If you love diagrams!

Slide 1
Purchasing process at Ford at the initial stage

Slide 2
Purchasing process at Ford after redesign

Rise of BPR
- Focus entire end-to-end processes
- Think holistically
Slide 3
- Think Big, radical
 Purchasing process at Ford
Consider the purchasing process at Ford.
1. Who are the actors in this process?
2. Which actors can be considered as customers in this process?
3. What value does the process deliver to its customers?
4. What are the possible outcomes of this process?

Slide 4
 The Rise and Fall of BPR
1. Concept misuse:
• Projects were labeled BPR, even when business processes were not the core.
• Many corporations initiated reductions of workforce, often packaged as process
redesign projects, which triggered resentment.
2. Over-radicalism:
• Hammer’s early papers states: “Don’t Automate, Obliterate”.
• Many situations require a much more gradual (incremental) approach.
3. Support immaturity:
• Necessary tools and technologies were not yet available or insufficient.
• Much process logic had to be hard-coded in IT applications of the time.
• People grew frustrated when they noted that their efforts on redesigning a process
were thwarted by a rigid infrastructure.

ContinuousNext is the Formula for Success through Digital Transformation and Beyond
(Gartner, 2019)
Slide 5
Reshaping Process Thinking
ERP Systems penetrate the
Process Orientation is productive
market

Slide 6
 Improving Performance (Rummler’s
Framework)
Business Environment
Economy Regulatory Culture

Assets & Organisation

Resources
Performance Planning Performance Management Stakeholders
Financial

Value
Human Function A Function B Function C
Resources
Business Process
Technolog
y Business Process Customers
Materials
Business Process

Competitors
7
Process performance
If you had to choose between two services, you would typically
choose the one that is:

Time
• Faster There is one more!
• Cheaper Cost
• Better Quality

45% of Product Launches Are Delayed by at Least One Month (Gartner, 2019)
 How would you improve the process performance

Customer Greet & Take Bring Serve Present Issue Customer

arrived seat order menu meal bill invoice paid

9
 How would you improve this process?
Outsource to Customer Standardize
Eliminate Cooking

Automate

Invest and Build

Re-sequence

Eliminate Waiters

10
Business Process Management (BPM)
Body of principles, methods and tools to design, analyze,
execute and monitor business processes, with the aim of
improving their performance.

IT systems
Customers Employees

Business
Processes
Data Trading
Partners

IT infrastructure Suppliers

11
In other words…

Information Yields
Technology Business
Value

Enables
Yields
Process
Change

Index Group (1982)

12
The BPM lifecycle
Process
identification

Process
Process architecture
architecture

Conformance
Conformance and
and Process As-is
As-is process
process
performance
performance insights
insights discovery model
model

Process
monitoring and Process
controlling analysis

Executable
Executable Insights
Insights on
on
process
process weaknesses
weaknesses and
and
model
model their
their impact
impact

Process Process
implementation To-be
To-be process
process redesign
model
model

13
Process architecture
A water supplier example

Management
processes

Core
processes

Support
processes
14
Process portfolio
Primary focus
High
F

D E T

C G W Z

I K A N

H P U V X

B J Y M R

L O
Low
Poor Good

0 Process Health 4

15
The BPM lifecycle
Process
identification

Process
Process architecture
architecture

Conformance
Conformance and
and Process As-is
As-is process
process
performance
performance insights
insights discovery model
model

Process
monitoring and Process
controlling analysis

Executable
Executable Insights
Insights on
on
process
process weaknesses
weaknesses and
and
model
model their
their impact
impact

Process Process
implementation To-be
To-be process
process redesign
model
model

16
Business process model
Invoice handling example
Finance ERP Invoice Report Invoice
Department
Enter Check
no
Invoice Invoice Post Invoice
mismatches
Invoice Details Mismatches
Invoice
received posted

Invoice DB Invoice
Senior Finance Officer
mismatch Block
exists Invoice
Invoice
blocked

17
Process model for the initial fragment of the
equipment rental process

Slide 18
 Construction Company BuildIT
Consider the Construction Company BuildIT.
• Taking the perspective of the customer, identify at least two performance measures that
can be attached to this process.
• Taking the perspective of the customer, think of at least two issues that this process might
have.

Slide 19
The BPM lifecycle
Process
identification

Process
Process architecture
architecture

Conformance
Conformance and
and Process As-is
As-is process
process
performance
performance insights
insights discovery model
model

Process
monitoring and Process
controlling analysis

Executable
Executable Insights
Insights on
on
process
process weaknesses
weaknesses and
and
model
model their
their impact
impact

Process Process
implementation To-be
To-be process
process redesign
model
model

20
Qualitative process analysis
Root-cause analysis example

21
Quantitative process analysis
Process simulation example

22
 Construction Company BuildIT
Consider the Construction Company BuildIT.
• Taking the perspective of the customer, identify at least two performance measures that
can be attached to this process.
• Taking the perspective of the customer, think of at least two issues that this process might
have.
• What possible changes do you think could be made to this process in order to address these
issues?

