Edith Cowan University

School of Business and Law

Online Exercise - Semester 1 2020

Online Exercise Details (50% of overall assessment covered by this online exercise)
Unit Code: MAN6910
Unit Title: Business Process Management
Date: 16/6/2020
Duration: 4 hours (13:00-17:00)

Student Details Student to complete

ID:
Surname:
Given:

Online Exercise Instructions

1. Students are required to download this exercise from MAN6910’s Blackboard shell
Assessment -> Online Exercise
2. Students are required to type or paste your answers within this document
3. Student are required to upload your completed Online Exercise to MAN6910’s Blackboard shell on
16/6/2020 (between 13:00 and 17:00)
Assessment -> Online Exercise

*PLEASE SAVE YOUR WORK REGULARLY (IDEALLY ON A NETWORK DRIVE) TO AVOID ANY UNFORSEEN
CIRCUMSTANCES!

Materials Allowed
PC/Laptop: Yes
Calculators: Yes
Books: Yes
Drawing Tools: Yes
Smart Phones: Yes
Writing Instruments: Yes
Dictionary: Yes

Answer all Questions

Question 1. (2 Marks)

Provide an example to demonstrate how business process management can be used to improve
business performance.

Improving business processes, for instance, can dramatically reduce costs within a organization.
Duplicated work is quickly identified and redundant tasks are avoided through the structure and
visualization. Efficiency and intelligence is allocated to resources that improve processes and
spend less. With the use of software to improve business processes in a large company millions of
dollars can be saved.

The contact inside an organization is another example of improving business processes. With
interactive software available for all areas, BPI reduces the number of emails that are sent
between individuals and departments. All will see and exchange information and be confident it
won't be lost in a mailbox.
Question 2. (12 Marks)

Model the following business process using BPMN 2.0 specification.

An online order handling process starts when an order is received. A customer service agent
registers the order. If the current date is not a working day (Saturday, Sunday or any public holidays)
for the customer service department, the process waits until the following working day before
proceeding. Otherwise an availability check is performed and a purchase order response is sent back
to the customer. If none of the products is available, any processing related to the order must be
stopped. Anytime during the process, the customer may send a pick-up order cancel request. When
such a request is received, the order handling process is interrupted and the cancellation is
processed.

A SMS is sent to the customer if the following things happen:

1. Order cannot be filled because one or more items in the order are not in stock.
2. An item that they have ordered is not available but a similar item that is more/less
expensive than the unavailable one is available.
3. The credit card is not valid.

When the order is ready, a SMS is sent to the customer to inform the delivery date and time.
Question 3. (6 Marks)

A new staff on-boarding process starts when a new employee arrives at the office. The staff then
needs to complete a “New Hire Reporting form” and submit to a HR executive. The form submitted
is checked for completeness by the HR executive. The new staff is asked to make corrections if there
are mistakes with the information provided, otherwise the following two activities are taking place
simultaneously.

- The facilities coordinator is responsible for providing an office for the staff. If an appropriate
office is available, a key is given to the staff. If no appropriate office is available, a
workstation is temporarily assigned to the staff.

- The HR executive enters the staff’s data into the HR system. After 48 hours, the HR system
automatically produces a benefits package. The benefits package is then sent to the staff.

Once these two activities are completed, the external HR recruitment agency is notified that the new
staff on-boarding process has been completed.

The following BPMN model is developed based on the above case study.
New Staff

Complete New
Hire Reporting Make
Form corrections
New staff
arrived

Has mistake(s)
HR Executive

Enter staff Generate

Organisation

Check for Send benefits

Has no mistake data in HR benefits
completeness package
System package
After 48 hours
Facilities Coordinator

Check offi ce Provide

Assign office
availability office keys
Assign
workstation

No appropriate
office available Completion notification Sent
Recruitment
Agency
HR

The BPMN model has three problems. What are they?

Problem 1: There is no contract signing process exists which is against of company culture.

Problem 2: No need of Assign workstation.

Problem 3: Generate benefit package takes more time. It can be reduced.

Question 4. (6 Marks)

Control charts can be used to prevent two types of errors: special cause of variation and common
cause of variation. Which type of error best describes the error demonstrated in Figure 4a and 4b?
Justify your answers.

Figure 4a Figure 4b

Figure 4a describes common cause of variation error because fluctuation caused by unknown
factors is the common cause of the variation, which results in a steady but random output
distribution around the average data. A calculation of the process capacity or how well the
process can be carried out if differences in the specific cause are excluded.

