Chapter 7 Business Process Management Organizations use business process management (BPM) to manage their business processes, which

h are activities that create values by transforming inputs to outputs. The BPM cycle involved four steps: Step 1: create an AS-IS (current situation) model for each business process Step 2: create system components (hardware, software, data, procedure, people) for the processes Step 3: implement processes Step 4: access business processes for effectiveness Since business processes tend to change very often, organizations need to keep the BPM cycle going so they could modify those processes to adapt to changes that are expected to occur.

Business processes can fall into one of the following three categories:

Functional processes involve activities within a single business department or function. The BPM is easier to accomplish because the authority for making changes and resolve problems belong solely to the department manager. However, functional processes usually lead to low productivity and inefficiency because since business departments work independently from one another, the information collected from one department might mismatch or have no use to another department. Cross-functional processes involve activities that cross into multiple departments within an organization. Since these processes integrate the activities of several departments together, the problem of isolated system or data can be minimized. Examples of cross-functional processes are customer relationship management (CRM) and enterprise resource management (ERP) Interorganizational process involves activities that cross into multiple companies. Ex: supply chain management (SCM)