BPM Series: Need for Business Process Management Infrastructure

Through-out my career, either as a management consultant or as an industry executive, I have always been fascinated by the potential, business processes offered to organizations to excel at the marketplace. So, when I worked on Business Process Management Systems (BPMS), I was certain, that BPM Systems would play the role of central nervous system in IT architectures of every organization. Through my blogs, I will share my views about Business Process Management Systems from the justification to evaluation to implementation.

Businesses always look at ways and means by which they can attain strategic, and operational supremacy so that they can achieve and sustain leadership position at the marketplace. Business Processes have long been considered as a tool to achieve business excellence. Various process centric initiatives such as Business Process Re-engineering (BPR), Total Quality Management (TQM), Activity Based Management (ABM), Six Sigma have been undertaken by business corporations. Just as there have been success stories, there also have been a large number of failures resulting these initiatives being branded as Hypes, & Buzzwords. All these initiatives have following important components:

Process Improvement : Identifying process & policy bottlenecks, issues, root-causes, and defining new & improved processes & policies. Depending upon the initiatives, the improvement targeted was either moderate & continuous or radical/significant

Process Execution: Carrying out business processes in-line with the new processes

Process Measurement: Defining, Measuring & Monitoring Performance Measures or Performance Indicators leading to Process Improvement.

These initiatives were supported by Information Technology (IT) at various phases of the lifecycle. For example, Process Improvement phase would require a process-mapping/simulation tool, which would facilitate definition & analysis of business processes and its components (Supplier, Inputs, Process, Customer, Output, Process Cost, Process Cycle Time, Activity Constraints, Business Rules, etc.). Process Execution and Measurement phases were supported by Workflow systems and/or packaged or custom- built integrated transaction processing systems such as ERP systems.

One of the primary reasons why initiatives such as BPR or ABM did not succeed was because these initiatives were not adequately supported by Process Execution & Process Measurement infrastructure. There would always exist a significant deviation between the designed and documented improved business processes & policies and the actual business processes being executed. Also, the measurement framework was based on manual MIS, which was extremely inaccurate. Processes and policies could not be IT enabled, which meant that process measurement framework consisted of manual registers. As a result the benefits achieved on account of these initiatives were significantly lower than the ones promised or targeted at the outset of these initiatives.

In free markets, product and service offerings tend to get commodotized. Customer service then becomes a key differentiator for organizations to survive in the marketplace. Customer service is a derivative of organizational core value chain business processes from Marketing management through after sales customer support and service. They reflect the collective (of human & systems) intelligence of the organization and always differ from organizations to organizations and industry to industry. Thus, in a competitive environment organizations would be required to be customer centric, focusing and improving upon their value chain processes.

A customer centric organization would also need to be extremely agile. In order to be customer sensitive it would need to operate in environment where it is closely integrated with its customers as well as suppliers/partners. Process Outsourcing is gaining ground. Not only are organizations outsourcing its support value chain activities but also part of its core value chain activities. In this environment, business processes would span beyond the boundaries of the organization but also very dynamic continuously undergoing change.

For this reasons organizations would require process management infrastructure, which will allow them to:
– Define and discover business processes
– Execute business processes
– Measure and Modify/Improve business processes

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