definition – take a use case approach
3. Mapping of experiences journeys to internal operational competencies
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Sample Organisational Process Breakdowns
• APQC (American Productivity and Quality Center) − Publish the Process Classification Framework (PCF) – defined
generic and domain-specific organisation process breakdown
− https://www.apqc.org/pcf
• TMForum − Publish the enhanced Telecommunications Operating Breakdown
(eTOM) business process framework aimed at telecommunications service providers
− https://www.tmforum.org/business-process-framework/
− Can be generalised to be applied to other utility-type companies
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Sample Organisational Process Breakdowns
• These can be used as frameworks for identifying, categorising and structuring internal organisational operational process competency groupings
• Provide a foundation for this development to reduce the effort and improve the quality of the results
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APQC (American Productivity and Quality Center) Process Classification Framework (PCF)
• Not really an operational process breakdown
• More an organisational competency breakdown
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APQC PCF Generic Organisational Process Breakdowns
Organisation
1.0 Develop Vision and Strategy 2.0 Develop and Manage Products
and Services
3.0 Market and Sell Products and Services
4.0 Deliver Products and Services
5.0 Manage Customer Service 6.0 Develop and Manage Human
Capital
7.0 Manage Information Technology 8.0 Manage Financial Resources
9.0 Acquire, Construct, and Manage Property
10.0 Manage Environmental Health and Safety (EHS)
11.0 Manage External Relationships 12.0 Manage Knowledge,
Improvement, and Change
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APQC PCF - External Interaction Process/ Competency Areas
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Organisation
1.0 Develop Vision and Strategy 2.0 Develop and Manage Products
and Services
3.0 Market and Sell Products and Services
4.0 Deliver Products and Services
5.0 Manage Customer Service 6.0 Develop and Manage Human
Capital
7.0 Manage Information Technology 8.0 Manage Financial Resources
9.0 Acquire, Construct, and Manage Property
10.0 Manage Environmental Health and Safety (EHS)
11.0 Manage External Relationships 12.0 Manage Knowledge,
Improvement, and Change
APQC PCF Generic Organisational Process Breakdowns
• APQC model mixes pure operational/delivery processes/competencies with strategy and planning topics
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APQC PCF Model - Operational Process Develop and Manage Products and Services – Generic Process Breakdown
Develop And Manage Products And Services
Manage Product And Service Portfolio
Evaluate Performance Of Existing Products/Services Against Market Opportunities
Define Product/Service Development Requirements
Perform Discovery Research
Confirm Alignment Of Product/Service Concepts With Business Strategy
Manage Product And Service Life Cycle
Manage Product And Service Master Data
Develop Products And Services
Design, Build, And Evaluate Products And Services
Test Market For New Or Revised Products And Services
Prepare For Production
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APQC Model - Operational Process Market and Sell Products and Services - Generic Breakdown
Market And Sell Products And Services
Understand Markets, Customers, And Capabilities
Perform Customer And Market Intelligence
Analysis
Evaluate And Prioritise Market Opportunities
Develop Marketing Strategy
Define And Manage Channel Strategy
Define Pricing Strategy To Align To Value Proposition
Define Offering And Customer Value
Proposition
Develop Sales Strategy
Develop Sales Forecast
Develop Sales Partner/Alliance
Relationships
Establish Overall Sales Budgets
Establish Sales Goals And Measures
Establish Customer Management Measures
Develop And Manage Marketing Plans
Establish Goals, Objectives, And Metrics For Products
By Channels/Segments
Establish Marketing Budgets
Develop And Manage Media
Develop And Manage Pricing
Develop And Manage Promotional Activities
Track Customer Management Measures
Develop And Manage Packaging Strategy
Develop And Manage Sales Plans
Generate Leads
Manage Customers And Accounts
Manage Customer Sales
Manage Sales Orders
Manage Sales Force
Manage Sales Partners And Alliances
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APQC Model - Operational Process Deliver Products and Services - Generic Breakdown
Deliver Products And Services
