Insights into business process management bpm
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BPM Combines People, Process, and Technology to Improve Organizational Performance & Customer Value
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Insights into business process management bpm
- 1. Perficient Perspectives Insight into BPM September 22, 2011
- 2. About Perficient Perficient is a leading information technology consulting firm serving clients throughout North America. We help clients implement business-driven technology solutions that integrate business processes, improve worker productivity, increase customer loyalty and create a more agile enterprise to better respond to new business opportunities.
- 5. 2010 Revenue of $215 million
- 6. 20 major market locations throughout North America
- 7. Atlanta, Austin, Charlotte, Chicago, Cincinnati, Cleveland, Columbus, Dallas, Denver, Detroit, Fairfax, Houston, Indianapolis, Minneapolis, New Orleans, Philadelphia, San Francisco, San Jose, St. Louis and Toronto
- 10. 500+ enterpriseclients (2010) and 85% repeat business rate
- 11. Alliance partnerships with major technology vendors
- 15. Business Process & Workflow Consulting
- 16. Usability and UI Consulting
- 19. Package Selection, Implementation and Integration
- 20. Architecture & Application Migrations
- 22. Sales
- 23. Marketing
- 24. Training
- 27. Six Sigma CertifiedChange Management 5
- 28. Why Business Process Management (BPM)? BPM Combines People, Process, and Technology to Improve Organizational Performance & Customer Value Businesses need to respond quickly to constantly changing market conditions in order to survive and thrive Gartner believes “that 10 of the Global 2000 companies will be toppled in the next 3 years by overlooked but easily detectable process defects” 6
- 29. Wouldn’t It Be Nice If… Personnel could easily find process information in a format they want to use Once that information was found, it was accurate and up to date Business processes were owned by the Business Business units conducted business by following their processes The business could be transformed in a controlled manner, minimizing the potential impact from Chaos Theory* *Chaos Theory - the flapping wing of a butterfly represents a small change in the initial condition of a system, which causes a chain of events leading to a large-scale phenomena (Source Wikipedia) 7
- 30. Agenda Definition of BPM, Why We Use It, and Its Benefits BPM Delivery Approach Translation of Documentation into a Business Model Business Model Analysis Skills (not to include Six Sigma or Lean methodologies) Business Model Based Deliverables Defining Business Model Metrics and Measurements Organizational Change "There is no right way to do the wrong thing."-- Anonymous 8
- 31. What is Business Process Management? 9
- 32. BPM Definition Possibilities Business Process Management is an often used term with multiple definitions and purposes. To some it means automating a process To others a way of increasing efficiency Yet to others, a strategic way to align business processes to company strategies Which purpose is correct? 10
- 33. BPM Definition Possibilities Business Process Management is an often used term with multiple definitions and purposes. To some it means automating a process To others a way of increasing efficiency Yet to others, a strategic way to align business processes to company strategies Which purpose is correct? All of them are! 11
- 34. BPM Definition BPM is adisciplinedapproach that focuses on effectively and efficiently aligning all aspects of an organization, with the vision of constant process improvement, technological integration and increasing customer value. Business Models are comprised of: Activities (manual and automated) Information – inputs and outputs Roles and Technologies Business Process - Collection of related activities that produce a specific outcome aligned to a particular business purpose. A process is a story of what people do within their environment for an anticipated outcome. BPM is about transforming and improving the way an organization operates. BPM is a Continuous Improvement Endeavor 12
- 35. Reasons to Use BPM Be Prepared for Change Market Conditions Technologies Customers Design Business Processes to Increase Customer Value Design Business Processes that Include Strategic and Tactical Components Develop a Common Business Language Align Business Processes with Strategic Priorities Improve Business Performance Increase Revenue Reduce Costs Improve Stock Price If you can't describe what you are doing as a process, you don't know what you are doing.“ - W. Edwards Deming 13
- 36. Further Reasons to Use BPM Design Business Processes from an end-to-end perspective (not silos) Improve Market Flexibility and Agility Ensure Regulatory Compliance Integrate IT Applications and Systems Outsource or Redistribute Work Capture Institutional Knowledge How Can You Improve What You Don’t Understand? 14
- 37. Some Benefits of BPM(there are many more …) Increased Growth/ Revenue Increased Innovation and Agility Defined Key Success Metrics Aligned People, Process, and Technology Aligned Business Strategy with Business Processes IT Enabled Business Process Change Changed Organizational Culture 15
- 40. SurvivabilityPoor Management Visibility of Process Bottlenecks Slow Process Change in a Dynamic Marketplace is an opportunity for disaster Gaps between Business Process & IT 16
- 41. BPM Delivery Approach 17
- 42. Perficient’s BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 18 Organizational change occurs throughout the entire BPM approach – it is not a one time activity at the end of a project
