Business Process Management

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Alexia Newman
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1 Business Process Management 0

2 BPM Is About Delivering Better Business Outcomes Real world examples - ROI of 462% (over an average payback period of 1.56 years) - 60 percent cost savings in systems delivery and 27 million in annual returns over two years.* 66% of BPM funding comes from business. Companies using BPM invest more in growth and transformation initiatives. BPM is Not about improving a process for its own sake. *Source: 2013 BPM Excellence Awards Nominees

56 years) - 60 percent cost savings in systems delivery and 27 million in annual returns over two years.

3 Gartner's Definition of BPM Definition BPM is a management discipline that treats processes as assets that directly contribute to enterprise performance by driving operational excellence and agility. Tenets Visibility Accountability Adaptability Attributes Explicit business process models. Into the flow and status of work. To all process participants. All phases of process life cycle. Into metrics and true business performance. Policies and constraints Business leaders own process change, not IT. Eliminate cross-functional responsibility gaps. Clear line of sight for metrics and outcomes. At the pace of business, versus IT delivery cycles. "Build to change" mentality. Continuous process improvement. 2

All phases of process life cycle. Into metrics and true business performance. Policies and constraints Business leaders own process change, not IT.

4 The History of Process Management: A Quick Summary 1 Scientific Management Taylorism Time and Computerized Process Flow Motion Deming O&M OR IE TQM JIT Workflow Package Applications as Best Practice Business Agility Intelligent Business Operations BPR Six Sigma Lean 3 SOA BPM EDA BPP IBO

Workflow 1960 1970 1980 1990 2 Package Applications as Best Practice 3 2000 Business

5 The Process of Process Management Is a cycle of Continuous Process Improvement (CPI). CPI drives business agility the ability of an enterprise to sense and respond effectively and efficiently to market dynamics. An integrated suite of BPM tools can make this cycle fluid (seamless) and enable business and IT roles to collaborate on a "build to change" approach to applications. Monitor 4 Optimize Execute Define Discovery Implement Design Simulate Analyze

6 BPM Initiatives Vary in Scope Quick-Win Process Improvement Projects Process Redesign Projects Business Transformation Initiative Level of Change Incremental Significant Sweeping, radical Typical Scope Narrow, within a function Across multiple functions and systems Cross-organization, cross-platform and systems Time Required Less than three months Three to 12 months More than one year Governance Process owner, Executive sponsor, or business process analyst Process owner Steering committee

multiple functions and systems Cross-organization, cross-platform and systems Time Required Less than three months Three to

7 BPM Suites: An Integrated Set of BPMTs for "Doing BPM" System Management and Administration Process Execution and State Mgmt. Engine Model-Driven Composition Environment Business Rule Management in-line and Offline Simulation and Optimization Process Component Registry/ Repository Document and Content Management User and Group Collaboration Business Events, BI and BAM System Connectivity

Engine Model-Driven Composition Environment Business Rule Management in-line and Offline

8 Business Process Maturity Model 7

9 The Changing Nature of Work 8

.. automation Nonroutine work Ad hoc execution task-specific management

10 Question: Are Some Kinds of Work Immune to Industrialization? Routine work Mechanization... assembly line process modeling... automation Nonroutine work Ad hoc execution task-specific management Productivity Quality Consistency Scalability High marginal costs High management overhead Unpredictability Inconsistency

11 Common Work Styles Nonroutine work Unstructured Process Routine work (Cannot be planned in advance; uncertain; hard to automate) Structured process (Can be planned in advance; predictable; repeatable; can be automated) Formdriven workflow Straightthrough processing Guided navigation Case management Problem solving Innovation and discovery Permit requests Mortgage origination University admissions Bank acct. opening Hospital admission Self-service check-out Service request handling Determining optimal pricing Crew scheduling Stock trading Insurance claims Social services benefits Fraud detection Criminal investigations Medical diagnosis Workforce allocation Budgeting Emergency management New product research Scientific discovery Business transformation Strategic planning

12 Conventional Limits to Automating Nonroutine Work Definitely automate Maybe automate Avoid automation? Automation costs increase due to exceptions and complexity Routine work Nonroutine work Variability, creativity, social intelligence Automation benefits decrease due to lack of repeatability

Automation costs increase due to exceptions and complexity Routine work

13 Case Management 12

14 Case Management Solution Design Is Architecturally Challenging

15 Case Management Solution Design Is Architecturally Challenging Workflows are complex, recursive, parallel. Lots of conditional logic. BPMN diagrams become unwieldy. Cases have a lot of data (and unstructured data!) Cases often have relationships to other cases! Case workers may be resistant to ANY automation.