Plan For And Acquire Necessary Resources
Develop Production And Materials Strategies
Manage Demand For Products And Services
Create Materials Plan
Create And Manage Master Production
Schedule
Plan Distribution Requirements
Establish Distribution Planning Constraints
Review Distribution Planning Policies
Assess Distribution Planning Performance
Develop Quality Standards And Procedures
Procure Materials And Services
Develop Sourcing Strategies
Select Suppliers And Develop/Maintain
Contracts
Order Materials And Services
Appraise And Develop Suppliers
Produce/Manufacture/ Deliver Product
Schedule Production
Produce Product
Schedule And Perform Maintenance
Perform Quality Testing
Maintain Production Records And Manage Lot
Traceability
Deliver Service To Customer
Confirm Specific Service Requirements For
Individual Customer
Identify And Schedule Resources To Meet Service
Requirements
Provide Service To Specific Customers
Ensure Quality Of Service
Manage Logistics And Warehousing
Define Logistics Strategy
Plan And Manage Inbound Material Flow
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APQC Model - Operational Process Manage Customer Service - Generic Breakdown
Manage Customer Service
Develop Customer Care/Customer Service Strategy
Develop Customer Service Segmentation/Prioritisation
Define Customer Service Policies And Procedures
Establish Service Levels For Customers
Plan And Manage Customer Service Operations
Plan And Manage Customer Service Work Force
Manage Customer Service Requests/Inquiries
Manage Customer Complaints
Measure And Evaluate Customer Service Operations
Measure Customer Satisfaction With Customer Requests/Inquiries Handling
Measure Customer Satisfaction With Customer-
Complaint Handling And Resolution
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eTOM Business Process Framework
• Designed for telecoms utilities but it can be generalised and effectively applied to many other (utility) organisations
• Structure consists of operational (vertical) process groups and cross-functional (horizontal) process groups
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eTOM Business Process Framework Overview
Strategy, Infrastructure and Product
Operations
Enterprise Management
Customer
Strategy, New Ideas, Products And Associated Supporting Infrastructure
Moved to Production and Steady-State Operations
Fundamental Supporting Business Processes Needed To
Run Any Business
Operational Processes – Sales,
Fulfillment, Assurance, Billing
and Support
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eTOM Business Process Framework - Detail
Strategy, Infrastructure and Product Operations
Strategy and Commit
Infrastructure Lifecycle
Management
Product Lifecycle
Management
Operations Support and
Readiness
Fulfilment Assurance Billing and Revenue
Management
Marketing and Offer Management
Service Development and Management
Resource Development and Management
Supply Chain Development Management
Customer Relationship Management
Service Management and Operations
Resource Management and Operations
Supplier/Partner Relationship Management
Operations Organisation Pillar – Sub-Processes Operations Pillar
Customer Relationship Management
CRM - Support and Readiness
Customer Interface Management
Marketing Fulfilment Response
Selling
Order Handling Problem Handling
Customer Quality of Service/SLA
Management Retention and Loyalty
Bill Invoice Management
Bill Payments and Receivables
Management
Bill Inquiry Handling Charging
Manage Billing Events Manage Balances
Service Management and Operations
Service Management and Operations
Support and Readiness
Service Configuration and Activation
Service Problem Management
Service Quality Management
Service Guiding and Mediation
Resource Management and
Operations
Resource Management and
Operations Support and Readiness
Resource Provisioning
Resource Trouble Management
Resource Performance Management
Resource Data Collection and
Distribution
Resource Mediation and Reporting
Manage Workforce
Supplier/Partner Relationship Management
Supplier/Partner Relationship
Management Support and Readiness
Supplier/Partner Requisition
Management
Supplier/Partner Problem Reporting and Management
Supplier/Partner Performance Management
Supplier/Partner Settlements and
Payments Management
Supplier/Partner Interface
Management
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CRM Cross Functional Process And Operational Process Groups
Operations Support and Readiness
Fulfilment Assurance Billing and Revenue
Management
Customer Relationship Management
CRM - Support and Readiness Customer Interface Management
Marketing Fulfilment Response
Selling
