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Field Project onA Study on Business Process Modelling : Mapping to FMCG IndustryIntroductionNeed of the ProjectSupply chain is the backbone of FMCG industrySupply chain structure is ComplexStandardization of supply chain is the needSupply chains emphasize the process approach

Objective of the ProjectUnderstand the complete Purchase Order Processing followed in FMCG industry Develop a business process map of that using Data Flow Diagram (DFD)

Supply Chain StructureWhy DFD?Based on advantages- disadvantages- uses, DFD best suits for this business problem

Literature ReviewResearch paperSupported AreaHanil Jeong, Hyunbo Cho, Albert Jones, Seongjun Lee, Seokcheon Lee (Journal of Service Science and Management, 2012) , Business Process Models for Integrated Supply Chain Planning in Open Business Environment , IEEE publicationDeveloping business process models that reflect realistic business scenarios and enable integrated supply chain planning in the open business environmentWu Bei, Shanshan Wang, Jun Hu (2000), An analysis of Supplier Selection in Manufacturing Supply Chain Management , IEEE publicationFramework for supplier selection an evaluation model of supplier selection Guijun Wang, Stephen Miller (2008), Intelligent Aggregation of Purchase Orders in e-Procurement , IEEE publicationDeveloping aggregate purchase order process to reduce costsMadhu Bala and Dinesh Kumar (2005), Supply chain performance attributes for the fast moving consumer goods industry, IEEE publicationIdentification of the supply chain performance attributes that are relevant to the Fast Moving Consumer Goods Yonglei Tao, Chenho Kung (2003), Formal definition and verification of data flow diagrams, Journal of Systems and SoftwareA formal basis for the DFDBusiness Process ModelingDefinitionIts an abstract representation of a business process and it closely replicates the realityUses- understanding, communicating, improving, developing, automating, managing or executing a processBenefits- Allows analysis and understanding of the process flows Helps managers know if there is room for further optimization and efficienciesEnsures consistency, traceability and focus towards a shared goalBusiness Process MethodologiesFlow chartData Flow DiagramsRole Activity Diagrams Role Interaction Diagrams

Data Flow DiagramDFD are diagrams that show the flow of data or information from one place to anotherA DFD is a graphical representation that is appropriate to show system functionality, with its underlying processes and flow of data The functional decomposition of DFDs enables multiple levels of representation by creating child diagrams for each activityIt shows how information enters and leaves the process; what activities change the information; where information is stored within the process, and the organizational function to which the activity belongs

NotationAdvantagesThe multiple levels of representation facilitate changes and system improvementFunctional decomposition enables each process to be subdivided into sub processes, which can be further subdividedEasy to use technique due to the small number of elements required in order to construct a model.The expressivity of the modelling elements facilitates the construction of a DFD model for inexperienced usersEasy to understand both conceptually and in presentation

DisadvantagesEach process only show the flow of data, not materials or workflowDFDs do not provide the capability to describe process sequencing or process control mechanisms

UsesProcess at the logical level. This means that we will be able to describe what a process will do, rather than how it will be doneDFD are used in the functional model to specify the meaning of operations and constraints and show functional dependencies

Data Flow Diagram

Business Process Mapping: FMCG Industry

DFD for Complete Purchase Order ProcessSub processes InvolvedSales ProcessReceiving ProcessAccounting ProcessCustomer places PO with Sales DepartmentSales department places PO with vendor in case of insufficient inventory and processes customer PO immediately or after inventory is replaced depending upon available stockReceiving Department receives order sent by vendor, checks for any discrepancy and updates inventory dataAccounts department handle payments for vendor and customers DFD of complete PO processMain tasks

Fill out standard PO formCheck stockGenerate Vendor POGenerate customer billing copy, Packing Slip, Invoice

Business Process Mapping: FMCG IndustryDFD of operations of Sales departmentDFD for Sales ProcessBusiness Process Mapping: FMCG Industry

DFD for Receiving ProcessMain tasks

Record vendor packing slipRecord vendor invoiceCredit inventory received

DFD of operations of Receiving department

Business Process Mapping: FMCG IndustryDFD of operations of Accounting departmentDFD for Accounting ProcessMain tasks

Apply customer paymentSummarize bills and archive paid billsGenerate vendor complaintGenerate vendor payment and archive paid billsFindingsData flow diagram representation cannot work for all kind of business processes. Depending on its advantages-disadvantages-uses, it should be used at proper situations

DFD modelling of purchase order process helps in standardizing the process, thus removing any confusions or ambiguities in its application at any point in the supply chain

DFD modelling is done after process reengineering of general purchase order process. For eg- Vendor analysis process, Customer Credit check process These reengineerings help in making cost effective decisions for the company.

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