16 Workflow and Data Requirements Distinguish Four Types of Cases Structured Unstructured Workflow New Account Opening Vendor Mgmt. Customer Service Lab Research Quality Testing Loan Processing Background Check Product Change Request University Admission Security Breach Records Request Project Support Patient Care Negotiated Documents Legal Case Work Social Services Compliance High-value Proposals Peer Review Fraud Detection Criminal Investigations Customer Onboarding Insurance Claims Processing Benefits Admin. Video Production Reimbursement Approval Structured Key: Orange: Blue: Green: Red: Data Service Request (Workflow Heavy) Investigative (Data Heavy) Incident (Collaboration Heavy) Process to Decision (Rules/Policy Heavy) Unstructured

Negotiated Documents Legal Case Work Social Services Compliance High-value Proposals Peer Review Fraud Detection Criminal Investigations Customer Onboarding Insurance Claims Processing

17 Critical Capabilities for BPMSuite-based CMFs, Weighted by Case Type Critical Capabilities Use Cases Investigative Incident Mgmt. Service Request Process to Decision Supports a broad range of content types and content interaction services. Supports a broad range of collaboration services to facilitate individual and group interactions among all (internal and external) case participants. Interoperates well with other, external, content (structured and unstructured data) and process services. Provides intelligent and versatile on ramps and off ramps for incorporating content. Provides vertical- and horizontal-specific data models, nomenclature, hierarchies and case life cycle management. Provides application adapters to industry- and domain-specific environments, including legacy, industry, Web and social data sources. Provides comprehensive and highly configurable role-based user experiences. Business role-friendly dashboards, metrics and reporting. Leverages models for easy adaptability of the solution. Supports a broad range of case orchestration, from highly structured to highly unstructured flows. Proven deployments with 100,000 cases or more annually. As of October 2013 = Heaviest Weight = Lighter Weight = Lightest Weight

Supports a broad range of collaboration services to facilitate individual and group interactions among all (internal and external) case participants.

18 The Future of BPM Digital Business 17

19 The Nexus of Forces Is Driving Digital Business and Process Reinvention Interacting the way your customers and employees prefer Meeting expectations of ubiquitous access and consistent experience Making critical datadriven decisions in realtime 18

prefer Meeting expectations of ubiquitous access and

20 What Is Big Change? Zone of Big Change Novelty This is a well-known best practice. We've never done this before. Nobody has ever done this before. Volatility Stable environment with a slow predictable pace of change. Our people and systems barely keep up with the pace of change. Our people and systems can't keep up with the pace of change. Disruption This isn't disruptive. We just need to do what we already do but do it better. This is enormously disruptive to our business operations. This completely disrupts our business operations, business model and value chain and potential existence. Complexity of Scope Few entities with few moving parts. Strategy-to-execution must deal with a moderate number of entities. Strategy-to-execution involves numerous entities with multiple moving parts.

Disruption This isn't disruptive. We just need to do what we already do but do it better. This is enormously disruptive to our business operations.

21 Digital Business Focus Outcomes Entities Disruptions Technology

22 The Future of BPM Intelligent Business Operations 21

23 Three Technologies That Make Business Operations More Intelligent at Runtime Active Analytics BAM: Real-time KPIs for marketing and sales managers Process monitor: Send alerts for stalled process instances Operations monitoring: Track fleet, reroute trucks Situation awareness Process Orchestration Workflow: Trigger the next activity in the process at the right time Smarter flows On-Demand Analytics Predictive analytic: Find best-next-action upselling offer Rule engine: Approve this customer's credit? Better decisions Run-the- Business Operations A C D CRM order capture Manual approval ERP fulfillment Shipping and logistics

24 The BPM Discipline Can Facilitate Intelligent Business Operations in One or More Ways BPM analysis and design for understanding the business and for continuous process improvement. Continuous process monitoring to detect and correct runtime problems. Runtime workflow and process orchestration to coordinate activities. A C D

servers, PaaS, other BAM/ CEP Dashboards and Alerts Event data from local operations

25 Active Analytics Can Provide Continuous Intelligence About Internal and External Conditions ESB, MOM, adapters, app. servers, PaaS, other BAM/ CEP Dashboards and Alerts Event data from local operations Observational event data ("context") from anywhere WWW Mobile RFID, Internet of Things Social: Employees, Public and Customers Business Partners Other Departments Sensors

26 Questions?

IBM Software IBM Business Process Management Suite. Increase business agility with the IBM Business Process Management Suite

IBM Software IBM Business Process Management Suite Increase business agility with the IBM Business Process Management Suite 2 Increase business agility with the IBM Business Process Management Suite We