Order Handling
Problem Handling
Customer Quality of Service/SLA
Management
Retention and Loyalty
Bill Invoice Management
Bill Payments and Receivables
Management
Bill Inquiry Handling
Charging
Manage Billing Usage Data
Manage Account Balances
Cross-Functional Processes
Op
era
tion
al P
rocess G
rou
ps
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Customer Relationship Management Process Area and Sub-Processes – Levels 0 and 1
Customer Relationship Management
CRM - Support and Readiness Customer Interface
Management
Marketing Fulfilment Response
Selling
Order Handling Problem Handling
Customer Quality of Service/SLA Management
Retention and Loyalty
Bill Invoice Management Bill Payments and Receivables
Management
Bill Inquiry Handling Charging
Manage Billing Events Manage Balances
• Generic breakdown of high-level CRM processes and associated functions
• Considers the fundamental knowledge of customers needs and includes all functionalities necessary for the acquisition, enhancement and retention of a relationship with a customer
• Concerned with customer service and support
• Involves retention management, cross-selling, up-selling and direct marketing for the purpose of selling to customers
• Includes the collection of customer information and its application to personalise, customise and integrate delivery of service to a customer, as well as to identify opportunities for increasing the value of the customer to the organisation
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Customer Relationship Management Process Area and Sub-Processes – Levels 0,1 and 2
Customer Relationship Management
CRM - Support and Readiness
Support Customer Interface
Management
Support Order Handling
Support Problem Handling
Support Retention and
Loyalty
Support Marketing Fulfilment
Support Selling
Support Customer Quality of
Service/SLA
Manage Campaign
Manage Customer Inventory
Manage Product Offering
Inventory
Manage Sales Inventory
Support Bill Invoice
Management
Support Bill Payments and
Receivables Management
Support Bill Inquiry Handling
Customer Interface
Management
Manage Contact
Manage Request (Including Self
Service)
Analyse and Report on Customer
Mediate and Orchestrate
Customer Interactions
Marketing Fulfilment Response
Issue and Distribute Marketing Collaterals
Track Leads
Selling
Manage Prospect
Qualify Opportunity
Negotiate Sales/Contract
Acquire Customer Data
Cross/Up Selling
Develop Sales Proposal
Manage Sales Accounts
Order Handling
Determine Customer Order
Feasibility
Authorise Credit
Track and Manage Customer Order
Handling
Complete Customer Order
Issue Customer Orders
Report Customer Order Handling
Close Customer Order
Problem Handling
Isolate Customer Problem
Report Customer Problem
Track and Manage Customer Problem
Close Customer Problem Report
Create Customer Problem Report
Correct and Recover Customer
Problem
Customer Quality of Service/SLA Management
Assess Customer Quality of
Service/SLA Performance
Manage Quality of Service/SLA
Violation
Report Customer Quality of Service
Performance
Create Customer Quality of Service
Performance Degradation
Report Track and Manage Customer Quality
of Service Performance
Resolution Close Customer Quality of Service
Performance Degradation
Report
Retention and Loyalty
Establish and Terminate Customer
Relationship
Build Customer Insight
Analyse and Manage Customer
Risk
Personalise Customer Profile for Retention and
Loyalty
Validate Customer
Satisfaction
Bill Invoice Management
Apply Pricing, Discounting,
Adjustments and Rebates
Create Customer Bill Invoice
Produce and Distribute Bill
Bill Payments and Receivables
Management
Manage Customer Billing
Manage Customer Payments
Manage Customer Debt Collection
Bill Inquiry Handling
Create Customer Bill Inquiry Report
Assess Customer Bill Inquiry Report
Authorise Customer Bill
Invoice Adjustment
Track and Manage Customer Bill
Inquiry Resolution
Report Customer Bill Inquiry
Close Customer Bill Inquiry Report
Charging
Perform Rating
Apply Rate Level Discounts
Aggregate Items For Charging
Manage Customer Charging Hierarchy
Manage Billing Events
Enrich Billing Events
Guide Billing Events
Mediate Billing Events
Report Billing Event Records
Manage Balances
• This shows a possible breakdown of lower-level CRM processes and functions
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Cross Functional Processes And The Customer
• The customer sees across the structure and is not concerned with but is all too often aware of the operational elements, their complexity and lack of interoperability
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Customer Relationship Management
