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BPM Standards and Technology
Understanding tool options, identifying technical requirements, establishing selection approach, and making the final choice
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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
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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) BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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) BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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. BA 553: Business Process Management
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BPM Technology Selection Example
Example from a project I worked on: 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 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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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Example Executive Process Dashboard
accessed 3 March 2010. BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 BA 553: Business Process Management
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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 accessed 3/14/15. BA 553: Business Process Management
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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 BA 553: Business Process Management
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