Graduate Program in
Business Information Systems
BIS 581
Business Process Management
Lecture - 7
Aslı Sencer
Department of Management Information Systems
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Business Process Management– 7
Management of the BPM Processes
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Business Process Management
“BPM is the achievement of organization’s objectives through the
improvement, management and control of essential business processes”.
Achievement: Realizing the strategic objectives as outlined in the
organizations’ strategic plan
Organization: Refers to an enterprise or parts of an enterprise; a discrete
business unit .
Objectives: Range from strategic goals of the organization to the individual
process goals. BPM is not an objective in itself; rather a means to
achieving an objective.
Improvement: Making the business processes more efficient, effective and
flexible.
Management: Performance management of the process and people.
Control: Managing the end-to-end business processes that involves full cycle
of Plan-Do-Check-Act.
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A Brief History of BPM
The idea that work can be viewed as a process and improved is hardly new.
• In early 1900’s Frederick Taylor developed industrial engineering and
process improvement in manual labor and production processes.
• Shewart, Deming, Juran and others introduced statistical process control.
It involved measuring and limiting process variation, continuous
improvement, empowerment of workers to improve their own processes.
– Total quality management (TQM) at Toyota Production System
– Lean manufacturing in American firms
• Late 1990’s: Enterprise Resource Planning (ERP) systems introduced
organizational focus, but did not solve an organization’s process issues like
efficiency and effectiveness.
• Late 1990’s and early 2000’s: Customer Relationship Management (CRM)
was introduced with extensive focus on the customer view. This provided
focus on the front office but did not improve the back office processes.
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A Brief History of BPM (cont’d.)
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•
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1980’s and 1990’s: Six-Sigma approach created by Motorola and popularized by
GE. Six Sigma seeks to improve the quality of process outputs by identifying and
removing the causes of defects and minimizing variability in manufacturing and
business processes. A six sigma process is the one in which 99.99966% of the
products manufactured are statistically expected to be free of defects.
Late 1980’s: Lean manufacturing: The core idea is to maximize customer value
while minimizing waste. Simply, lean means creating more value for customers
with fewer resources.
1990’s: Business process reengineering was promoted by Hammer and Champy
(Harward Business Review article: “Don’t automate, obliterate”) and applied by
western firms during economic recession and strong global competition. Process
management focus moved to non-production, white collar processes like order
management and customer service. BPR introduced
– The radical redesign and improvement of work
– Attacking broad, cross functional processes
– Stretch goals of order of magnitude improvement
– Use of IT as an enabler of new ways of working.
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Questions About BPM
• Is technology an essential part of BPM?
– In the right circumstances and when it can be
justified.
• Are process modeling and management tools
useful for achieving process improvements in
non technology circumstances?
– It is difficult to complete complex process
improvement projects in time without the use of
these tools
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Role of BPM Tools
• There is a danger of organizations believing
that once they have purchased a process
modeling tool, it will solve all their problems
and process improvements will just follow.
• Actually a BPM tool is a software; without a
modeling methodology or framework, skilled
resources to use it and a genuine commitment
from organizational leadership, it is useless.
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How is BPM conceived by the
involved parties?
Currently BPM is used by
• Some vendors who only focus on the technology solution of
process improvement
• Other vendors who think of BPM as business process
modeling or business performance management
• Some consultants who use BPM to continue their message on
business process reengineering
• Some managers who want to jump on the BPM bandwagon,
with no idea where it is going
• Some process analysts who use BPM to inflate their process
modeling aspirations
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BPM is
• More than just a software
• More than just improving and reengineering your
processes - it also deals with managerial issues.
• Not just hype - it is an integral part of management
• More than just modeling - it is also about the
implementation and execution of these processes,
which requires analysis.
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BPM is NOT
Just process reengineering
Based on perceptions – it uses real data
Focused on a component – it has an holistic
approach
An individual task – includes all staff in the
organization
A departmental task – includes all
departments in the organization
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The Iceberg Sendrome
Theoretical analysis which takes quite a long
time is the small portion of the iceberg.
Perceptions
1/10
The success of the real implementation and
achievement of the business benefits depend on the
organizational change management and control of the
impacts on the people.
Fear/courage
Cultural differences
Reality
9/10
Sympathy/Antipathy
Tabus
Resistance to change
Irrational behaviors
Unwritten rules
Conflicts of benefits
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Forms of Resistance to Change
There are four different types of resistance:
Reject the problem: There is no such problem!
Reject the significance of the problem: There is a problem
but it can be ignored!
Reject the solvability of the problem: There is a problem, it
is significant, but has no solution!
Reject his role in the solution of the problem: There is a
problem, it is significant, it has solution, but I do not have
the authority to solve it.
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The Main Component of BPMPeople
The success of BPM will be approved by humans
involved in the process
 BPM should be transparent
 Continuous empowerment should be provided
 Poeple should be convinced about the possible benefits
 Responsibilities should be clear
 Feedebacks should be taken regularly and taken care of.
“We had improvement programs, but the real difference came when we
decided it was no longer a program, it was a business strategy.”
Stephen Schwarts- IBM
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INNOV8: IBM BPM Simulation Game
•The INNOV8 BPM simulation game brings IT and business together for process
model innovation. Both IT and business professionals understand that processes
are critical to success. They just look at them from different perspectives.
INNOV8, the IBM Business Process Management (BPM) simulation game, gives
both IT and business players a better understanding of how effective BPM
impacts an entire business ecosystem. INNOV8 also demonstrates how a more
instrumented, interconnected and intelligent world supports process
improvements and working smarter to help build a smarter planet.
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INNOV8: BPM Simulation Game
•Inside INNOV8 Online, you will encounter three different game scenarios:
–Smarter Traffic : Evaluate existing traffic patterns and re-route traffic based on
incoming metrics.
–Smarter Customer Service: Using a call center environment, players develop more
efficient ways to respond to customers.
–Smarter Supply Chains: Evaluate a traditional supply chain model, balance supply
and demand and reduce environmental impact.
•Players quickly see how practical process improvements can help meet
profitability, customer satisfaction and environmental goals while addressing real
problems faced by municipalities and businesses today. And when they're done
playing, they can compare scores with other players on global scoreboards.
• Players observe the impact of practical process modifications on the
profitability, customer staisfaction and environmental goals.
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INNOV8: BPM Simulation Game
•Smarter Supply Chains
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Group Exercise: INNOV8
•Enter www.ibm.com/innov8 and click Get ready to play
INNOV8 online
•Choose Smart Supply Chains game
•You should note all your decisions and your performances
regarding your goals. After making three simulated trials
you will select the best decision and continue to the next
step.
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