Business Process Modeling

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Slides from a webinar that I did recently for TIBCO. Full webinar replay with audio available at http://www.tibco.com/mk/2007/bpm-bpm11-jul-07usarc.jsp

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Business Process Modeling

  1. 1. Business Process Modeling Sandy Kemsley Kemsley Design Ltd. www.column2.com
  2. 2. Agenda <ul><li>What’s in your processes? </li></ul><ul><li>Process modeling notation/standards </li></ul><ul><li>Modeling for ROI </li></ul><ul><li>Changing processes = changing job roles </li></ul>
  3. 3. What’s in your processes?
  4. 4. Kicking it off <ul><li>Human intervention </li></ul><ul><li>Scanned document </li></ul><ul><li>External event </li></ul><ul><li>Invoked as web service </li></ul>
  5. 5. Types of steps/tasks <ul><li>Human-facing: </li></ul><ul><ul><li>Transactional heads-down </li></ul></ul><ul><ul><li>Occasional participant </li></ul></ul><ul><ul><li>Collaboration </li></ul></ul><ul><li>System: </li></ul><ul><ul><li>Web service orchestration </li></ul></ul><ul><ul><li>Legacy application integration </li></ul></ul><ul><ul><li>Content management integration </li></ul></ul>
  6. 6. Other considerations <ul><li>External participants </li></ul><ul><li>Process monitoring </li></ul><ul><li>Collecting analytics data </li></ul><ul><li>Frequency of process/rule/staff changes </li></ul>
  7. 7. A short segue on BPM/SOA <ul><li>BPM: </li></ul><ul><ul><li>Management practice </li></ul></ul><ul><ul><li>Tools for automating processes </li></ul></ul><ul><li>SOA: </li></ul><ul><ul><li>Architectural philosophy </li></ul></ul><ul><ul><li>Design standards-based services to access system functionality </li></ul></ul>
  8. 8. BPM and SOA Service A Service B Service C Service D Service E Legacy System Database ERP System Process Step 1 Process Step 2 Process Step 3 Process Step 4
  9. 9. BPM and SOA together <ul><li>BPM is the “killer app” for SOA; SOA is the enabling infrastructure for BPM </li></ul><ul><ul><li>SOA alone only allows you to design and build a set of services </li></ul></ul><ul><ul><li>BPM alone would require custom coding for each system integration </li></ul></ul><ul><li>BPM + SOA orchestrates people and services into a business process </li></ul>
  10. 10. SOA in process modeling <ul><li>Discovering services </li></ul><ul><ul><li>What services already exist </li></ul></ul><ul><ul><li>Whether existing services meet the needs </li></ul></ul><ul><li>Specifying services </li></ul><ul><ul><li>What new services need to be created </li></ul></ul><ul><ul><li>What legacy functions need to be wrapped in services </li></ul></ul>
  11. 11. Simulation and optimization <ul><li>Identify key performance indicators </li></ul><ul><li>Estimate parameters: </li></ul><ul><ul><li>Arrivals </li></ul></ul><ul><ul><li>Time per step </li></ul></ul><ul><ul><li>Participants </li></ul></ul><ul><ul><li>Cost per step </li></ul></ul><ul><li>Run and compare scenarios </li></ul>
  12. 12. Simulation example
  13. 13. Process modeling standards
  14. 14. Graphical notation standard <ul><li>BPMN (Business Process Modeling Notation) = diagramming standard for drawing business processes </li></ul><ul><li>Method of communicating processes: </li></ul><ul><ul><li>Understandable by business users and unambiguous </li></ul></ul><ul><ul><li>Reduces translation errors between business and IT </li></ul></ul><ul><li>Easy transition between tools </li></ul>
  15. 15. BPMN flow objects <ul><li>Event </li></ul><ul><li>Activity </li></ul><ul><li>Gateway </li></ul>
  16. 16. BPMN connecting objects <ul><li>Sequence flow </li></ul><ul><li>Message flow </li></ul><ul><li>Association </li></ul>
  17. 17. BPMN swimlanes <ul><li>Pool </li></ul><ul><li>Lanes </li></ul>
  18. 18. BPMN artifacts <ul><li>Data object </li></ul><ul><li>Group </li></ul><ul><li>Annotation </li></ul>
  19. 19. BPMN example: exception handling
  20. 20. BPMN example: transaction
  21. 21. BPMN example: funds transfer
  22. 22. Modeling for ROI
