Business Process. Automation. Automation. David Chernicoff Susan Perschke. sponsored by

Transcription

1 Business Process Automation Managing Cost in Your Automation Enterprise David Chernicoff Susan Perschke sponsored by

2 i Contents Business Process Automation Managing Cost in Your Enterprise Chapter 1: What Is Business Process Automation?... 1 Executive Overview... 1 What Is BPA?... 1 Understanding the Difference Between Business Process Automation (BPA) and Business Process Management (BPM) Run Book Automation... 6 How Does BPA Work?... 6 Integration... 6 Orchestration... 7 Automation... 7 What Is BPA's Impact on Business Workflow?... 8 BPA and ROI... 9

3 1 Chapter 1: What Is Business Process Automation? Executive Overview In chapter 1 we outline the basic information necessary to understand what business process automation (BPA) is and how it can be of benefit to your organization. We look at the basic concepts of BPA, how it works, how it fits into an existing corporate environment, and its impact on business workflow and the bottom line. We consider BPA in the context of the related concepts of business process management (BPM) and run book automation (RBA). We define BPA as both a business process and an IT component; often a server-not unlike a database server or communication server in its importance to the organization, identifying the roles for which BPA is best suited, and explaining what IT departments need to look at to assess where BPA can fit in to their environment. This review will help you understand the pressing need for BPA in your organization and provide the information that will allow you to begin to evaluate which processes are best suited for conversion to an automated rollout. What Is BPA? Business workflow is a task-based process. From simple data entry to the more complex manipulation of that data, we can almost always define the business workflow process as a series of discrete tasks. The various combinations of these discrete tasks make up your business processes. These tasks can be broken down into their component actions, which means they can be automated. Efficiently and effectively automating these types of tasks is what BPA is all about. Consider the existing workflow process in your business. I f you take a step back and look at it dispassionately, you likely will see that you can define repetitive tasks in many areas points in the workflow where the same action is constantly repeated. Perhaps the data changes or the point at which this action occurs in the workflow isn t constant; but overall you can see a significant percentage of user and IT actions that fit the description of repetitive process. Further examination of your business workflow will often reveal that these repetitive tasks take considerably more time than expected. Repeated manual data manipulation, for example, is rarely an efficient use of resources and most easily demonstrates the value of the BPA concept. Basic tasks that currently use human intervention, such as purchase order processing, can often be delayed until the specific employee tasked with handling that process is available, and the actual requirements of the task could easily be automated. At its simplest, we can define BPA as removing the human element from existing business processes by automating the repetitive or standardized process components. But don t let this simple explanation fool you. BPA capabilities range from automating a simple data-entry-manipulation task to building complex, automated financial-management processes using existing applications and a good BPA tool. Nor should we let the obvious simplicity of the BPA concept underscore the benefits cost reduction, elimination of human error, and having people do what people do best: make decisions, analyze data, and provide customer service.

4 2 Business Process Automation With BPA, you can optimize and streamline your business processes by automating process components. By improving the performance, accuracy, and efficiency of your key business processes, you make your organization more efficient and responsive to customer and employee needs. Good BPA software can build systems that proactively respond to changes in the data they are responsible for, thus reducing IT workloads and improving overall efficiencies. BPA is the basic component of an enterprise-wide automation and management scheme for both business and IT workflow: Don t presume that the term business limits the scope of BPA tools. In fact, IT processes are often excellent candidates for the automation of repetitive tasks. The examination of your corporate enterprise will uncover a broad range of tasks suitable for the application of BPA (Figure 1) and give you the chance to realize the benefits this approach can bring to both core business and IT processes. Identify Business Problem Analyze Business Need Develop Business Process Automate Tasks That Would Otherwise Require Human Interaction Deploy Business Process Figure 1: Where BPA fits in to the business process. To recap, finding the right BPA solution for your business can make your business processes faster and more efficient, robust, and flexible. As with any business problem, applying the right tool as the solution will have farreaching positive effects in your enterprise.