• Customer is a short-hand term for any external party the organisation interacts with
• An organisation will have many different types of customer
• Interaction sequence depends on the type of products and services the organisation provides
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Process Oriented Architecture And Customer Relationship Management
• Approach reduces variability and introduces consistency into customer (external party) experiences
• Enables handling of larger volumes of interactions more efficiently
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CRM Operational Success Formula
• CRM operational success is measured as the sum of successful outcome of each interaction for each customer for each customer type
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Σ ( Σ (Interaction Outcome) ) Σ ( ) Each
Customer Interaction
Each Customer
Each Customer
Type
Customer Service Journeys
• Customer (or external party) journeys are organisation interaction sequences pursued by customers as they use the services provided by the organisation
• Interaction sequence depends on the type of products and services the organisation provides
• Journeys are not always sequential
• Steps in journey involve interactions with different organisational operational processes
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Sample High Level Customer Service Journey– Buy And Pay For A Product/Service
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Look For Information/ Awareness and Interest Generated
Look For Details on
Specific Product/ Service/
Offer
Receive, Evaluate
Offer, Negotiate
and Compare
Decide To Buy
Product/ Service
Pass Enrolment,
Buy/ Subscribe
and Receive Product/ Service
Receive and Pay Usage
Statements and Bills
Query Usage Statement
and Bill, Pay Bill
Report Fault/
Complaint
Upgrade/ Buy
Additional Product/ Service/
Respond to Offer
Renew, Evaluate
Alternatives and
Negotiate
Decide to Leave/ Cancel Service
Accept Counteroffer
Do Not Pursue Interest
Do Not Accept Offer/ Accept Other
Supplier
Do Not Pursue Interest
Change Mind Before Completing
Leave Do Not
Complete
Cancelled Because of Delivery/ Provision Problems
Sample Customer Service Journey
• High-level and simplified example of a utility-type service provider operating in a competitive environment
• Every customer (external interacting party) journey will have a direct sequence indicating success from the organisation’s view and a number of alternate paths
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Service Journey And Operational Processes
• Multiple alternate routes of service journey require operational complexity
• Service journey is an abstraction of the associated operational processes
• Operational processes represent organisational competencies
• Operational complexity needs to masked from service journeys
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Sample Customer Service Journey – Phases And Steps
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Phase Step Description Research/Consider Look For Information/ Awareness
and Interest Generated Look for general information and/or be made aware of the existence of the organisation and its products/services
Inquire/Evaluate Look For Details on Specific Product/ Service/ Offer
Investigate specific offer or promotion and/or make contact with organisation to get specific details on product/service
Receive, Evaluate Offer, Negotiate and Compare
Receive and evaluate a specific offer. Negotiate the details of the offer and compare the offer with that from other suppliers/service providers
Decide/Negotiate Decide To Buy Product/ Service Make a decision to buy a specific product/service from the selected supplier/service provider
Buy/Subscribe Pass Enrolment, Buy/ Subscribe and Receive Product/ Service
The customer is successfully setup and passes any checks. Buy the specific product/service, do not change before completion and receive the product/service successfully from the supplier/service provider
Use/ Bill and Pay/ Change/ Upgrade/ Complain/Report Fault/ Leave
Receive and Pay Usage Statements and Bills, Pay Bill
Use the product/service, receive usage information and bills and pay bills
Query Usage Statement and Bill Query usage information and bill
Report Fault/ Complain Report a fault in the delivery or usage of the product/service or make a complaint
Upgrade/ Buy Additional Product/ Service/ Respond to Offer
Buy new or additional products/services or respond to upgrade/replace/add offer
Renew, Evaluate Alternatives and Negotiate
Renew at the end of the contracted period, evaluate alternatives from the current and other organisations and negotiate product/service and price
