What is Business Process Management?

BPM Enterprise.com

A business process management system used appropriately provides crucial benefits. It can cut cost (well… supposed to lah), increase efficiency and enhance customer service. BPM can also drive up revenue. Designed to provide real-time visibility into business functions, business process management software is ideal for achieving a greater return from today’s process-intensive industries.

More specifically, a BPM solution can reduce the time needed to complete a business process, the number of steps required to perform tasks or the number of errors made in implementing an activity. Business process management may also reduce the number of employees needed to complete a job, thereby allowing a company to utilize those employees for additional growth in other areas. In addition, you can apply BPM practices to automate routine procedural tasks and improve call center performance.

Tracing BPM’s Roots

Business process management isn’t new. BPM traces its roots to the original technological systems designed to improve organizational workflow and re-engineer processes. Frequently, the adoption of business process management grows out of experience an organization has with other process improvement methods such as Six Sigma and Total Quality Management (TQM).

A BPM solution aspires to address the entire process, functioning with a minimum of human intervention. Generally speaking, the software manages business processes by accessing and integrating data repositories, database management systems and software applications (yikes!! I need my ICT brainees … yooohooo!). Business process management tools provide real-time visibility and monitoring of activities. In addition, the newest BPM systems allow human interaction within business process flows.

BPM systems are ideal for process-intensive vertical industries such as financial services, insurance, healthcare and government. BPM systems also useful in more horizontal applications like human resources, manufacturing and production. Business process management systems work well in several scenarios: operations with processes that require manual intervention at specific points in applications (should this mortgage or insurance claim be approved?); straightforward processing situations with no manual intervention (having accounts payable data set off the printing of checks); and routine business function operations (sending out notification to various departments when a new person is hired and needs a computer, insurance forms, tax forms and the like).

Meeting the Challenges of Business Process Management

Although business process management focuses on the management aspects of processes, BPM tools and technology can expedite the adoption of the practices.

Before investing in a business process management solution, you need to decide if BPM is the right approach for your organization.  Analyze your business process closely. Are they definable step by step? You also need to analyze your organization. Is it culturally adept at handling change? Implementing a BPM program incurs major upheaval within an organization. Do you have the resources to help people adapt?

If you decide that a business process management solution is right for your organization, you face two major challenges. The first is modeling your business applications and systems. Many businesses don’t know their business systems well enough to do this without extensive research. Others know their systems but don’t know if their systems are extensible — able to be integrated with other systems for the exchange of data.

The second challenge is finding a business process management system that fits your specific business needs. A good BPM solution provides a framework that can cross organizational divisions and boundaries to link disparate business applications, both inside and outside the company. (This is where SOA — service-oriented architecture — comes into play. Its purpose is to allow for inter-application communication through Web-based services).  Since BPM tends to focus on mission-critical aspects of an operation, it’s important to find software or services that provide features and functionality pertinent to your company and supported by a BPM vendor committed to helping you succeed.

Select a Balanced Project Team

Creating a BPM project team will help you deal with these challenges. The team’s key responsibilities include dealing with major business process management deployment considerations, setting project milestones, and marshalling buy-in from the stakeholders  — anybody touched or affected by its implementation. Without buy-in up and down the line, business process management won’t succeed. In addition, the team will evaluate candidates’ products, select the winning solution, and monitor the installation.

The team should include members from a cross-section of the organization with a balance of information technology (IT) and business people. You may also want to include a business process management consultant who has experience implementing BPM solutions. He or she can help guide the team through the minefields it’s sure to encounter when evaluating candidates and rolling out business process management software.

Choosing the Right Business Process Management Systems

Choosing a BPM solution involves four major steps:

1. Determining your needs,
2. Analyzing your application,
3. Selecting a business process management solution, and
4. Determining return on investment. All are responsibilities of the project team.

First, determine the company’s specific needs. This step requires the team to do extensive research into the design of processes. The information it gathers during this stage helps determine the right business process management solution. The key is unearthing major business drivers. There’s no reason to make investment in BPM to gain improvements in processes that have little impact on the bottom line. At the same time, the team lays the general groundwork needed to implement a business process management solution.

Second, analyze the specific application requirements. After analyzing the application, the team will have a better idea of the core requirements needed in a business process management system as well as the BPM specific features and functions that are most important to the company. The team should also review specific implementations to see if they’re common to your industry. If so, you may be able to purchase a “packaged” BPM program, one with a track record in the field. Packaged BPM solutions can save time and money during installation, since it reduces the amount of customization that is required overall.

Third, select a business process management vendor/system. Develop a list of candidates and then narrow the list down to a couple of finalists based on your business requirements. Ideally, you’d like to identify a vendor that can provide an “end-to-end” solution for business processes comparable to your own.

The team needs to examine the business process management software from a technology standpoint. The BPM solution should have at the very minimum these critical features: design tools and user interfaces; an application programming interface (API) framework/layer; a process automation, workflow and rules engine; and data transformation capabilities. It should also have connective services and business activity monitoring and management components.

In addition, review the business process management vendor itself. What is the vendor’s business strategy? How financially solvent is it? Who are the business process management vendor’s reference customers? Are their BPM applications similar to yours? How much support does the BPM vendor provide? How well does the BPM vendor’s culture — practices and philosophy — mesh with your company’s culture?

Fourth, determine the business process management solution’s return on investment (ROI). Calculating ROI helps decide if installing the business process management solution is worth it. In making this decision, look at financial benefits other than merely cost savings. These may include a new way of implementing a business process that might generate additional revenues or enable a company to enter a new market segment.

Tying It Together

The true promise of business process management technology lies in its ability to tie together different business functions involving the interaction of multiple people and different systems. First, however, you need to decide if a BPM solution is appropriate for your organization. If so, choose a business process management project team featuring a balance of IT people and business users. The project team spearheads the review, selection and implementation process. Once the business process management solution is installed, the BPM project team continues monitoring it to ensure that it’s meeting your company’s needs. A well-implemented BPM system provides both cost and revenue benefits, while boosting your organization’s competitiveness.