5 Chapter 1 What Is Business Process Automation? 3 Understanding the Difference Between Business Process Automation (BPA) and Business Process Management (BPM) The differences between BPA and BPM are two-fold: terminology and focus. Part of the problem with the first issue, terminology, is that, as a concept, BPM is not well defined. So let s first establish a working definition for BPM based on the following, which some parts of the U. S. Government use: Business Process Management (BPM) is the concept of shepherding work items through a multi-step process. The items are identified and tracked as they move through each step, with either specified people or applications processing the information. The process flow is determined by process logic and the applications (or processes) themselves play virtually no role in determining where the messages are sent ( sacwis/glossary.htm). This definition makes clear that BPM is the overview process. The goal of BPM is to enable managers to get a handle on the processes as a whole how they fit and work together, and, on a macro scale, how they reach the eventual goal. In contrast, BPA focuses more on the micro scale. With a good BPA solution, you can automate the business processes that a BPM solution monitors and manages. However, the above definition is just one of many that you will find. For example, many vendors consider BPA simply a component of a BPM system. Although this relationship is true, issues can crop up when some vendors imply that you can implement BPA only as part of that BPM system. Management organizations have their own definitions of BPM, which usually focus on aligning business processes with the need to deliver specific products or services to business clients. This means that significant attention is on people-driven rather than technology-driven business processes. And this view yields a very different approach from the nuts-and-bolts improvement process that BPA tools advocate. Technology vendors use BPM to describe actual management tools designed for monitoring and managing the plumbing and machinery that makes up the technology side (software and hardware) of the business process. Some vendors define BPM very specifically, using it as their phrase for the overall software development process for application delivery by end-user customers, rather than just those pieces of the process that focus on automation. SAP, for example, uses the term Process Management Lifecycle to describe and demonstrate the process of implementing new business processes or optimizing existing business processes. SAP breaks its BPM down into these phases: 1. Analyze phase a. Analysis of the current environment and any current processes that might be in place b. Identification of needs and definition of requirements 2. Design phase a. Evaluation of potential solutions to meet the identified needs b. Business process design c. Business process modeling

6 4 Business Process Automation 3. Implement phase a. Project preparation b. Blueprinting c. Realization d. Final preparation e. Go live and support 4. Run and Monitor phase a. Business process execution or deployment b. Business process monitoring The phases cover the entire business lifecycle of a process. Although some of these actions line up well with what you would be doing with BPA, the BPM focus is less on the actual process automation and more on the management and monitoring of the business process as a whole. New Processes Process Governance Analyze Existing Processes Run/Monitor Organization People Technology Design Implement Figure 2: SAP BPM Lifecycle As you can see clearly from the graphic in Figure 2, SAP incorporates both the people and technology issues that BPM represents, and demonstrates a basic BPM philosophy: ongoing optimization of the business process. Hardcore BPM advocates make a clear point that business processes always will need to be tweaked and tuned to respond to the prevailing business practices and climate.

7 5 It s also important to note that there are, as yet, few if any recognized standards to define either BPA or BPM. In most cases the vendors themselves select the area they feel their products should be identified with. Some major vendors look at BPA in terms of discrete parts of existing applications such as, in the case of IBM, automating forms via the Lotus Forms application while they see BPM as a part of their overall management structures. This brings us to the second difference between BPM and BPA. BPM focuses on the conceptualization of a complete business environment, the end-to-end optimization of the business workflow Figure 3), without focusing on the tools necessary to accomplish this optimization. In contrast, BPA vendors offer customers the tools they will need to build more efficient processes, in most cases without disrupting the operation of the current business environment and, ideally, without needing to invest in the development of in-house programming and application-development skills. Business Process Analysis Business Need Identification Business Process Design and Development Identification of Processes Suitable for BPA Development of BPA Tasks Business Process Monitoring Automated BPA Optimisation Business Process Management Figure 3: This high-level BPM workflow diagram highlights areas where BPA can be used. BPM and BPA are complementary technologies and concepts, but you can use BPA to make existing processes more efficient, not only on an enterprise-wide scale but even for desktop users simple workflows. Deploying a BPA solution can be the first step in a corporate BPM deployment, or the final goal for implementing more