- 43. BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 19
- 45. We have a “Cowboy” or “Firefighter” mentality here
- 46. Miscommunication/ no communication with Business (IT is held accountable for business process success/ IT project implementation)
- 47. Can’t get requirements correct, missing or confusing requirements
- 48. Lack of Subject Matter Expert (SME) participation, business won’t work with us or do not appear to take ownership of their processes
- 49. Planning on outsourcing some of our business functions
- 50. Aging work force, we are losing critical knowledge that is not well documented
- 51. We spend too much time looking for information
- 52. Success metrics/ measurements not defined
- 53. If the response to any question regarding BPM is “That is a Good Question”20
- 54. Process Immaturity Symptoms Customer Complaints are Rising Profits Going Down, Losses Going Up Costs are Increasing Quality is Declining Customers are Leaving Seem to be Behind the Competition Lack of Innovation Survival Mentality Instead of Prospering * Source: ABPMP – Introduction to BPM 21 1. Define Business Problem
- 56. Business initiative and IT won’t buy in
- 59. Project Objectives are the intended outcomes of the efforts of the project22 1. Define Business Problem
- 60. BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 23
- 61. 2. Determine Scope & Complexity Scope Create a Draft Activity Model with the Project Sponsor or Subject Matter Experts (SMEs). Identify the Process Owner if possible at this point. Activity Model is a Hierarchical decomposition of Activities Aligned to a Business Purpose Mind Map is a diagram that represents processes and tasks or other items linked to a central key idea 24
- 64. SME Availability for Workshops
- 66. Reduction of $xxx or xx%25
- 74. Not part of the organizations culture
- 76. Assess cost of moving to a higher BPM level26
- 78. Market Influencers – local, national and global markets (assess the offerings of your competitors)
- 79. Technology Influencers – social media, cloud technology
- 80. Corporate and Department Vision, Strategies and alignment to the Business Process
- 82. Inefficiencies with Current Process
- 83. Benchmarking27 2. Determine Scope & Complexity
- 86. Glossary
- 88. Use Cases
- 89. Quick Wins
- 90. Recommendations
- 92. Presentations
- 93. ReportsDeliverable Format (Paper vs. Electronic) 28 2. Determine Scope & Complexity
- 95. Estimate of the QA Time (% of Project)Determine Client Source Document Types & Availability Define Business Model Assumptions Define SME Assumptions Define Project Facility Assumptions * Assumptions may impact the scope, timeline, deliverables and ultimately the cost of the project. Documenting the assumptions provides the baseline to estimate the project cost and manage scope of the project 29 2. Determine Scope & Complexity
- 97. Information
- 98. Roles & TechnologiesEstimate Consensus State Analysis Methodologies Estimate Desired State Estimate Deliverable Prep & Delivery Estimate the Return on Investment (ROI) Estimate the Size of the BPM Team 30 2. Determine Scope & Complexity
- 99. Estimated %, Actual Projects will be Individually Estimated 31 2. Determine Scope & Complexity Where Should I Spend my BPM Project Time?
- 100. Prepare Project Documentation Prepare Presentation Prepare Proposal Present to Client 32 2. Determine Scope & Complexity
- 101. BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 33
- 103. Word Documents
- 104. Excel Spreadsheets
- 105. Procedure ManualsBuild out Consensus Straw Model Validate the Consensus Business Process and Capture Pain Points/ Opportunities with Subject Matter Experts (SMEs) Model the Consensus State Business Process to a detailed enough level to capture pain points (inefficiencies) / and create a solid baseline to support organizational change We need to challenge assumptions on how we do business in order to make significant improvements -- anonymous 34
- 106. BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 35
- 107. 4. Analyze “Consensus State” to “Desired State” Perform Consensus State to Desired State Analysis Simulation – analyze bottlenecks and inefficiencies for improvement opportunities Market Influencers – local, national and global markets (assess the offerings of your competitors) Technology Influencers – what technologies can be leveraged to increase improve the targeted business process Corporate and Department Vision, Strategies and alignment to the Business Process Regulatory Influencers - what regulations could impact the to-be process design Inefficiencies with the current process Apply Lean/ Six Sigma methodology Benchmark other companies and industries to define potential best practices Determine if any industry frameworks can be leveraged ITIL (Information Technology Infrastructure Library) COBIT (Control Objectives for Information and Related Technology) APQC (American Productivity and Quality Center) 36
- 108. BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 37
- 109. 5. Develop “Desired State” Model Create Desired State Scope Statement for the design and identify any constraints Develop Desired State business model with key Business SMEs, Customers and Stakeholders Define Metrics for the Desired State Process (how you define success) Redesign before you Automate 38
- 110. 5. Develop “Desired State” Model Finalize and Deliver BPM Project Finalize Project Deliverables QA Project Deliverables Present Project Deliverables Obtain Sign-Off on Project 39
- 111. BPM Approach Define Business Problem Determine Scope and Complexity Document “Consensus State” Model Analyze “Consensus State” to “Desired State” Develop “Desired State” Model Support and Communicate Organizational Change 40