Figure 4b describes special cause of variation error because a shift in output caused by a certain
factors such as environmental conditions or process input parameters is a special cause variation.
It can be taken into account explicitly and theoretically and is a process management tool.
Verification of Identity

Take a selfie (using your smartphone) showing your smiling face together with your student ID card
in front of the computer that displays the online exercise screen

Paste your picture here.

Question 5. (12 Marks)

Draw a Pareto Chart corresponding to the below data generated from the supermarket pick-up
order fulfillment process:

 In a very small number of cases, a pick-up order cannot be filled because one or more items
in the order are not in stock. The supermarket then tries to call the customers but if they are
unreachable, then they only learn this when they come to pick up their order. The
probability that this customer will not come back after this experience is 5%.

 In a small number of cases, when customers arrive to pick up the orders, they find out that
they have to pay more than what they expected because an item that they have ordered is
not available. The supermarket then tries to call the customers if they would allow a similar
item but is more/less expensive than the unavailable one. Sometimes, however, the
customers are unreachable, then they will only find out they arrive the supermarket. The
probability that this customer will not come back after this experience is 40%.

 In a very small number of cases, a pick-up order is cancelled if their credit card is not valid.
The supermarket then tries to call the customers if they would provide a valid one.
Sometimes, however, the customers are unreachable, then they will only find out they arrive
the supermarket. The probability that this customer will not come back after this experience
is 10%.

 Oftentimes, especially during peak time, customers have to wait for more than 10 mins to
pick up their order due to queues. Customers find this annoying and the supermarket should
do something to avoid such queues at pick-up. The probability that this customer will not
come back after this experience is 15%.

 Sometimes the customer arrives at the scheduled time, but the order is not yet filled due to
delays in the pick-up order fulfillment process. The probability that this customer will not
come back after this experience is 20%.

When making assumptions to analyse these issues, you may choose to equate “oftentimes” with
“20% of orders”, “sometime” with “5% of orders”, “small number of cases” with “2% of orders” and
“very small number of cases” with “1% of orders”. You may also assume that the supermarket serves
200,000 pick-up orders a year and that the annual revenue of the supermarket attributable to pick-
up orders is $25 million. You may also assume that on average a customer makes 4 pick-up orders
per year.
 Complete Shipment

Delivery Problem
Late Delivery

Reason of Late Delivery

Question 6. (10 Marks)

Calculate the Cycle Time (CT), Theoretical Cycle Time (TCT) and Cycle Time Efficiency (CTE) based on
the following BPMN 2.0 model.

Quote rejected
Estimate
budget

Reject
Project Manager

Quote
(20%)

Evaluate Accept Prepare

Estimate Prepare Submit
project Quote project
time quote quote
profitability (80%) plan
IT Service Provider

Request for Quote

quote received submitted

Estimate
risk
Management Office

Yes
(90%)
Head of Project

Approve
No (10%) quote

Activity Cycle Times Processing Times

Evaluate project profitability 2 days 3 hours

Prepare project plan 3 days 5 hours

Estimate budget 2 days 3 hours

Estimate time 3 days 6 hours

Estimate risk 2 days 3 hours

Prepare quote 1 day 2 hours

Approve quote 1 day 1 hour

Submit quote 1 day 1 hour

CT = T1+T2+…+TN = 15 days

TCT= 24 hours

CTE= TCT/CT = 24/15 = 1.6

Question 7. (2 Marks)

Why are reference models (e.g. Information Technology Infrastructure Library) important?

ITIL is an IT service management model developed by the UK Government which defines an end-
to - end life cycle and an integrated set of practices and guidance in the fields of service strategy,
service design, transition, services and ongoing improvements in service. In the sense of ITIL, the
phrase "a way to deliver value to consumers by helping customers achieve results without control
of unique costs and risks" implies that results arise from the execution of processes or activities to
accomplish a particular goal or produce specific outputs. Although ITIL covers many of the same
business areas and processes as other governance and control frameworks, ITIL is distinguished
from COBIT, ISO and most IT management frameworks by its service orientation. Presentation by
auditors and those working with ITIL organizations should understand that their service oriented
perspective impacts on the essence of, and the best solutions to, ITIL audits in these
organisations: the comparison of processes and IT management systems is outside the reach of
this book. ITIL has undergone many significant revisions since its initial production over 20 years
ago, first using numerated versions and now defined by the year in which updates are released.
ITIL 2011 is the most recent version, although the core structures of the framework have been the
same since ITIL v3, although it is common to refer to ITIL v3 and ITIL 2007 (both designations refer
to the same version). The ITIL paradigm describes a life cycle consisting of the five main activities
shown in the figure. ITIL describes main processes and operations, their inputs and outcomes and
their positions and obligations in the efficient implementation of these processes at any step of
the service life cycle.