8 6 Business Process Automation efficient business processes on a much smaller scale. Finally, a third, related concept that is relevant to the topic, called run book automation, deserves a brief overview before we look more closely at how BPA works. Run Book Automation Run book automation (RBA), a term coined by the Gartner Group, is similar to BPA in that both technologies are used to automate processes. But in the case of RBA, the focus is on IT responsibilities (which is part of the reason the process is also known as IT process automation). For example, RBA software often is used to perform IT processes that go beyond the simple job-scheduling features found in operating systems, and RBA includes any number of features that focus on the administration and maintenance side of IT business requirements. Automated service start and stop, data backup, and ed report generation and transmission, all across multiple clients or servers, are common tasks of RBA software. Event tracking, log monitoring, and changerequest management are all features often included in RBA products. With these capabilities, the IT department can monitor, control, and automate actions that it otherwise would need to do manually. RBA aides IT departments in meeting quality-of-service and uptime goals, along with proactively monitoring mean-time-to-failure (MTTF) and mean-time-to-recovery (MTTR) statistics, which they can use to provide cost justifications in IT budgets. RBA should not be confused with the automation that you can find in networkand operations-management software. Those tools usually require specific modules to drill down into individual applications. Automation that is available with such tools is only for automating alerts or actions within specific supported applications and is rarely usable across applications. The goal for RBA is similar to that for BPA: Take the manual, redundant tasks out of the hands of users and automate them, to free those users up for other activities. The RBA market tends to be separated into products that are specific to a certain vendor or management product, and to those products that attempt to work across the many different network- and system-management tools commonly found in IT departments. With this general foundation about BPA and related concepts and technologies, let s look at how BPA works. How Does BPA Work? Three activity classes define a BPA solution: 1. Integration 2. Orchestration 3. Automation BPA applications tightly tie these three components together, enabling them to be used to automate applications on almost any scale, from simple keystroke automations, to complex integration of multiple applications with completely automated operation. Good, solid techniques and application of these three areas of responsibility allow the automation software to scale as the enterprise and business needs grow. Integration Integration is the fundamental enabling concept for BPA. BPA allows applications and operating systems not only to read data that the systems produce, but also to pass data between the component applications of the business process, and to modify the data as necessary.

9 Chapter 2 Piecing Together Fragmentation 7 Based on the parameters outlined when the BPA process is configured, BPA tools make use of this integrated data exchange to make decisions and to make changes to the process to keep it updated and optimized. Given that the purpose of BPA is to tie together processes that are occurring anywhere in the computing environment, regardless of application or location, integration is the glue that allows the BPA processes to run. Orchestration Orchestration, as its name implies, is the process that gives the business side of the house the input on how things will work, and to direct the BPA process. The orchestration engine works hand in hand with BPA s integration capabilities both to read and report on the steps that are being taken in any managed process and also to provide the decision-making capability that is critical to an effective BPA solution. From the top down, orchestration provides the tools for designing the BPA solution, the intelligence to apply the information acquired via the integration that the solution requires, and ties together what can be an incredibly diverse selection of applications and systems. The process of orchestration also enables the ability to bring tasks that exist across multiple machines and perhaps even across different business silos or branches all under one umbrella that is the business process itself. Orchestration is the key to maintaining ongoing optimization of the BPA solution. Automation Automation is the whole point of implementing a BPA solution. With repetitive manual tasks soaking up a disparate amount of resources, the bottom line for the technology of a BPA solution is to deliver a solution that eliminates or even just minimizes the amount of manual intervention in these types of tasks. Orchestration and integration unite with automation to deliver the capability to provide a rules-based process of automatic execution that can span multiple systems and enable a more effective, nimble, and efficient business process (Figure 4). Business Process Automation Integration The Fundamental Enabling Process for BPA Orchestration The Direction, Integration and On-Going Optimization of the Business Across the Enterprise Automation A BPA Process That Takes the Manual Repetitive Tasks and Makes the Process More Efficient Figure 4: The three pillars of BPA A More Effective and Efficient Business Workflow