- 112. 6. Organizational Change Definition - Change management is a structured approach to shifting/transitioning individuals, teams, departments and organizations from a current state to a desired future state. * Source Wikipedia Change management must involve people, not be imposed on people 41
- 113. 6. Organizational Change (cont.) Change Management Process Create Tension – Articulate why change needs to happen and why it needs to happen within the planned timeframe Identify Key Stakeholders, Identify Disposition & Harness Support – get on board the key decision-makers, resource holders and those impacted by the change Articulate Goals – Define in specific and measurable terms the desired organizational outcomes Nominate Roles – Assign responsibility to specific individuals for the various tasks and outcomes Grow Capability – Build organizational systems and people competencies necessary for affecting the change Entrench Changes – Institutionalize the change and make it “the way we do things around here” Source: www.businessperform.com 42
- 114. Why Perficient? 43 The Trade-offs Between Internal & External Resources
- 115. Why BPM? In order to provide a common understanding of a process, we must understand other perspectives. 44
- 116. Q & A
- 117. Follow Perficient Online Perficient.com/SocialMedia Daily unique content about content management, user experience, portals and other enterprise information technology solutions across a variety of industries. Twitter.com/Perficient Facebook.com/Perficient
- 118. “Simplicity is the ultimate sophistication.” Leonardo da Vinci “I put my heart and my soul into my work, and have lost my mind in the process.” Vincent van Gogh 47
Editor's Notes
- Also a great supporting attribute of Customer Value is shareholder value, if Customers are happy, they will buy more products and services and if processes are efficient, this will result in increased profits and increase stock value and dividends.The customer values whatever the customer thinks is worth paying for, so if the customer won’t pay for something, it is waste that you can eliminate.
- 8 in 10 senior executives expect the level of business complexity to increase over the next five years, fueled by volatile market conditions, multifaceted customer and partner relationships, rapidly changing business processes, and more advanced technologies. – source – “The Top 10 Business, Process, And Technology Trends Impacting Business Process Pros In 2011 – Forrester Research Inc.Process and data governance efforts are aligning. Typically they have been siloed efforts, with limited if any collaboration. With business taking an increased role in processes and process automation, these silos will soon begin to evaporate.
- As organizations become more complex, the rules under which they operate become more complex too. As some point, leaders need to recognize the situation and redesign old processes or create new process to return to a state of being more efficient, agile, flexible, etc. very similar to the “big bang theory”.BPM also established a common language for process transformation, focusing on 2 key areas:Replace requirements gathering with process modeling – most stakeholders and developers rarely read requirements documents, yet the thickness of a Business Requirements Document (BRD) is a key metric of success. Replace the traditional method of gathering requirements with business processes to capture and scope key business functionality to be analyzed for automation or software support.
- All of these are a result of focusing on improving business value outcomes, not solutions. Again, the key focus is improving Customer Value.
- Five common weaknesses are:Very few processes were formally identified and mapped.The majority of operational knowledge was tacit, held in people’s heads.There was no common process governance model, which led to large variations in the way processes were managed and ultimately in the types of services and deliverables customers received.Lack of common processes perpetuated uncommon performance measures, making it difficult to track, compare, and monitor process performance across Operations.Lack of visibility into the day-to-day workload made it extremely difficult to provide resource leveling.
- Core processes are the key activities an organization performs in order to make money and satisfy customer needs. These processes are what typically separates the organization from their competitors. Support (enabling) processes, such as IT, HR, etc. support the primary business activities, in other words, support processes are not what the Customer comes to the organization for.
- Examples of business goals are:Improve productivity by 25% and/or reduce headcount by 25% and or reduce overtime by 10%Enhance transparency of process tasks, workflows, and measures across all levels of management and staff.Move the organizational culture into one focuses on process improvement as a key value creator by training and involving all staff members in the work.
- Regardless of BPM maturity, the BPM methodology will work.BPMM – ABPMP maturity model – 5 levelsLevel 1 – Initial - InconsistentLevel 2 – Managed – work unit managementLevel 3 – Standardized – process managementLevel 4 – Predictable – capability management Level 5 – Innovating – change management
- What are some assumptions?
- We all have our perspectives when we look at a processCritical advantage of BPM is to look at a process, you can see other’s perspectiveWe capture all perspectivesFor example, in the pictureOld woman2 trees that form an arch2 mouse-like characters