Thought Paper: Business Process Automation

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1 Thought Paper: Business Process Automation Rapid development and deployment of automation to eliminate repetitive, labor intensive, and computer related tasks throughout the enterprise. Joe Kosco Vice President Network Automation, Inc. 654 South Western Avenue Los Angeles, CA NetworkAutomation.com

2 Introduction Businesses have the extraordinarily complex task of continuously improving their service while slashing costs. In order to succeed, they must execute in an increasingly competitive business environment without making large investments in technology and infrastructure. However, they are saddled with archaic systems and applications from past investments investments that actually compel inefficient business practices rife with repetitive human interaction, delays, errors, and unnecessary cost. What these businesses need is to be liberated from the constraints of their legacy systems so they can design and implement optimized business processes to eliminate costs, improve customer service, and capitalize on new revenue opportunities. Business process automation software (BPA) is designed to solve this problem. It allows business and technology managers to design and implement new processes to deliver their products and services to customers in a more timely and cost effective way. In essence, it allows managers to design business processes with a white board mentality, or in other words, to design processes to flow as they should, not as underlying systems and applications dictate. This white paper describes how businesses can optimize, streamline, and automate their critical processes with BPA. How We Got Here Much has transpired since the landmark book Reengineering the Corporation by Michael Hammer and James Champy (HarperBusiness, 1994) was first released. The book s main theme is that businesses must completely rethink the way they execute their fundamental business processes in order to compete in the global economy. Since then, we have witnessed downsizing, rightsizing, outsourcing, a bubble, and a technological revolution. But much still remains undone because businesses lack the tools necessary for effective reengineering. The opportunity to improve business processes is only heightened in sectors where resources are perennially scarce, such as the small to medium size business market and the health care and manufacturing industries. Profit margins in these sectors are notoriously thin, so investments are generally made to support core operations, not to streamline them. When companies from these sectors do make technology investments, they typically invest in point solutions which may enhance a specific work function but rarely improve the overarching business process. For example, a customer relationship management (CRM) application may improve the continuity of interaction between a manufacturing company and its customers, but it will not align delivery date promises with plant capacity. In this case, the critical business process includes aspects of the CRM application as well as the manufacturing management application. With BPA, businesses have a unique opportunity to merge and align investments in technology with their overall business strategy. BPA gives business managers the power to design optimal business processes because they are freed from the constraints and restrictions of their legacy systems and applications. Moreover, designing optimal business processes is no longer confined to the company s four walls. It can now be extended to the entire supply chain including vendors, partners, and customers. This heightens the value businesses can create with well planned and well executed BPA strategies. In essence, BPA empowers the ground breaking concepts of Hammer and Champy with tools for real world implementation. In fact, reengineering the corporation is no longer an abstract ideal it is a business necessity. 2

3 BPA Terminology Defined To explain BPA properly, we ll introduce terminology to define many common elements of BPA, as illustrated in the diagram below. Inputs: Typically raw data (such as files, faxes, and database updates) that serve as the basis for the business process. Jobs: Individual sub processes or tasks completed by a human being, application, or system. event triggers: The things that initiate jobs. Examples include schedules (e.g., every day at 8:00 AM), a file appearing in a given network directory, or the completion of previous jobs (e.g., Job D will only begin after Job C has finished). Conditions: Decision points in a business process direct the process flow based on information created during the process itself. Event triggers are always conditions that have been met, but that conditions are not necessarily event triggers. Steps: The individual components that make up a job. If the job is copying files from one directory to another, the steps would include: 1) copying the files, and 2) pasting the files. Synonyms for steps include code, actions, BAT files, and EXE files, among others. Output: The desired outcome from a successfully operated business process. To make the diagram and definitions more understandable, we ll use an example of integrating a CRM application with a manufacturing management application. Consider the common business process of order entry to product delivery in a widget factory. The INPUT shown in our illustration is the incoming customer orders for widgets. Job A represents the entry of purchase orders, received by fax, into the order management system. In this situation, Event Trigger 1 is the daily ritual of an order entry clerk, who begins entering orders at 8:30 AM for all orders accumulated from the previous day. The orders entered can be routed along two different plants (Premium or Standard) depending on how much business the customer has done with the company during the last three months. 3

4 This decision point is illustrated by Condition X in the diagram. Unfortunately, this piece of information does not reside in the company s manufacturing management system. Instead, it s stored in the CRM application. Thus, the CRM application must be queried for customer purchase history before the decision to manufacture at the Premium or Standard plant is made. For simplicity, let s assume that data from the CRM application dictates the widget be manufactured at the Standard plant. Then, Job C (the job that determines which machines to use based on parameters in the Standard plant production system), is initiated. Once Job C is complete and the widget is made, the product is ready for shipment processing (Job D). However, Job D will not be initiated until enough widgets have been made to fill an entire truck. When the shipping system (a third application) indicates enough completed widgets for a truckful, the condition for Event Trigger 2 is met. Thus, Job D is initiated and the shipping papers are created. As you can see, a business process (even when highly simplified as in the above example) can become very complex, especially as the number of computer systems and human touch points increase. This is why BPA software, which controls the end to end business process, can create so much value. Where BPA Software Offers the Most Value BPA software can be utilized to solve a wide range of business problems, but it can have the most impact in three areas. Situation #1: Where there is a significant amount of repetitive, labor intensive, and computerrelated effort, such as data entry, report generation, file maintenance, data transfers, data replication, error monitoring, and application/server trouble shooting. To illustrate this point, imagine our order entry process. The clerk waited for hard copy faxes to accumulate before manually entering purchase orders into the company s order entry system. This process is very slow an order might wait 24 hours or over a long weekend before it is entered. It is very costly and it is prone to errors entering the wrong ShipTo address can cause tremendous downstream delays and cost. In a BPA designed process, purchase order faxes are converted to e mail automatically, and e mails with order specific header information triggers automatic order entry. Optical character recognition (OCR) software scans the purchase orders for key customer information prior to automatic entry. In the event the OCR software didn t resolve any necessary information, the purchase order is routed as an exception to an order entry specialist. In contrast with the manual process described above, this process is very fast orders are entered in near real time. It is also much less expensive than having fulltime order entry personnel, and it is less error prone. When organizations and supply chains consider streamlining their operations, they need to first adopt a white board mentality. To design optimal business processes and activities, any consideration about the underlying systems must be avoided. Why? Because the underlying technology infrastructure is often the reason for the archaic, costly, and suboptimal business processes in the first place. Managers must design their processes with an idealistic attitude towards technology, adopting an attitude that technology will be an enabler rather than a limiter. It is always easier to backtrack from an ideal or optimal process design rather than incrementally improve a suboptimal one. Once an optimal business process has been white boarded by business managers, it s time for technologists to get involved. IT managers, network administrators, and application developers must determine how to implement the newly designed process. The more these individuals understand what BPA software offers, the better equipped they will be to implement the design in a timely and cost effective manner. 4