Slide 23
The BPM lifecycle
Process
identification

Process
Process architecture
architecture

Conformance
Conformance and
and Process As-is
As-is process
process
performance
performance insights
insights discovery model
model

Process
monitoring and Process
controlling analysis

Executable
Executable Insights
Insights on
on
process
process weaknesses
weaknesses and
and
model
model their
their impact
impact

Process Process
implementation To-be
To-be process
process redesign
model
model

24
Process redesign
AS-IS process model TO-BE process model

Cost

Time
Flexibility

Quality
25
The BPM lifecycle
Process
identification

Process architecture
Process architecture

Conformance and
Conformance and Process As-is process
As-is process
performance insights
performance insights discovery model
model

Process
monitoring and Process
controlling analysis

Executable
Executable Insights on
Insights on
process
process weaknesses and
weaknesses and
model
model their impact
their impact

Process Process
implementation To-be process
To-be process redesign
model
model

26
Process implementation
Process Process change
automation management

Executable
Job redesign
process design

Configuration
Training
& coding

Performance
Testing management
plan

... ….
27
 The BPM lifecycle
Process
identification

Process
Process architecture
architecture

Conformance
Conformance and
and Process As-is
As-is process
process
performance
performance insights
insights discovery model
model

Process
monitoring and Process
controlling analysis

Executable
Executable Insights
Insights on
on
process
process weaknesses
weaknesses and
and
model
model their
their impact
impact

Process Process
“Every good process eventually becomesTo-be
implementation a bad
To-be process
process
process”
redesign
model
model Hammer

28
Process monitoring & controlling
Dashboards, alerts & reports

Event Model-based analytics (p. mining)

stream
DB logs

29
Roles in the BPM lifecycle
DISCUSS:
Process Process Analyst vs Domain
identification
BPM group Expert
Process
Process architecture
architecture

Conformance
Conformance and
and Process As-is
As-is process
process
performance
performance insights
insights discovery model
model

System Process Process

Process
administrator monitoring and owner
analysis
Analyst
controlling

Executable
Executable Process Insights
Insights on
on
process
process participants weaknesses
weaknesses and
and
model
model their
their impact
impact

Process Process
Developer
implementation To-be
To-be process
process redesign
System model
model
Engineer 30
Job Functions of Process Owner

Slide 31
• What is Business Process Re-engineering, and journey towards Business Process
Management
• Outcomes of each step in Business Process Management Lifecycle

Slide 32
 Related Disciplines
• Total Quality Management (TQM)
• Focus on continuously improving and sustaining the quality of products and services.
• TQM puts emphasis on products and services themselves, while BPM focuses on
improvement of processes.
• Applications of TQM are primarily in manufacturing
• Operations Management
• Concerned with managing physical and technical functions of organization, particularly
those relating to production and manufacturing.
• Using probability theory, queuing theory, decision analysis, mathematical modeling, and
simulation for optimizing efficiency of operations.
• Such techniques are also adopted by BPM.
• Often concerned with controlling an existing process, while BPM making changes to an
existing process in order to improve it.

Slide 33
Related Disciplines
• Lean
• Originates from manufacturing, in particular Toyota Production System.
• Eliminates waste, i.e., activities that do not add value to the customer.
• BPM puts more emphasis on use of information technology as a tool to improve
business processes and to make them more consistent and repeatable.
• Six Sigma
• Originates from manufacturing, in particular from production practices at
Motorola.
• Focuses on minimization of defects (errors).
• Strong emphasis on measuring output of processes, especially in terms of quality.
• Popular approach to blend Lean with Six Sigma, leading to Lean Six Sigma.

Slide 34
Knowing the BPM Players
• Intelligent Business Process Management Suite
• Integrated set of technologies that coordinate people, machines and things. An iBPMS allows
“citizen developers” — most commonly business analysts, but also business end users — and
professional developers to collaborate on the improvement and transformation of business
processes.
• They also allow new, emergent practices to quickly scale across a function or enterprise
• A type of high-productivity (low-code/no-code) application development platform

• An iBPMS allows organizations to:

• Manage the reinvention of existing business processes and the creation of novel business
processes in support of both digital optimization and digital transformation efforts
• Support top-down and bottom-up redesign of its business operations and processes
• Improve the business outcomes of all types of work, not just structured and repeatable
• business processes

35
Bizagi
• The Bizagi Digital Business Platform is an iBPMS that offers execution
on .NET and Java Platform Enterprise Edition (JEE)
• Approaches the market in a disruptive way, through a deep focus on ease of
use and a freemium business model.
• With its Digital Business Platform, Bizagi has demonstrated higher-process IQ
capabilities

36
Case Study
Pharmacy service implementation at CVS

• Case Questions
• Is it order-to-cash, procure-to-pay, fault-to-resolution, application-to-approval, or
issue-to-resolution
• Who are the key actors of the process?
• Who is/are the customer(s)?
• What are the tasks of this process?
• What value does this process deliver to its customer?
• What are the possible outcomes of this process?
• Taking the perspective of the customer, identify at least two performance
measures that can be attached to this process.
• Taking the perspective of the customer, think of at least two issues that this
process might have.
• What possible changes do you think could be made to this process in order to
address these issues?

