ISIT332 Business Process

Management
School of Computing and Information Technology
University of Wollongong
 BPM lifecycle

1. Process identification
and opportunity assessment
2. Process discovery (as-is)
3. Process analysis
4. Process re-design (to-be)
5. Process implementation
6. Process monitoring/controlling

Dumas M, La Rosa M, Mendling J, Reijers HA (2013) Fundamentals of business process

management. Springer, Berlin
BPM lifecycle

• Process identification:
– what business processes are we intending to
improve?
– What process performance measures are we using to
measure the value delivered by a process?
• Cost, cycle time, quality
– The output is the process architecture.
Exercise 1.3

• Consider the student admission process described in

Exercise 1.1. Taking the perspective of the customer,
identify at least two performance measures that can be
attached to this process.
BPM lifecycle
• Process discovery: as-is process models
– Textual description
– Flowcharts, e.g., BPMN
– The level of details to be included in a process model depends on
the purpose.
• Process analysis
– Identification and assessment of issues and opportunities for
process improvement.
– Assessment of issues goes hand-in-hand with measuring the
current process
Exercise 1.4

• Consider the student admission process described in

Exercise 1.1. Taking the perspective of the customer,
think of at least two issues that this process might have.
BPM lifecycle
• Process re-design
– Identify the potential remedies for the issues
– A difficult job
• Process implementation
– Put the to-be process into execution
– Organisational change management
– Process automation
• Process monitoring and controlling
– Is adjustment needed?
Exercise 1.5

Given the issues in the admission process identified in

Exercise 1.4. What possible changes do you think could
be made to this process in order to address these issues?
Process Identification
Process Identification

What?
1. Define an organization’s business processes
2. Establish criteria to prioritize the management of these processes
Why?
1. Understand the organization
2. Maximize value of BPM initiatives
Output: Process Architecture
– Captures business processes and their scope
– Serves as a framework for defining priorities and scope of subsequent
BPM phases (e.g. modelling, redesign and automation).
Process identification steps

• Designation phase
• Evaluation phase (a.k.a Process selection)

• We are not studying every process!

• Where great value created
• Where significant trouble presented
• Subject to the dynamics of time
Process Identification Steps
1. Designation phase
– Enumerate main processes
– Determine process scope: boundaries (horizontal and vertical)
and interrelationships (order and hierarchical)
2. Evaluation phase (a.k.a. Process Selection)
– Alignment with strategic objectives
– Health (e.g. performance, compliance, sustainability…)
– Culture & politics
– Feasibility to being successfully improved
– Risk of not improving them

After Davenport (1993)

The designation phase

• Coarse-grained view vs. fine-grained view on

processes.
• A trade-off between impact and manageability.
• Identify broad processes that need complete overhaul.
• Identify narrow processes that are subject to continuous
fine-tuning.
Exercise 2.1

• Explain how the trade-off between impact and

manageability works out for broad and narrow
processes, respectively.
How many is enough?

• As a rule of thumb, 10 -20 is a manageable number.

• Very large organisations might have hundreds.
Relations between processes

• It is important to understand relations between

processes
– Hierarchical relations: a process is a sub-process of
another process
– Sequential relations: upstream process and
downstream process
• To gain an understanding of how the performance
of a process is related to that of another
• General guidance available: ITIL, SCOR, PCF
The evaluation phase

• Various criteria for evaluation

– Importance: which processes have the greatest
impact?
– Dysfunction: which processes are in the deepest
trouble?
– Feasibility: how susceptible are the processes to
process management initiatives?
• Do these criteria lead me to the same set of
processes?
• Should all processes that are dysfunctional, of
strategic importance, and feasible to manage be
subject to process management initiatives?
Process architecture

• A process architecture is a conceptual model that

shows the processes of a company and makes their
relationships explicit.
Process landscape development

