Business Process Discovery. Discovery Goals. Environment. Resources. Market. Prof. Cesare Pautasso
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1 1 / 33 Enterprise Organization 2014 Cesare Pautasso 6 / 33 mler Brache Process Modeling, Management and Mining Resources Competition Market Process Discovery Prof. Cesare Pautasso Suppliers Labor Market Capital Market Enterprise Customers Shareholders Research Environment Laws and Regulations Economy Culture Climate Discovery Goals Processes are hidden in organizations, waiting to be found Identify Processes: distinguish processes, select the important ones Represent Processes: gather knowledge about processes so that they can be modeled 2 / 33 Rumm 2014 Cesare Pautasso Supplier A Supplier B Value System Enterprises add value by collaborating with suppliers and delivering to customers their products through sales and distribution channels Enterprise Value Chain Distribution Channel Sales Channel Customer 7 / 33 Michael Porter
2 Support Primary Enterprise Value Chain In-bound Logistics Firm Infrastructure Human Resources Technology Development Procurement Operations Out-bound Logistics Marketing and Sales Service Margin 8 / 33 Michael Porter Order Ful!llment Process Receive Order Establish Sourcing Procedures Approve Order Sign Contracts Supply Planning Process Fill Order Evaluate Suppliers Deliver Order Primary directly add to the value generated by an enterprise Support enable the ef!cient execution of the primary functions Stock Supplies Supplies Stocking Process Receive Supplies What to identify? Process Owner: who is responsible? Order Supplies 9 / 33 Types of Processes 1. Management Processes: control and steer the organization 2. Core Processes: generate value, directly interact with customers 3. Support Processes: acquire resources 10 / / 33 Process Goal: what is the purpose? Process Scope: what are the boundaries between processes? Process Portfolio: what are the important processes?
3 Stakeholders Suppliers: are needed for the success of the process (provide input, involved in upstream processes) Owner: responsible for the process success Participants: involved directly in the process (but may have a narrow perspective about it) Suppliers Owner Participants 12 / 33 Gathering Knowledge Centralized workshops - all stakeholders present their perspective in the same meeting Facilitate knowledge sharing and organizational learning Con"icting views can be immediately discussed Only works for small organizations Distributed interviews - multiple meetings with individual or small groups of stakeholders The only practical way to learn from large organizations Challenging to resolve inconsistencies 13 / 33 Customers: depend on the successful outcome of the Customers process (only see the output, involved in downstream processes) Discovering Organizations or Processes? Processes 14 / 33 Alec Sharp Organizational Units This indicates some confusion between mapping the organization and discovering its processes. Some processes are crossfunctional, and the same units may run multiple processes.
4 Process Goals Functional: the main purpose of the process (e.g., purchase supplies, hire staff,!nd customers, develop new products) Non-Functional: hard criteria for success (time, cost, quality, satisfaction, compliance) with the corresponding metrics, thresholds and priorities 15 / 33 Abstraction Levels 1. Make Money for the Company 2. Keep Customers Happy 3. Develop new products 4. Find customers that want to buy them 5. ensure printers have enough paper 6. close the headquarters every night Abstraction Levels 17 / / 33 Process Scope Abstraction Level coarse-grained vs.!ne-grained Boundary separation between distinct processes 16 / Value Chains 2. Main Processes 3. Sub Processes 4. Activities
5 Coarse vs. Fine Grained Coarse Grained Processes are too large to study and optimize. Too many people are involved: gathering knowledge and applying changes becomes expensive. Improving Fine Grained Processes may lead to local optimizations where the overall performance is not improved Activities or Processes? Sales Process Identify Leads Contact Follow up Close Sale 19 / / 33 Hierarchy Example: BT Activities Process Groupings Core Processes Processes Operational Processes Detailed Process Flows Meta Level Levels Operations Levels Process Levels Logical Levels Physical Levels Gathering Knowledge Model structure, methodology and modelling standards De!nes business activities Distinguishes operational customer oriented processes from management and strategic process Shows groups of related business functions and standard end-to-end processes Core processes that combine together to deliver Service Streams and other end-to-end processes Decomposition of core processes into detailed success model business process "ows Detailed operational process "ows with error conditions and product and geographical variants (where required). Further decomposition of detailed operational where required 21 / 33 British Telecommunications (2006) Top-Down - start from the top of the organization (strategic view) and re!ne the knowledge progressively moving towards operational processes Bottom-Up - observe people while they work, follow the progress of speci!c pilot cases as they move through the involved business functions, reconstruct processes from parially overlapping views with the risk of incomplete information 22 / 33
6 Scoping: Case/Function Matrix 23 / 33 Product Types: life vs. health insurance, book vs. magazine, software vs. hardware Service Type: prepaid vs. contract subscriber Geographic Location: Continent, Country, Regional Markets 24 / 33 De!ne process boundaries depending on organizational aspects (which business functions are involved) and a classi!cation of cases (which way different products/services are handled) Channel: in person, telephone, , Web Customer: new, returning, frequent "yer Case types can be a combination of any of the above classi!cation dimensions
7 25 / 33 Aside: Reference Models 26 / 33 lec Sharp De!ne what the organization does to handle Why can't we use reference process models the various case types instead of going through all the effort of 4. Deliver Product and Services process discovery? 4.2. Procure Materials and Services Manage Suppliers Monitor Quality of Product Delivered are re!ned and decomposed up to a level of detail that can help discover organizational units that can play different process roles See the APQC Process Classi!cation Framework reference model 1. Overwhelming due to extremely!ne granularity 2. Early stakeholder involvement in discovery helps to get buy-in later with process improvement 3. Adapting a complex reference model may take even more work than discovering processes from scratch Reference Models help to prepare the discovery process and ensure that important details have not been overlooked Al
8 Case/Function Matrix Function is performed on Case Type 1. Determine which functions are performed for each case type 2. Aggregate related functions and case types into the same process boundary Coarse grained One big process covers all functions and all case types 27 / / 33 Fine grained A process every time a function can be performed for each case type Medium grained Tradeoff between broad scoping and narrow focus, some functions collaborate over more than one case type, but not all. 29 / / 33
9 Bachelor Promotion Master PhD 31 / 33 Administration Registration Admission Graduation Evaluation Instruction Professors Testing Curriculum Development References Porter, Michael E., "Competitive Advantage". Ch. 1, pp The Free Press. New York, 1985 Geary A. Rummler, Alan P. Brache, Improving Performance: How to Manage the White Space in the Organization Chart, Jossey-Bass, May 1995 Marlon Dumas, Marcello La Rosa, Jan Mendling, Hajo Reijers, Fundamentals of Process Management, Chapter 2, Springer, 2013, ISBN M. Rosemann, Process Portfolio Management, BPTrends, April / 33
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