The Effect of Process Ownership Assignment on Business Process Standardization Success
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1 The Effect of Process Ownership Assignment on Business Process Standardization Success Emergent Research Forum Paper Janina Kettenbohrer University of Bamberg Daniel Beimborn Frankfurt School of Finance & Management Mirko Kloppenburg Lufthansa Technik AG Abstract Many organizations aim to standardize their processes to increase performance. Organizational governance is an important driver for successful business process standardization. A central role within this governance structure is performed by the process owner who is responsible for the definition of processes. In this paper, the effect of different possible configurations of assigning process ownership in an existing organizational multi-level hierarchical structure is analyzed by conducting an embedded case study. The most important finding was that in most cases process ownership was assigned to a person who was already line manager for a single business unit which was responsible for executing a part of or the whole process. Thus, responsibility for the process itself and for the required resources (e.g., personnel) was combined. Based on these findings, we plan to conduct a study to analyze the impact of the different process ownership assignments on the success of process standardization. Keywords Process owner, business process standardization, line manager Introduction Business process standardization (BPS) is an important step within the business process management (BPM) lifecycle (Dumas et al. 2013) to increase organizational performance (Münstermann and Weitzel 2008). Main reasons to standardize processes are realizing cost synergies, ensuring quality, and increasing operational performance more easily (Manrodt and Vitasek 2004) due to less process errors, facilitated communication and reporting, achieved economies of scale, and used expert knowledge (Wüllenweber et al. 2008). Organizational processes are closely related to the implemented information technology. So, these two concepts have to be considered jointly. To successfully implement BPS, besides top management support and cooperation of involved departments, organizational governance is one of the key factors (Münstermann and Eckhardt 2009). Just defining a to-be process is not sufficient there has to be a governance structure ensuring that the newly defined standard process is actually, effectively, and sustainably implemented in the organization. So, the governance structure facilitates monitoring that single workers adhere to the standard process. A successfully implemented to-be process does not imply a smooth and definition-compliant execution by the employees. Thus, deviations could occur due to employees identifying local optimization potentials (and even changing the process accordingly) which are not compatible to the global optimum (Kettenbohrer et al. 2013). A central role within a process management governance structure is taken over by the process owner (Kohlbacher and Gruenwald 2011a, 2011b). We assume that its assignment could be crucial for the governance model s effect on process standardization. Based on this assumption, the goal of this paper is to analyze the effect of different possibilities to assign process ownership on different hierarchical levels in the organization. Therefore, our research question is: Which is the most effective governance setup for assigning process ownership to sustainably standardize business processes? Twenty-second Americas Conference on Information Systems, San Diego,
2 The remainder of this paper is structured as follows: In the next section, we introduce the theoretical background which helps to orient our work. Then, we introduce the different possible assignment setups and the results of a first qualitative evaluation based on an embedded case study. The paper concludes with an outlook on future research. Theoretical Background Business process standardization (BPS) aims to provide a template for all process instances of the considered business process (Tregear 2010). Accordingly, BPS can be defined as "the unification of business processes and the underlying actions within a company [ ]" (Schäfermeyer et al. 2010, p. 2). However, companies are struggling with successfully implementing a process standard in a distributed organization due to difficulties in finding the right process to be standardized (Zellner and Laumann 2013) or employees resisting against the change (e.g., Pardo del Val and Martínez Fuentes 2003). In addition, the locus where benefits of standardization are reaped often differ from the locus where the standardization efforts appear (the so-called standardization problem (Weitzel et al. 2006)) (Kettenbohrer and Beimborn 2014). To cure these problems, a governance structure (e.g., assignment of process ownership) helps to ensure the standard-compliant behavior of its units and employees (Münstermann and Eckhardt 2009). Business process management literature provides a variety of different governance models (e.g., Koch et al. 2011); but, these governance models focus solely on process responsibility. To also consider resource responsibility and its interdependencies