adapted from wikipedia...Business_process_management by Adrian Tonkin, November 2007
The business process management life-cycle describes the cycle a living business process follows from it's creation to use, measurement and improvement. Business processes are living things in the sense that as people use them and begin to understand the value of following a structured approach to accomplishing business objectives, so they find new ways to manipulate and add or remove tasks such that they add more value and improve the effectiveness of your organisation. These business processes evolve and grow over time, mirroring with the ever changing needs of your organisation in response to competitive, legislative and financial pressure.
The activities which constitute business process management can be grouped into five categories:
Design by it's very nature implies innovation, and process design is no exception. The purpose of any design is the satisfaction of needs. Understanding these needs is the logical starting point for the creation of a business process. To fully understand the needs, it is necessary to conduct research into the problem - this is traditionally the domain of the business analyst.
Process Design encompasses the following:
Good design reduces the number of problems over the lifetime of the process. Changes to business processes, resulting from changes in the context that a business operates in are an integral part of the BPM life-cycle and result from activities conducted further on in the cycle. Using the information gathered from processes already automated in your BPM tool, you update the design of your existing processes to try new ideas, usually with the intention of improving the way your business operates. In so doing, your business processes evolve over time.
Business process modeling involves the capturing of your process in an electronic format so that you have a definition that may be used to better understand the process and to test various scenarios against it in an attempt to improve how things are done. Scenario testing is more commonly called simulation. Process modeling encompasses taking the process design and introducing different cost, resource, and other constraint scenarios to determine how the process will operate under different circumstances.
Simulation involves running "what-if analysis" on the processes to observe how they behave under load and to measure the likelihood that exceptions will occur. You can test capacity planning scenarios like "what if I have 75% of resources to do the same task?" or "what if I want to optimize my process so I can do the same job in 80% of the original cost?"
For a detailed explanation of process modeling, go to http://en.wikipedia.org/wiki/Process_modeling.
Once your process has been designed and validated, you are ready to automate it through a BPM tool. A BPM tool is most often a suite of applications that facilitate the definition, integration, execution and user participation in a business process.
At the heart of a BPM suite is the process engine, which executes and controls process instances in accordance with the process definition to route work from one task to another, between humans and systems to accomplish process outcomes and satisfy business needs. It supports deadline monitoring at a task level with escalations where required. Integration varies in difficulty, depending on the suite in question. In it's simplest form, integration involves the configuration of "off the shelf" adapters; conversely, where this is not provided, programmers have to resort to proprietary API's.
A good BPM tool tracks the history of every process instance as it flows through the engine in an audit trail. The audit trail record is vital in providing input for the monitoring and optimization activities that follow in the BPM life-cycle.
According to The Forrester Wave in their Q3 2007 review of the human centric BPM market, leaders in the BPM application suite arena include TIBCO (acquired Staffware), IBM (acquired FileNET) and Software AG (acquired webMethods).
Process monitoring encompasses the tracking of individual process instances so that information on their state may be easily seen and statistics on the performance of one or more processes can be provided. A good example of this tracking is being able to determine the state of a customer order (e.g. ordered arrived, awaiting delivery, invoice paid) in order to identify problems in its operation and correct them. In addition, this information can be used to work with customers and suppliers to improve their connected processes. The generation of measures on how quickly a customer order is processed or how many orders were processed in the past month are examples of reports generated from the statistics gathered. These measures tend to fit into three categories:
The degree of monitoring depends on what information the business wants to evaluate and analyze and how business wants it to be monitored, in real-time or ad-hoc. Here, business activity monitoring (BAM) extend and expand the monitoring tools in BPMS.
Process mining is a collection of methods and tools related to process monitoring. The aim of process mining is to analyze audit trails and event logs extracted through process monitoring and to compare them with an 'a priori' process model. Process mining allows process analysts to detect discrepancies between the actual process execution and the 'a priori' model as well as to identify and analyze bottlenecks.
Process optimization goes hand in hand with process monitoring. Deficiencies in processes are easily spotted during the monitoring process, when bottlenecks or disused tasks are uncovered. Root cause analysis of the problem uncovers the circumstances that lead to the problem and empowers the optimization team to take corrective actions.
To effectively optimize a process, a simulation environment is necessary in which the process definition can be varied and scenarios tested to determine the level of improvement in performance, if any. There are proven techniques that can be applied in process optimization to determine cost effective and efficient solutions to specific problems that have been uncovered. As usual in business, there are financial incentives in the form of cost savings and revenue generation that serve as motivation for process optimization as a vital step in the BPM life-cycle.
The activity of scenario planning overlaps with process design. Evolved processes are handed over from the optimization team to the design and modeling teams for implementation, thus completing the BPM life-cycle and entering another iteration.