37
Session 2: Process
Identification
Things which matter most…
…must never be at the mercy of things which matter the least
Said Who?
Session 2: Process Identification
Layout of the Session
1. Session 1 – Recap
2. Origins and History of BPM, BPR
3. Knowing the BPM Players
4. The Context of Process Identification
5. Definition of the Process Architecture
1. Process Categories
2. Relationships Between Processes
3. Reuse of Reference Models
4. Process Landscape Model
5. The Example of SAP’s Process Architecture
6. Process Selection
1. Selection Criteria
2. Process Performance Measures
3. Process Portfolio
7. Case Discussion
1. Class Exercise
8. Recap
9. Readings and Assignment for the Next Session

SEITE 39
 Process Identification in the BPM Lifecycle

Management Processes

Process Define Vision Develop Strategy Implement

Strategy
Manage Risk

les for BPM lifecycle and process mining identification Core Processes

Procure Procure Market Deliver

Manage
Customer
Materials Products Products Products
Service

35h B 30h Support Processes

15h Process architecture Manage Personnel

Manage
Information Manage Assets

A E
D
5m 3m 5m 10m 30m 2h 10m
Process Portfolio
15m
C
1.5h 10min
Conformance and Process As-is process
performance
discovery model
insights

A B C D E

Process Process
monitoring analysis

Executable Insights on
process weaknesses and
model their impact

Process Process
implementation To-be process redesign
model
Process Identification – The Context
Definition of Business Strategy

Process Identification – So that the organizations know which

process to focus that
- Create value of strategic relevance
- Have substantial problems
- Are feasible and flexible enough to improve

Some processes need to receive priority!

Business strategy is an organizational perspective on setting and

meeting business goals. (Mintzberg)

Strategy can be operationalized into Business Goals and hence

for Business Process Identification

Slide 41
Session 2: Process Identification
Layout of the Session
1. Session 1 – Recap
2. Knowing the BPM Players
3. The Context of Process Identification
4. Definition of the Process Architecture
1. The Process Checklist
2. Process Categories
3. Relationships Between Processes
4. Reuse of Reference Models
5. Process Landscape Model
6. The Example of SAP’s Process Architecture
5. Process Selection
1. Selection Criteria
2. Process Performance Measures
3. Process Portfolio
6. Case Discussion
1. Class Exercise
7. Recap
8. Readings and Assignment for the Next Session

SEITE 42
 Process Identification
• Process Architecture
• What processes are executed in the organizations?
• What is the relationship between different processes?
• Structural dependencies between processes and different enterprise perspectives
• Process Portfolio
• Determine Strategic Importance, health, and feasibility of the processes
• Select Which ones should the organization focus on?

Slide 43
 What to consider as a Business Process?
The Process Checklist
It may not be easy to decide on what to consider as a business process. A chunk of work that is frequently
repeated might not be a business process on its own. To prevent poor scoping decisions, it is useful to consider
the following process checklist:
• Is it a process at all?
 It must be possible to identify main action, which is
applied to a category of cases.
 Name is of form verb + noun.
• Can the process be controlled?
 Can any ongoing activity be a process?
 Repetitive series of events and activities to execute
individually observable cases.
 Without a clear case notion, process management
is not feasible.
 Also, without any sense of repetition, a group of
business activities may better qualify as a project
than as a business process.
• Is the process important enough to manage?
 There is customer who is willing to pay for outcomes,
 Organization that carries out the process would be
willing to pay another party for taking over, or
 Legal, mandatory framework compels an organization
to execute it.
• Is the scope of the process not too big?
 1:1 relation between initial event and activities.
• Is the scope of the process not too small?
 Rule of thumb: there should be at least three different
actors – excluding the customer – involved.
 If there are no handoffs between multiple actors or
systems, there is little that can be improved using BPM
methods.
Slide 44
 Readings and Assignment for the Next Session
• Assignment No 3 – 3 students
• Explain the terms using an example process – Cycle time, Throughput, Lead Time, Takt
Time, Idle Time, Waiting Time, Work in Process, Buffer, Bottleneck, Transport Time
• Use a process example to elucidate and contrast terms in your assignment
Session III – Process Modeling
• Class Assignment
• Case Preparation - McAfee, Andrew F. (2006). Pharmacy service implementation at CVS.
• Case Questions
• Make a flow chart for their order-to-cash process.
• List different types of errors or exceptions, and how they are handled or not
handled.
• Bring your laptops
• Install Bizagi Studio (free version)

Slide 45
 Reference Readings
1. Dumas, M., La Rosa, M., Mendling, J., & Reijers, H. A. (2013). Introduction to Business
Process Management. In Fundamentals of business process management (Vol. 1, pp. 35-
73). Heidelberg: Springer
2. Magic Quadrant for Intelligent Business Process Management Suites, Gartner (2019)
3. McAfee, Andrew F. (2006). Pharmacy service implementation at CVS. HBR. 606-015
4. https://hbswk.hbs.edu/archive/hbs-toolkit-basic-operations-self-instructional-workbook

Slide 46