10 8 Business Process Automation What Is BPA's Impact on Business Workflow? Let s look at the average type of business workflow that requires human intervention. For example, in most cases there is a point at which data needs to be entered or manipulated. Often, this data is drawn from other sources already available to the user in electronic form. So the user needs to move the data from its current location to its desired location, move the data between applications, or generate additional data using the existing data and applying formulas or reporting tools to the existing data. The data that the user has massaged and manipulated is then delivered to other applications or users, with the help of all sorts of delivery mechanisms that can range from uploading a file to a server, to entering the data into a Web publishing system, to ing a report to a manager. This process occurs anywhere from hundreds to thousands of times daily in the average business environment, and it is fundamentally fraught with potential problems. Repetitive tasks are just that: repetitive; and although machines are very good at this sort of thing, people rarely are. Constant repetitive tasks often lead to inattention which, in turn, leads to errors in the process. And people are human: They focus on other activities during the business day, such as going to lunch, grabbing a cup of coffee, answering the phone, or just responding to s from a coworker. During such times, their attention cannot possibly be focused on doing those repetitive, information-processing tasks that are a staple of the business world. Simple errors, such as spelling mistakes, to major errors, such as using outdated data to generate updated reports, are often simply the result of a few moments of inattention. And, of course, people take vacation, get ill, and are often not on-site for any number of reasons, all of which directly impacts getting their work done. Properly implemented BPA solutions reduce the number of repetitive tasks that users must get involved with. A task that has been automated now puts less impact on the users who interact with the task. Automating as many tasks as is reasonable within a business process streamlines that business solution and makes it more capable. With automation, larger amounts of information can be handled faster and more efficiently than if the same processes were still being done manually. The bottom line for business workflow (Figure 5) is that companies that comprehensively implement and apply BPA in areas where it can be most effective will see a significant streamlining and optimization of their business workflow processes. Their workflow becomes more effective and flexible, and better able to support business growth and expansion.

11 Chapter 2 Piecing Together Fragmentation 9 Order Received Order Received Order Entered Order Entered CC or PO? PO Data Manually Entered CC or PO? CC Approved PO Sent for Approval PO Approved CC Approved BPA Automated PO Approval Process Order Sent for Fulfillment Order Sent for Fulfillment Unautomated Process Figure 5: A sample BPA workflow

12 10 Business Process Automation BPA and ROI Automated processes don t get tired, lose focus, make mistakes in data handling, or spend time on other business activities. They allow the business to take the time-consuming, repetitive tasks, which are better handled by the computer anyway, out of the hands of the users and refocus those users efforts on other business activities that can be more in line with business goals and needs. Doing this multiplies the effectiveness of both users and applications. But let s look at the direct, specific effects and improvements that BPA can have on ROI, not just the ROI of the BPA software, but the effective ROI of other applications in place in the user s environment. 1. Reducing errors. By automating the movement of data between applications, common errors that occur in the process of rekeying data entry are eliminated. Issues related to using the wrong data sources or sending erroneous data to other users, clients, or customers are eliminated. Once the BPA process has been tested and deployed, there are simply fewer opportunities for common user-introduced errors to have an impact. This reduction in errors results in saving both time and money that would otherwise be spent fixing the errors and any problems that the errors introduce further down the process chain. 2. Improving performance and process effectiveness. In many cases, tasks that must be done manually are the bottleneck in the process. Automating those manual tasks speeds up the effective throughput of the application, thus allowing the existing software solutions to deliver their results more efficiently and effectively. This combination can reduce the need for additional spending to meet the needs of the business for that specific process. 3. Making users more efficient and effective. By automating tasks that were consuming personnel resources, those resources can be redirected toward core business needs. This allows the business to effectively gain available man hours that it can apply to other business projects without additional expenditures. People can focus their energies on the tasks they do best, allowing the computers to handle those that machines are best suited for. 4. Making the business more responsive. With a good BPA tool, the business can easily automate new applications and processes as they are introduced, and so allow the business to become more responsive to business and customer needs, without significant new expenditures. BPA deployment can take days/weeks instead of the months required to implement a manual process change. Furthermore, a good BPA platform will enable an organization to implement BPA without requiring highly technical development resources making the automation application life cycle much easier to implement and maintain. Fundamentally, effective BPA results in an improvement on ROI for many aspects of the business model, in turn increasing the effectiveness of both new and existing applications that are suitable for use with a BPA solution. ROI is usually met with proper implementation within 3-6 months, if not sooner, depending on the scale of the implementation and intended use. Typically, the larger the implementation, the quicker the time to recoup investment for example, a large manufacturing/distribution company might digitize its ordering process with BPA. The elimination of paper and storage costs alone would pay for the deployment.