Decide to Leave/ Cancel Service Give notice to leave and cancel service
Accept Counteroffer Accept counteroffer and stay with organisation
Sample Customer Journey – Organisation Processes Interacted With
• The customer (external interacting party) will interact with organisation competency areas/processes during the journey − Primary processes – directly involved in the interaction
− Enabling processes – indirectly involved in the interaction, such as support, readiness, management, analysis, reporting
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Sample Customer Journey – Primary And Secondary Processes
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Phase Step Primary Processes Secondary Processes Research/ Consider Look For Information/
Awareness and Interest Generated
• Manage Contact • Record, Track, Analyse and Report on Customer Contacts • Manage Information Content and Access
Inquire/ Evaluate Look For Details on Specific Product/ Service/ Offer
• Respond to Customer and Issue and Distribute Marketing Collateral
• Qualify Customer
• Track Leads • Manage Prospect
Receive, Evaluate Offer, Negotiate and Compare
• Negotiate Sales/Contract • Acquire Customer Data • Cross/Up Selling • Develop Sales Proposal
• Manage Sales Accounts
Decide/ Negotiate Decide To Buy Product/ Service
Buy/Subscribe Buy/ Subscribe and Receive Product/ Service
• Determine Customer Order Feasibility • Authorise Credit • Complete Customer Order • Issue Customer Orders • Fulfil Order
• Track and Manage Customer Order Handling • Report Customer Order Handling • Manage Inventory • Manage Deliveries
Use/ Bill and Pay/ Change/ Upgrade/ Complain/ Report Fault/ Leave
Receive and Pay Usage Statements and Bills, Pay Bill
• Apply Pricing, Discounting, Adjustments and Rebates • Create Customer Bill • Produce and Distribute Bill
• Collect Billing Information • Manage Customer Billing • Manage Customer Payments • Manage Customer Debt Collection
Query Usage Statement and Bill • Receive and Handle Inquiry • Track Inquiry to Completion • Respond to Query
• Record, Track, Analyse and Report on Customer Contacts
Report Fault/ Complain • Receive and Handle Fault Report/Complaint • Track Fault Report/Complaint to Completion • Respond to Fault Report/Complaint
• Record, Track, Analyse and Report on Customer Contacts
Upgrade/ Buy Additional Product/ Service/ Respond to Offer
• Manage Contact • Negotiate Sales/Contract • Cross/Up Selling • Develop Sales Proposal
• Build Customer Insight • Analyse and Manage Customer Risk • Personalise Customer Profile for Retention and Loyalty • Validate Customer Satisfaction • Manage Information Content and Access
Renew, Evaluate Alternatives and Negotiate
• Negotiate Sales/Contract • Cross/Up Selling
Decide to Leave/ Cancel Service • Manage Termination
Accept Counteroffer
Primary And Secondary Processes
• Operational processes, both primary and secondary, can be invoked multiple times during the service journey
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So What Is A Process
• Set of activities triggered by one or more events or statuses, requiring on or more inputs and performed in structured interim contingent outcome-dependent order or sequence to generate one or more outputs and cause one or more outcomes
• Process is the self-contained unit that completes a given task
• Process can consist of sub-processes and/or activities
• Process and its constituent activities, stages and steps can be decomposed into a number of levels of detail, down to the individual atomic level
• Process analysis and design is concerned with optimising an existing or new process and focussing on efficiency and adding value
• Process is primarily concerned with its outcomes and outputs − Activities and their sequence that generate outcomes and outputs are largely
secondary − Activity and sequence view is useful for identifying opportunities for efficiencies,
resource optimisation, monitoring progress, collecting volumetric information and detecting problems, duplicated effort, bottlenecks, resource constraints and non value-adding activities
August 17, 2016 48
So What Is A Process
• A process has nothing to do with value: it should but it does not have to − This is desirable but not mandatory
• A defined process can have many attributes
• Each activity in a defined process can have many attributes such as: − Required Role/Skill
• An instantiated process can have many attributes such as: − Start − End − Process Version − Assigned Priority − Participants and Activities − Outcome(s) − Output(s)
August 17, 2016 49