to process responsibility, we developed a governance model for sustainable BPS (Kettenbohrer et al. 2013). The socalled Framework for Assignment of Responsibilities (FAR+) breaks these two responsibilities down by providing corresponding roles. For this paper, the most important roles of this framework are process domain owner, process owner, and line manager. The process domain owner is accountable and responsible for strategic direction of one process domain (i.e., a group of processes) as well as for the appointment of process owners of processes in the domain. The process owner is accountable for process definition, documentation, and improvement of a process. Thus, the process owner defines how an employee performs an activity. Resource responsibility is assigned to a line manager who is accountable for process execution within the corresponding organizational unit. The line manager defines what activities an employee performs (Kettenbohrer et al. 2013). Possible Assignment Setups for Process Ownership The following three basic setups for assignment of process ownership (Figure 1) have been identified. 1) Process Owner is Common Line Manager The first setup is characterized by the assignment of process ownership to the common line manager of all employees performing tasks within the corresponding process. So, the person executing the line manager role also takes over process responsibility. This setup is the most powerful option to assign the process owner role because it enables the role owner to assign activities to employees ( what they should do ) as well as to define how the activities are performed. This setup is most applicable to internal processes within one department (i.e., an organization unit with limited number of sub-units (e.g., teams or groups) performing a small number of process instances). By contrast, the setup is not applicable to standardize processes across different business units, sites, or even legal entities. 2) Process Owner is Line Manager of One Unit In the second setup, process ownership is assigned to one of the line managers of one unit involved in process execution. The process domain owner role is assigned to the common line manager of the overall business unit. On the one hand, the setup is applicable to standardize processes of larger organizations across different sites and legal entities. On the other hand, compared with the first setup, this setup increases coordination effort for the process owner and decreases process owner s power due to missing resource responsibility for employees within adjacent organizational units. Another limitation of the setup could be that performing the process owner role may be biased by being line manager for one of the involved organizational units simultaneously. Twenty-second Americas Conference on Information Systems, San Diego,
3 3) Process Owner is Direct to Common Line Manager The third setup is based on the assignment of process ownership to an independent direct of the common line manager (who also takes over the role of the process domain owner) of the business unit. The process owner s independency is characterized by being not a line manager of employees performing activities within the process (i.e., process owner takes over process responsibility only). This independence reduces the risk of being biased by specific organizational unit s interests. In addition, this setup is most beneficial to focus on the right level of detail and to increase power by using the support of the common line manager respectively process domain owner. Research Methodology Figure 1. Possible Assignment Setups for Process Ownership To analyze the effectiveness of the different possible setups for process ownership assignment, we conducted an embedded case study with 25 sub-units of analysis. Cases studies are an effective strategy for exploring how (i.e., how can process standardization be assured?) and why (i.e., why was a certain process ownership assignment effective?) questions (2002). Furthermore, direct observations of a phenomenon in its natural setting help to receive a profound and realistic understanding about it (Babbie 1983). To evaluate and observe the effect of the different possible setups, we had the opportunity to accompany the role assignments in several business units of Lufthansa Technik (a globally operating aircraft maintenance organization with about 20,000 employees in approx. 30 subsidiaries). We participated in meetings between the implementation team and 25 process owners who were randomly selected. In these meetings, the different setups were presented and discussed. Besides explaining the pros and cons, the implementation team acted as a sparring partner to discuss the concrete implementation for the corresponding process. In every meeting, two researchers took part in person or via telephone conference. One researcher only listened to the discussions during the meetings whereas the second researcher made notes. Unfortunately, it was not possible to digitally record the discussions due to privacy concerns. The memos were discussed and interpreted by our research team to identify the applied governance setup as well as its pros and cons, right afterwards. Two months after the initial meeting