Chapter 1 – Introduction to BPM
1.1 A More Integrated Approach to BPM?
BPM or at least truly successful BPM involves consideration of at least six different dimensions of process.
1) The Technology, Systems Architecture dimension, heavily focussed on, and relating to, the role of technology in process.
2) The Documentation/activity/logic driven dimension, driven by techniques such as process flowcharting, business and workflow analysis.
3) The Operational, and/or people driven dimension, understanding that in the demographic considered in this material, people perform many/most/all of the activities, and not machines, computerized or otherwise.
4) The Business or Service dimension, recognizing the processes lead into, originate from, or are a part of a much larger business goal, that of satisfying customer, client or stakeholder needs, and in the private sector, we can add the work profitably.
5) The Performance dimension, which is how the design, structure and operation of the process performs in terms of costs, productivity and an array of performance parameters, a topic I find under exposed.
6) The Organization, Structural and cultural dimension, which is concerned with how the structure, culture and nature of the organization facilitates and supports the business processes. ( Or not!)
BPM becomes really successful when all six dimensions are considered & addressed concurrently. That is;
a) Appropriate technology is selected and implemented, creating a platform and environment on which enables the organization to develop successful process solutions to meet customer and stakeholder needs.
b) The logic of the process flow makes sense, is rational, sound, and is logically the best way to achieve the stated objectives of the process.
c) The operational and/or people issues involved in how the process actually runs in reality are considered in the design and operation of any new process.
d) Business issues such as overall customer/client/user experience are considered and incorporated into the analysis of the current process and development of any proposed solutions for improvement.
e) The performance of the process is maximised or optimized according to factors such as cost, productivity, and time, and that the process performs as desired.
f) Organizational, structural, and cultural aspects of the organization align with and support the goals of the business processes.
Many approaches to BPM that are focused around one dimension usually ignore the other(s) at their peril. In many environments, IT groups become the source for development of business process by default, and consequently tend to be very good at developing very logical, rational uses of technology and processes that flow from the use of it.
Even today, many large IT functions continue to attempt to deploy systems designed entirely from a technological perspective on to a reluctant or recalcitrant group of business users. Technology solutions are conceived, developed and then imposed onto user groups often with only very limited real input from the users as to the design and operation of the proposed future process. “Sign-off” does not necessarily indicate total acceptance. Consequently, the alignment of processes developed in this fashion, with the business realities faced by line managers or operating staff can often be somewhat less than desired.
Even with the best possible flowcharting, the logic of the process flow isn’t always the same as the logic of the business or operational situation, or the thought process of users as to how best to accommodate and/or accomplish broader business and/or operational objectives with the process. Consequently, many IT inspired process changes are often poorly designed and/or poorly implemented due to failure to meet business needs and/or a lack of understanding of operational issues, considerations and organizational and people limitations. Traditional business analysis and systems development methodologies have tended not to incorporate these kinds of considerations into process design and implementation. Consequently, the reasons why many systems turn-ups fail, is often not because of the nature of the process design, but rather the operational, people, business, organizational, and structural aspects that are critical in ensuring successful implementation.
Another neglected element in BPM is discussion around the fact that in most service industries, broader public sector financial services & Small to Medium Sized Enterprises (SME) environments, nearly all processes involve people. That is they are “people paced”. This means that people drive the process, and the process is as productive and effective as the people in it make it. This is distinct from being ‘machine paced” more common in manufacturing and automated environments, where the process performance is driven by a production line or machines. We will discuss a lot of people issues as they relate to BPM. Once people are thrown into the mix, things can change. Now we have to consider motivations and people performance issues.
One of the unique features of this e-book will be extensive consideration and discussion around process performance in terms of how we maximise or optimize process key performance indicators or KPI’s and process measures based on parameters such as cost, quality, speed etc. This dimension of process performance is rarely extensively covered by any of the texts I have seen so far. This feature is about how end to end process performance, which ultimately drives everything related to the customer/client/end user experience with the process, is created by the parameters of the process itself.
Further, the reader demographic this material was oriented at, will be readers in primarily service industries, the broader public sector (BPS), financial services & small to mid-sized enterprises, (SME) environments, rather than the manufacturing focus of some BPM approaches, which managers in industries or verticals outside of manufacturing, usually find hard to adapt to their own situations.
Finally, processes are profoundly influenced by organizational, structural, and cultural issues. Frequently, these may be responsible for defining and/or limiting the performance of the processes, every bit as much as any process parameters we will discuss, so this e-book will feature discussions of these issues, and their subsequent effect on process at many junctures.
The kind of BPM we will discuss here is essentially BPM from an operations or business managers’ perspective. It involves both physical and information processes. Physical process involves not only people as we have discussed, but also assets such as facilities, real estate, materials (raw materials, work in process (WIP), and finished goods), mobile assets such as vehicles, etc. essentially physical entities. Information flow transects all of the above, but does not explain the totality of what BPM involves, and what is going on outside the strict confines of the information and data flow inside the organizations management information systems. It is my objective that this material contained in this e-book will address these issues and bridge these gaps. Finally, in addition to providing many details on what BPM is, I will end this e-book with a general overview of a “how-to” approach on the tactical practical details of how to improve process performance by applying BPM within the framework of a general process improvement initiative in its broadest scope and most general sense. This is the distillation of about 2 to 3 people centuries of practical best practices of process change. I hope you enjoy it.
Before closing this section I would like to mention what this e-book does NOT include. It does not include any specific steps required to design, build and operate specific common processes. It does not discuss the best design for an accounts payable process, the best way to create a payroll system, the best way to define and measure employee performance. These can of course all be excellent arenas for specific applications of BPM concepts, but the specific processes themselves will not be discussed. Rather, the content is deliberately designed to be completely generic; it will apply to almost every process.
What this book WILL do however is tell the reader how to measure, analyse, evaluate and improve such processes as those mentioned above from the perspective of process performance, productivity and costs. If that is the reader’s goal, the reader is in the right place!
Each chapter contains one or more case studies in aspects of BPM from my own experiences. These case studies are designed to highlight how to apply specific aspects of BPM in specific situations. All the case studies are heavily disguised to protect client confidentiality. They do however all represent real process situations.
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