• The case type dimension classifies the types of cases

that are handled by an organisation.
– A case is a product or a service that is delivered to the
(internal or external) customers., e.g., an insurance, a toy
• Cases can be deliberately classified using any number
of properties, e.g.,
– Product type
– Customer type
– Channels
• The function dimension classifies the functions of the
organisation.
• A function is something that an organisation dies.
– e.g., purchasing, production, sales, etc.
• A function can be hierarchically decomposed.
• Steps for developing a process architecture
– Identify case types
– Identify functions for case types
– Construct one or more case/function matrices, and
– Identify processes
Identify case types

• Select case properties that will lead to different

organisational behaviours, e.g.,
– Product type
– Service type
– Channel
– Customer type
– Location
• Consider the case of a bank …
Exercise 2.2

• Consider the case of a bank and the classification

criteria product type, service type, channel, and
customer type, in how far are these criteria related to
each other?
Identify functions for case types

• Identify functions that can be performed on each case

type.
• Reference models available for classification, e.g.,
APQC’s PCF.
• Functions can be further decomposed but determining
when the decomposition ends is important.
– Functions correspond to organisational units.
– Include different functions for different roles.
Exercise 2.3

• Consider the case of a university and the level one

processes listed in the APQC’s PCF. What kind of more
specific functions does a university typically cover in
categorise 2.0 Develop and Manage Products and
Services and in 5.0 Manage Customer Service?
Construct case/function matrices
• Put a ‘X’ in the cell if the corresponding function can
be performed for the corresponding case type.
Identify processes

• The entire matrix forms one big process which will be

split up when rules apply
– A horizontal split separates processes between columns
– A vertical split separates processes between rows
Guidelines

• G1: If a process has different flow objects, it can be

split up vertically.
• G2: If the flow object of a process changes
multiplicity, the process can be split up vertically.
• G3: If a process changes transactional state, it can
be split up vertically.
• G4: If a process contains a logical separation in
time, it can be split up vertically.
Guidelines

• G5: If a process contains a logical separation in space,

it can be split up horizontally.
• G6: If a process contains a logical separation in another
relevant dimension, it can be split up horizontally.
• G7: If a process is split up in a reference model, it can
be split up.
• G8: If a process covers more functions in one case type
than in another, it can be split up horizontally.
Case study
G1

• If a process has different flow objects, it can be split up

vertically.
– A flow object is an object that flows through a business
process
– Typically each business process has a single flow object
– If multiple flow objects can be identified in a business
process, the process should be split up
G2

• If the flow object of a process changes multiplicity, the

process can be split up vertically.
– A single flow object is sometimes used
– Multiple flow objects of the same type are sometimes
used, e.g., batch processing
– If the number of flow objects that is processed per
activity differs this may be a reason for splitting up he
process.
G3

• If a process changes transactional state, it can be split

up vertically.
– A business process goes through transactional states: the
initiation, the negotiation, the execution and the
acceptance state.
– A transition in a process from one state to another is an
indication that the process can be split up.
G4

• If a process contains a logical separation in time, it can

be split up vertically.
– If its parts are performed at different time intervals.
– Once per customer request
– Once per day
– Once per month
– Once per year
G5

• If a process contains a logical separation in space, it can

be split up horizontally.
– If it is performed at multiple locations and is performed
differently at those locations.
• Organisations should aim to make their processes more
uniform across different locations but sometimes there
is no other choice.
G6

• If a process contains a logical separation in another

relevant dimension, it can be split up horizontally.
G7

• If a process is split up in a reference model, it can be

split up.
– A reference process architecture is an existing process
architecture that is pre-defined as a best-practice
solution.
G8

• If a process covers more functions in one case type than

in another, it can be split up horizontally.
– Whether a process has many more crosses in one column
than in another.
Completing the process architecture

• Processes on level one defined, what are missing?

– The consumer-producer relationship
• which consumer-producer relationships exist between
processes with respect to the same flow object?
– The level of detail for level two
• The various steps that are taken within each process
• The organisational units that are involved in carrying these
out
– The level of detail for level three
• Alternative paths, potential exceptions, iterations, etc.
• Data that are being handled
• Systems that are being used
Mortgage payment process
Questions?