where the process owner role was assigned, we had conference calls with each of the 25 appointed process owners. Aim of these calls was to review the effectiveness of the chosen process ownership assignment as well as to understand possible barriers for successful process standardization. Accordingly, two researchers participated in the conference calls. One researcher headed the call whereas the second one took notes. Case Study Results At first, we have to point out that the hierarchy levels between the line manager with assigned process (domain) owner role and employees vary in reality. But, in general, all role assignments can be categorized to one of the three basic setups. The insights of the case studies (derived via participation in the meetings with the process owners and memos of these meetings) confirm that setup 1 (process owner is common line manager) is the most Twenty-second Americas Conference on Information Systems, San Diego,
4 powerful setup because process standardization is enforced by combining line manager and process owner role by one person. On the downside, applicability of this setup is limited to processes of organizations with flat hierarchy only. This limitation is caused by the necessary level of detail of the process owner. A process owner needs a specific level of detail to be able to define, coordinate, and improve a process, which is missing on higher levels of hierarchy. So, this setup is not suitable to facilitate process standardization of processes characterized by several sites or legal entities involved in the process where several levels of hierarchy between common line manager and employees exist. Within the case study, setup 2 was applied to most of the processes. By analyzing the specific process ownership role assignments of these processes, we could observe that the major criterion for assigning the process owner role was the number of employees who are led by the line manager who takes over process ownership. Thus, most often, the process owner role was assigned to the line manager with the most employees in the respective process to leverage the power of setup 1 in a sub-area of a setup 2 organization. A potential biasing of the process ownership by being line manager of one business unit at the same time can be reduced by equally distributing process owner roles within the group of line managers of one process domain. For example, in a process domain with four processes which are executed by four different locations, each process owner role can be assigned to one of the four line managers of the locations. This distributed process ownership creates an area of conflict between the involved parties which enforces neutrality of the process ownership due to the fact that process owners always have to keep in mind that favoring the own location will cause disadvantaging by other process owners later on. A higher level of neutrality of the process ownership can be reached by the application of setup 3 which was observed in some of the processes. These processes can be characterized by a strong focus on the management and improvement of the process by the existence of dedicated capacity. In addition, the evaluation confirms the enforced power of the process owner on a lower management level by being a direct of the common line manager. In general, setup 3 was identified as the most effective model with regards to process standardization due to independence and neutrality of the process owner, enforced power by the common line manager, and availability of expertise based on the level of detail of the position. Conclusion and Next Steps Aim of this study was to analyze the effect of different assignment setups for process ownership to sustainably standardize business processes. Therefore, we presented various setups and conducted a first qualitative evaluation of their effectiveness. The most important finding was that most of the processes within the analyzed organization selected setup 2 to combine process responsibility with resource responsibility for the enforcement of the process ownership in one sub-unit of the process at least. But at the same time, they ignored the risk of biasing the process ownership as well as providing the necessary level of detail for the assignment. Overall, this reduces the effectiveness of process ownership with regards to process standardization. In addition, we identified the assignment of the process architect role defined by the FAR+ concept (Kettenbohrer et al. 2013) as further variable to optimize the process management role setup to strengthen the effectiveness of process standardization. As limitation, it has to be mentioned that our case study has been conducted in one organization only. Thus, the results of our first evaluation might be biased and their generalizability is limited, so far. In addition, we only collected qualitative data based on interviews, observations and memos. So, the effectiveness has not been measured quantitatively, up to now. To cure the limitations, we plan to examine the effects of the setup possibilities in different organizational contexts. We will accompany the implementation of similar governance structures in several other companies (i.e., in an airline, a customer benefit program