  23. 23. Areas of process innovation <ul><li>Automational </li></ul><ul><li>Informational </li></ul><ul><li>Sequential </li></ul><ul><li>Tracking </li></ul><ul><li>Analytical </li></ul><ul><li>Geographical </li></ul><ul><li>Integrative </li></ul><ul><li>Intellectual </li></ul><ul><li>Disintermediating </li></ul>Source: Process Innovation, Thomas H. Davenport, 1992
  24. 24. Improve efficiencies <ul><li>Automate manual work steps </li></ul><ul><li>Directly integrate data between systems </li></ul><ul><li>Provide process monitoring and control </li></ul><ul><li>Automate process statistics gathering and analysis </li></ul>
  25. 25. Cut out the middle man <ul><li>Provide customer self-service to initiate processes </li></ul><ul><li>Provide process visibility to customer </li></ul>
  26. 26. Location, location, location <ul><li>Share redundant processes between business units </li></ul><ul><li>Identify steps that can be completed in isolation </li></ul><ul><li>Automate escalation and handoffs </li></ul><ul><li>Allow remote work </li></ul>
  27. 27. ROI: reduce costs <ul><li>Reduce manual tasks </li></ul><ul><li>Reduce error rates </li></ul><ul><li>Allow customer self-service </li></ul><ul><li>Reduce compliance costs </li></ul><ul><li>Reduce time to implement changes </li></ul><ul><li>Reduce functional redundancy </li></ul><ul><li>Allow outsourcing </li></ul>
  28. 28. ROI: increase competitive advantage <ul><li>Reduce time to market </li></ul><ul><li>Reduce end-to-end cycle time </li></ul><ul><li>Improve customer service </li></ul><ul><li>Increase capacity </li></ul><ul><li>Improve decision-making </li></ul>
  29. 29. Calculating ROI <ul><li>Baseline the “as-is” process </li></ul><ul><li>Model and simulate “to-be” process </li></ul><ul><li>Select relevant ROI metrics </li></ul><ul><li>Select ROI calculation method </li></ul><ul><li>Calculate best and worst case scenarios </li></ul>
  30. 30. Common ROI pitfalls <ul><li>Increased capacity does not guarantee increased revenue </li></ul><ul><li>Cost reduction may require FTE reductions </li></ul><ul><li>Providing self-service does not guarantee that customers will use it </li></ul><ul><li>Remote work and outsourcing can have hidden costs </li></ul>
  31. 31. Classify BPM ROI potential <ul><li>Increased agility to business changes </li></ul><ul><li>Optimized operational efficiency </li></ul><ul><li>Process standards compliance </li></ul><ul><li>Shortened process cycle times </li></ul><ul><li>Better information for decision-making </li></ul><ul><li>Reduced complexity of integrating people, processes and existing systems </li></ul>
  32. 32. Changing job roles
  33. 33. BPM supports changing roles <ul><li>Support for change management initiatives </li></ul><ul><ul><li>Model the new organization </li></ul></ul><ul><ul><li>Simulate and optimize changes </li></ul></ul><ul><ul><li>Measure results </li></ul></ul><ul><li>Enabling more rapid changes </li></ul><ul><ul><li>Overarching process orchestration and governance </li></ul></ul><ul><ul><li>Real-time view of organizational processes </li></ul></ul><ul><ul><li>Agile, business-driven changes </li></ul></ul>
  34. 34. BPM causes role changes <ul><li>Business function concerns and benefits: </li></ul><ul><ul><li>Workers </li></ul></ul><ul><ul><ul><li>Concerns: job loss </li></ul></ul></ul><ul><ul><ul><li>Benefits: better job and training </li></ul></ul></ul><ul><ul><li>Supervisors </li></ul></ul><ul><ul><ul><li>Concerns: loss of control </li></ul></ul></ul><ul><ul><ul><li>Benefits: improved team and work management </li></ul></ul></ul><ul><ul><li>Managers </li></ul></ul><ul><ul><ul><li>Concerns: failure to achieve ROI </li></ul></ul></ul><ul><ul><ul><li>Benefits: improved visibility and performance </li></ul></ul></ul>
  35. 35. Overcoming change resistance <ul><li>Communication of plans and impacts </li></ul><ul><li>Involvement in process modeling </li></ul><ul><li>Demonstration of new technologies </li></ul><ul><li>Smaller “quick hit” before tackling radical reengineering </li></ul>
  36. 36. Summary <ul><li>Dissecting your process </li></ul><ul><li>BPMN </li></ul><ul><li>ROI </li></ul><ul><li>BPM and role changes </li></ul>
  37. 37. Questions? Sandy Kemsley Kemsley Design Ltd. www.column2.com

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