Process Decomposition
• Processes can be represented at different levels of detail
August 17, 2016 50
Process
Trigger(s)
Required Input(s)
Output(s)
Outcome(s)
Process Routing
• Activities within processes can be linked by routers that direct flow and maintain order based on the values of output(s) and the status of outcome(s)
August 17, 2016 51
Activity
Trigger(s)
Required Input(s)
Output(s)
Outcome(s)
Router
Activity
Trigger(s)
Required Input(s)
Output(s)
Outcome(s)
Activity
Trigger(s)
Required Input(s)
Output(s)
Outcome(s)
Sample Partial Process Decomposition Levels – Buy And Pay For A Product/Service
Buy Product/Service
Customer Contact Management
Information Request Fulfilment Response
Provide Quotation
Collect and Validate Requirements
Process Information and Create Quotation
Issue Quotation
Follow-up on QUotation
Manage Negotiations
Sell
Handle and Fulfil Order
Billing
Bill Invoicing
Bill Payments and Receivables
Management
Bill Inquiry Handling
Receive Customer Bill Inquiry
Assess Customer Bill Inquiry
Authorise Customer Bill Invoice Adjustment
Track and Manage Customer Bill Inquiry
Resolution
Analyse Detailed Bill Inquiry
Determine Appropriate Bill Adjustment
Record Customer Bill Invoice Adjustment
Issue Adjusted Bill
Report Customer Bill Inquiry
Close Customer Bill Inquiry
Handle Payment
August 17, 2016 52
Process Inputs And Outputs/Outcomes
August 17, 2016 53
Buy And Pay For A Product/Service
Trigger(s)
Customer Interest
Required Input(s)
Customer and Product/Service
Details
Output(s)
Delivered and Billed for
Product/Service
Outcome(s)
Customer Buys and Pays for
Product/Service
Service Journey And Operational Processes
August 17, 2016 54
Look For Information/ Awareness
And Interest
Generated
Look For Details on
Specific Product/ Service/
Offer
Receive, Evaluate
Offer, Negotiate
and Compare
Decide To Buy
Product/ Service
Pass Enrolment,
Buy/ Subscribe
and Receive
Product/ Service
Receive and Pay Usage
Statements and Bills
Query Usage
Statement and Bill, Pay Bill
Report Fault/
Complaint
Upgrade/ Buy
Additional Product/ Service/
Respond to Offer
Renew, Evaluate
Alternatives and
Negotiate
Decide to Leave/ Cancel Service
Accept Counteroffer
Customer (External Party) Experiences Journey Identification And Definition
• Customer (external party) experiences journeys identification and definition is required to understand which journeys are to be mapped to organisational operational process competency groupings and optimised
August 17, 2016 55
Interactions Between Organisation Processes
• Identify possible use cases for each external interacting partner
• Define the journey for each use case
August 17, 2016 56
Business Customer
Retail Customer
Public
Service Provider
Dealer
Sub-Contractor
Agent
Regulator Supplier
Use Case Use Case
Use Case
Use Case
Use Case
Use Case
Use Case
Use Case
Use Case
Business Model Canvass
• Consider using the Business Model Canvass (developed by Alexander Osterwalder) to analyse and evaluate each use case
• Divides business into nine elements in four groups − Infrastructure
• Key Partners - the key partners and suppliers needed to achieve the business model • Key Activities - the most important activities the business must perform to ensure the
business model works • Key Resources - the most important assets to make the business model work
− Offering • Value Propositions - the value, products and services provided to the customer
− Customers • Customer Relationships - the customer relationships that need to be created • Channels - the channels through which the business reaches its customers • Customer Segments - the types of customers being targetted by the business model
− Finances • Cost Structure - the most important costs incurred by the business model • Revenue Streams - the sources through which the business model gets revenue from
customers
August 17, 2016 57
Business Model Canvass
August 17, 2016 58
Key Partners • Who are our key partners? • Who are our key suppliers? • What Key Resources do we acquire
from partners? • What Key Activities do partners
perform? MOTIVATIONS FOR PARTNERSHIPS • Optimisation and economy • Reduction of risk and uncertainty • Acquisition of resources and skills
Key Activities • What key activities do our value
propositions require • What are our distribution channels? • What are our customer relationships? • What are our revenue streams? CATEGORIES • Production • Problem Solving • Platform/Network
Value Propositions • What value do we deliver to our
customers? • Which of our customers’ problems are
we helping to solve? • What bundles of products and
services do we offer to each customer segment?