5 Situation #2: Where more than one application or system is involved in the business process. This common problem is encountered by almost every business. Our business process example included a manufacturing management application, a CRM system, and a shipping system. For the business process to function smoothly, these systems must interact. One approach to application integration involves extremely costly and time consuming backend data source integration. Options include enterprise application integration (EAI) or the creation of data warehouses and data marts. These types of implementations generally take several months to a year and cost six to seven figures. For companies that need to take quick action and deliver results on a timely basis, this is simply not an option. When systems don t interact, another approach companies often employ is to use people to manually integrate systems. For example, a production manager might manually query a CRM application to determine which jobs need priority. Such integration leads to slow, costly, and error prone processes. Processes and activities that involve repetitive human intervention for straightforward decision making are ripe for business process automation. The real power behind BPA software is that it can integrate quickly between disparate applications on the front end, as opposed to expensive and slow to implement back end integration. This enables BPA software users to quickly capitalize on new opportunities for eliminating waste, delay, and repetitive manual effort. BPA software enables inter application integration in days, not months. Furthermore, it does not require access to sensitive and secure data and systems which can often be a problematic hurdle for someone who is trying to solve a problem, not become a member of the Secret Service. Situation #3: Where there is an unwillingness to create and maintain expensive scripts. BPA software removes the need for almost all script writing. Moreover, it enables the cohesive centralized management and deployment of jobs (as opposed to scripts) across the enterprise. Nearly all IT managers understand the perils of writing code from scratch to solve specific problems. Application and script development always take much longer than initially estimated, and once users get a taste of the value of the application, they always seem to make more requests. Furthermore, supporting the application becomes a problematic when those who architected the solution depart from the organization. This problem is compounded when the IT operations are geographically dispersed. Custom code invariably ends up in multiple locations and can produce varying results in different environments. Supporting and maintaining applications in this scenario becomes completely unworkable. Best of breed BPA software addresses all of these issues. It provides a complete platform for developing automation applications, deploying them across the enterprise or supply chain, and managing them from a centralized location. For development, best of breed BPA software provides a rich scripting environment that eliminates the need to write code or understand syntax. It provides the tools a developer requires to integrate applications and streamline information flows to support the overarching business process. BPA allows developers to create sophisticated automation applications in a programming language that is universally understandable, thereby eliminating the problems involved with handing off the management of custom code from one person to another. Best of breed BPA software also provides easy to use mechanisms for deploying automation applications to an array of computers across the enterprise. BPA s event based triggers can initiate automation applications after all, optimized business processes are generally driven by events, not a pre defined schedule. 5

6 Finally, best of breed BPA software allows for the centralized storage of automation applications, so IT can standardize the entire automation lifecycle. Moreover, the BPA software should provide a centralized view into the performance of all the automation applications across the enterprise. This enables a core team to respond quickly, or even proactively, to any problems that arise with the applications. Conclusion Businesses can realize a tremendous amount of value by incorporating BPA into their business processes. BPA can eliminate many unnecessary repetitive, labor intensive, computer related activities that are expensive, time consuming, and error prone. About Network Automation Network Automation has over 13,000 loyal customers who have purchased its flagship product, AutoMate, the leading business process automation tool for the SMB market. AutoMate s users are mainly comprised of IT managers, administrators, and developers from companies spanning all industries and sizes. AutoMate is a comprehensive and flexible toolset for automating any business process involving human beings and computers. For 10 years, Network Automation has focused on reducing the need for human involvement in all types of business processes. Nearly any activity or process a human being can initiate and/or perform from a computer, AutoMate can do better, faster, and cheaper. The toolset also helps companies leverage their existing IT assets and legacy systems by enabling them to structure business processes as they should, not as disparate legacy systems dictate they must. The central idea behind AutoMate is to streamline business processes and drastically reduce business process costs by eliminating the human component and leveraging existing applications and systems. As most business processes owe more than 70% of their cost and 85% of their cycle time to human beings and legacy systems, AutoMate can add tremendous value. AutoMate does not require a user to know how to code or write script, only to have a basic understanding of logic flow. The idea is to enable more people to participate in the automation of their business, specifically business users and managers, not just coders. Drag and drop ease of use and plain English commands accelerate AutoMate development and deployment for higher returns on investment. 6

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