June 22, 2010 Off

Business Process Management – Fundamental Building Block for Organization Success

By in Software

Businesses worldwide would need to automate their processes not only to cut costs but also to provide Customer Satisfaction which will be the eventual differentiator in a fiercely competitive environment. 

Unless you are from technical background, it can get dicey grasping the fundamentals involved under Business Process Management and how it can be beneficial for your organization. This article touches the basics of Business process management in terms of what it is and how it can benefit an organization.

Business process management (BPM) is a systematic approach to improving an organization’s End to End performance. BPM activities seek to make business processes more effective, more efficient, and more capable of adapting to an ever-changing environment. BPM is a subset of infrastructure management, the administrative area of concern dealing with maintenance and optimization of an organization’s equipment and core operations.

BPM solutions can be broadly classified under 2 basic categories:

1) Front-Office BPM (FO-BPM) 

2) Back-Office BPM (BO-BPM)

Under the IT service management plan of your organization you need to define whether you want more human-centric workflow products (i.e. FO-BPM) or system-centric workflow products (i.e. BO-BPM). Different business life cycle will involve various combinations of the above two.

BPM requires a clear understanding of the existing processes in an organization that would be later on automated by implementing business service management strategy. Those organizations who want to automate processes, should initially take up any transactional process that requires the involvement of many people in a sequential (not compulsory) fashion with approvals and possible movement of paper from one desk to another.

Once an entire business process cycle is identified, it needs to be documented accurately with a definite beginning and an end. This is an important step and often determines the success during implementation stage. While the documentation can be done by any one, it is best that this be done by somebody who is thoroughly familiar with the process. At this point of time, the organization could also take a decision on whether to automate the process as it is or to introduce improvements. (This is a fundamental difference with ERPs wherein changes are forced on to the organization.) The documentation also needs to be structured, so as to answer questions that would come up during implementation.  Drafting a flow chart would be an easy way to graphically represent the work flow, but various elements and decision points need to be clearly marked out and noted.

Once processes are broken into activities, each activity needs to be taken up in detail, defining the ‘role’ that will execute the action, the ‘items’ that need to be captured in the activity, whether the data will be manually entered or electronically picked up. Some activities could be mandatory for the commencement of subsequent activities while some may not and some branches of a process may need to trigger exception reporting which cannot be foreseen in advance and might crop up during implementation stage.

BPM thus in a nutshell means systematization of various manual time consuming repetitive processes into automated process using BPM software customized as per individual organization needs and goals to reduce time involved in work flow and improve overall efficiency by automating the same.

Benefits of Business Process Management

There are three key advantages that BPM can bring to the table:

1. Transparency

BPM makes a business process absolutely transparent, greatly improving visibility and efficiency. Bottlenecks can literally be seen, and removed. It can show where the most delays are occurring, and where is each transaction stuck as it passes from one stage to another.

2. Process refinement

The initial configuration and design exercise coupled with the data that emerges after running processes for some time can allow refinement. This allows testing of application performance and application monitoring ensures improved efficiency in overall infrastructure management.

3. Centralization of Data

Data about each and every transaction is logged and can be retrieved as and when required. Therefore, it is possible to analyze accurately what happened. Referencing is also easier as embedded searches allow for data to be picked up as required for study.

BPM leads to IT monitoring at different phases of business process cycle and creates better, faster sub-processes which can trigger tremendous efficiency gains as the technology does much of the hard work.

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