CHARACTERISTICS • Novelty • Performance • Customisation • “Getting the Job Done” • Design • Brand • Status • Cost Reduction • Risk Reduction • Accessibility • Convenience/Usability
Customer Relationships • What type of relationship does each of our
customer segments expect us to establish and maintain with them?
• What ones have we already established? • How are they integrated into our business
model? • How much do they cost? EXAMPLES • Personal assistance • Dedicated personal assistance • Self-service • Automated services • Communities • Co-creation
Customer Segments • For whom are we creating
value? • Wo are our most important
customers? • Mass market • Niche market • Segmented • Diversified • Multi-sided platform
Key Resources What key resources are required by our Value propositions Distribution channels Customer relationships Revenue streams TYPES OF RESOURCES Physical Intellectual Human Financial
Channels • Through which channels do our customer
segments want to be reached? • How are we reaching them now? • How are our channels integrated? • Which ones are most cost-efficient? • How are we integrating them with customer
processes? CHANNEL PHASES • Awareness - How do we raise awareness
about our products and services • Evaluation – How do we help customers
evaluate our value proposition? • Purchase – How do we allow customers
purchase specific products and services? • Delivery – How do we deliver a value
proposition to customers? • After Sales – How do we provide post-
purchase customer support?
Cost Structure • What are the most important costs inherent in the business model? • Which key resources are the most expensive? • Which key activities are the most expensive? IS THE BUSINESS MORE: • Cost Driven – leanest cost structure, low price value proposition, maximum automation, extensive
outsourcing • Value Driven – focussed on value creation, premium value proposition SAMPLE CHARACTERISTICS • Fixed costs • Variable costs • Economies of loading • Economies of scale
Revenue Streams • What value are customers really willing to pay for? • What are they currently paying for? • How are they currently paying? • How would they prefer to pay? How much does each revenue stream contribute to overall revenue?
TYPES FIXED PRICING DYNAMIC PRICING • Asset sale • List price • Negotiation/bargaining • Usage fee • Product feature dependent • Yield management • Subscription fees • Customer segment dependent • Real-time market • Lending/renting/leasing • Volume dependent • Licensing • Brokerage fees • Advertising
Business Model Canvass And Use Case Identification
• Locate each use case within the Business Model Canvass to understand its context and potential contribution to the business
• This approach provides an understanding of the benefits of implementing a use case and assists with their definition
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Identification Of High Potential Value Use Cases
• Select party or parties included in the use cases
• Select the objective such as sell more, improve service time, prevent customer loss, reduce cost of service, increase efficiency −Not all use cases can be implemented because of time, cost and
resource constraints
• Review use cases to identify those with the greatest potential
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Definition Of Use Cases
• Use the use case analysis to prioritise their implementation based on a balanced view
• Use cases must be viewed within the context of campaign management
• Use cases and their associated offers need to be understood as a whole so there are no gaps or inconsistencies
• You need to understand the impact of use cases on the organisation in areas such as increased workload and affect on revenue and margin
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Use Cases And External Party Journey Stages
• Depending on the nature of the organisation and the type of product/service supplied, external parties will interact differently −Once-off products
− Continuous services
• External party interactions will have a standard journey through processes/functions and exceptions/deviations from this “happy path”
• External party journey will differ depending on party type and the type of product/service supplied
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Core Processes and Process
Competencies
Mapping Uses Cases To Internal Process Competencies
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Business Customer
Retail Customer
Public
Service Provider
Dealer
Sub-Contractor
Agent
Regulator Supplier
Use Case Use Case Use Case
Use Case
Use Case
Use Case
Use Case
Use Case
Use Case
Mapping Uses Cases To Internal Process Competencies
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External Interaction Paths – Experience Use Case/Journey
