What is BPM
Business Process Management or BPM is a strategy/methodology which improves performance and efficiency within an organisation by managing and optimising company’s business processes.
What is a Business Process
A business process is a collection of linked tasks and activities that are performed within an organisation or across organisation with the main purpose of producing something valuable for the company or for its customers. It is also known as Workflow.
Business Process example: Travel Reimbursement
Input: Submit the expense claim report
The employee submits a report which contains personal information and details about the travel expenses.
Business Process: Review the report
The submitted information is verified by the supervisor in order to match the Business Travel Reimbursement Regulation.
Output: Employee receives an answer
A decision is communicated to the employee via email, followed by the action of sending the amount of expenses to the employee bank account.
Organisations that are process-centric use BPM systems to become more efficient and more effective. An efficient process use minimum of resources and an effective process is able to deliver services according to specifications. In order to identify the processes that are inefficient or ineffective in delivering services, BPM uses real time performance monitoring.
BPM life cycle
BPM life-cycle is represented by 6 distinctiv steps:
Process design focus on identifing of existing processes and creating a correct and efficient theoretical design. The final design will include the following:
- Process flow also named as workflow
- Involved actors
- Business Rules and Policies for governing behaviour
- Alerts, notifications and escalations
- Standard operating procedures
- Service level agreements
Process design is typically done by business analysts, process analysts, or both.
After creating the theoretical design the next step is to introduce combinations of variables. This determines how the processes might work under different circumstances. For the Business Travel Reimbursement process, a good example is to change the amount of travel expenses. This works just like a “what-if analysis”.
- “What happens if the amount of travel expenses is greater than a specific amount?”
- “What if the Manager do his task in N days?”
- “What if I want to reduce time or cost?”
Process modeling is typically done by business analysts, process analysts, or both.
Execution is the step where we define the process design in a computer language. There are several approches in order to do that. One way is to develop your own application that will execute the task in a specific order. This is not a good solution because in practice these application rarely executes all the tasks, especially if it’s a complex one. Another way is to use a combination of software and human intervention. The solution will use services to perform business operations like ‘Calculating the total amount of expenses’ and ask for a human input whenever is need it.
The main focus of monitoring is to track the processes. The retrieved information can be used to create complex statistics reports. For example we can determine the status for the employee request: reviewed, approved or rejected, the total claims amount per month, year, when he submitted the request, to how an many other details.
In addition, with these information we can also create performance statistic reports. These reports can be used to improve workflow performances. For example we can track measures on how quickly a case is processed or how many cases were processed in the last day, week or month.
Process optimization’s main objective is to increase business value. Process optimization includes retrieving process performance information from modeling or monitoring step. This can help you identify potential or actual bottlenecks in your workflow but can also help you to have a better understanding of how your processes are working. Constant changes and improvements can reduce costs and deliver better quality services.
Process Reengineering is a very important step when your processes decrease in efficiency and productivity. It is recommended to re-engineer the entire process cycle when the process becomes too noisy and optimization is not fetching the desired output.
Recommended: Business Process Management(wiki)