organization, and in a catering firm). So, we will have the opportunity to observe the different effects uncoupled from one single organizational context which will increase the generalizability of our findings. In addition, we will accompany the implementation of the governance model in some of those firms over a longer period. This will enable us to check whether there will be changes regarding the process ownership assignment over time and why they occur. It would be interesting to observe whether more processes will move towards setup 3. Moreover, we plan to develop a research model to analyze empirically the impact of the different process ownership assignments on process standardization success. In the first step, we will proceed with qualitative research by conducting several interviews to analyze the reasons why certain governance setups were chosen. Based on the insights derived by interviews, we will develop hypotheses regarding the impact of the different process ownership assignments on process standardization success. Then, we will conduct a smaller survey-based study in the globally operating Twenty-second Americas Conference on Information Systems, San Diego,
5 maintenance organization where we did the case study introduced above. This survey serves as pilot-study to develop and refine our measurement instrument. Finally, we will conduct a survey-based study in several companies to comprehensively analyze the effect of the different process ownership assignments. For instance, the degree of standardization (i.e., deviation from the standard process) could give insights into the process owner s power. To identify the degree of standardization, a self-assessment for the underlying process could be made by different process participants (process owner, but also process employees). Here, a BPM maturity model (e.g., Rosemann and de Bruin 2005) could be promising. Finally, our research will potentially hold great implications for research and practice alike. For researchers, our results could serve as a starting point to further analyze the power of process ownership. For instance, it would be promising to examine empirically how process ownership could be strengthened (e.g., by a standardization procedure model or local process managers). From a managerial perspective, our work will provide insights how to successfully shift an organization towards process orientation and sustainably standardize business processes. REFERENCES Babbie, E The Practice of Social Research, Belmont: Wadsworth Publishing. Dumas, M., La Rosa, M., Mendling, J., and Reijers, H. A Fundamentals of Business Process Management, Berlin, Germany: Springer. Kettenbohrer, J., Beimborn, D., and Kloppenburg, M Developing a Governance Model for Successful Business Process Standardization, in 19th Americas Conference on Information Systems 2013, Chicago, Illinois, USA. Kettenbohrer, J., and Beimborn, D What You Can Do to Inhibit Business Process Standardization, in 20th Americas Conference on Information Systems 2014, Savannah, Georgia, USA. Koch, H., Gonzalez, E., and Leidner, D Resolving IT-Culture Conflict in Enterprise 2.0 Implementations, in 19th European Conference on Information Systems, Helsinki, Finland. Kohlbacher, M., and Gruenwald, S. 2011a. Process Orientation: Conceptualization and Measurement, Business Process Management Journal (17:2), pp Kohlbacher, M., and Gruenwald, S. 2011b. Process ownership, process performance measurement and firm performance, International Journal of Productivity and Performance Management (60:7), pp Manrodt, K. B., and Vitasek, K Global Process Standardization: A Case Study, Journal of Business Logistics (25:1), pp Münstermann, B., and Eckhardt, A What Drives Business Process Standardization?: A Case Study Approach, in International Conference on Information Resources Management, Niagara Falls, Canada. Münstermann, B., and Weitzel, T What Is Process Standardization? in International Conference on Information Resources Management, Niagara Falls, Canada. Pardo del Val, M., and Martínez Fuentes, C Resistance to Change a Literature Review and Empirical Study, Management Decision (41:2), pp Rosemann, M., and de Bruin, T Towards a Business Process Management Maturity Model, in 13th European Conference on Information Systems, Regensburg, Germany. Schäfermeyer, M., Grgecic, D., and Rosenkranz, C Factors Influencing Business Process Standardization: A Multiple Case Study, in 43rd Hawaii International International Conference on Systems Science, Koloa, Kauai, HI, USA. Tregear, R Business Process Standardization, in Handbook on Business Process Management 2, J. vom Brocke and M. Rosemann (eds.), Heidelberg, Germany: Springer, pp Wüllenweber, K., Beimborn, D., Weitzel, T., and König, W The Impact of Process Standardization on Business Process Outsourcing Success, Information Systems Frontiers (10:2), pp Yin, R. K Case Study Research: Design and Methods (Applied Social Research Methods): SAGE Publications. Zellner, P., and Laumann, M Evaluation of Business Processes for Business Process Standardization, in 17th Pacific Asia Conference on Information Systems, Jeju Island, Korea. Twenty-second Americas Conference on Information Systems, San Diego,
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