Organisational Operational Process Competency Grouping
POA High Level Reference Architecture
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Reference Data Manager
Enter and Maintain Organisation and Process Reference Data
Process Creator and Mapper
Create and Maintain Definitions of Operational and Cross-
Functional Journey Processes, their Mappings and Their
Versions
Process Dashboard
Provide Role-Based Administration and Management Analysis and Reporting Access to Inflight and Historical Processes
Process Manager/ Operator
Allow Processes to Be Instantiated and Operated in
Response to Requests, Manage Notifications, Alerts and
Escalations
Process Library and Explorer
Maintain Library of Versions of Operational and Cross-Functional
Journey Processes and Provide Role-Based Access
Process Data Collector
Collect and Maintain Information on Instantiated Processes
Process Workbench
Provide Role-Based Access to Participants in Inflight and
Historical Processes
POA High Level Reference Architecture
• View of what is required to implement and operate a process oriented architecture and the operational components
• This requires: 1. Structured approach to identifying, categorising and structuring
internal organisational operational process competency groupings
2. Customer (external party) experiences journeys identification and definition
3. Mapping of experiences journeys to internal operational competencies
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POA High Level Reference Architecture Components
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Reference Data Manager
Process Creator and Mapper
Process Dashboard
Process Manager/ Operator
Process Library and Explorer
Process Data Collector
Process Workbench
Create Process Definitions – Cross-
Functional and Operational Mappings
Initiate Processes Based On Triggers, Allocate and Notify
Participants
1
2 Allow Processes to
be Viewed and Worked on By External and
Interval Participants
3 View Status of In Flight Processes
4
Collect Information on Inflight Processes
5
Dual View Of Processes
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Look For Information/ Awareness
And Interest
Generated
Look For Details on
Specific Product/ Service/
Offer
Receive, Evaluate
Offer, Negotiate
and Compare
Decide To Buy
Product/ Service
Pass Enrolment,
Buy/ Subscribe
and Receive
Product/ Service
Receive and Pay Usage
Statements and Bills
Query Usage
Statement and Bill, Pay Bill
Report Fault/
Complaint
Upgrade/ Buy
Additional Product/ Service/
Respond to Offer
Renew, Evaluate
Alternatives and
Negotiate
Decide to Leave/ Cancel Service
Accept Counteroffer
External View
Internal View
External Process View Step
Internal Process View Step
Process Oriented Architecture And Digital Transformation
• The object of digital transformation is the extension of internal processes to specific parties over specific channels outside the organisation
• When you extend business processes outside the organisation, you need to ensure cross-functional/cross-capability operation
• External parties are not concerned with process limitations caused by a siloed organisation not operating efficiently
• Process Oriented Architecture is a key enabler of successful digital transformation
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Summary
• A Process Oriented Architecture is a way of linking process areas to actual (desired) interactions – customer (external interacting party) service journeys through the organisation
• Allows two views of any process to be maintained and operated − External view – that experienced by user − Internal view – that worked on by the organisational competency
• There will always be two views of any process
• The complexity of internal organisational operational process competency groupings needs to be masked from the customer (external party)
• There are discontinuities and disconnections between the natural interaction sequence and the way the organisation responds to these interactions
• This leads to differences between customer (external party) expectations and what actually happens
• Process Oriented Architecture links organisation competencies to these contact and experience sequences and journeys − Enables end-to-end view, across cross functional and operational areas − It is the glue that bonds customer (external party) interaction sequences with operational processes and
structures − Enables straight through processing
• Process Oriented Architecture is a key enabler of successful digital transformation
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More Information
Alan McSweeney
http://ie.linkedin.com/in/alanmcsweeney
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