INTRODUCTIONPertemuan 1

Matakuliah : M0734-Business Process ReengineringTahun : 2010

What is BPM ?What is Business Process Management ?

“The achievement of an organization’s objectives through the improvement, management and control of essential business processes”

(Jeston and Nellis, 2006)

More than just technology

Improving or reengineering your processes and dealing with managerial and organizational issues

Not just hype – it is an integral part of management

Modeling + implementation + execution + monitoring

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Improving Processes before Automating ThemThe first rule of any technology is that automation applied to an efficient operation will

magnify the efficiency..The second is that automation applied to an inefficient operation will magnify the

inefficiency.(Bill Gates, Microsoft Corporation)

• Executives see their processes as a ‘black box’. They don’t know the details, but

somehow the processes produce outcome.

• The processes and associated people are treated like sacred objects : executives cannot or do not want to discuss the efficiency and effectiveness or ask the tough questions.

“If business process inefficiencies could be easily solved by automating them, why are consultants often called in after an organization has purchased an expensive automated workflow solution that has failed to ‘solve’ the problem?”

“Why do automated solutions fail to deliver their expected business benefits?”

Black Box Syndrome

Looking at the Edges Syndrome

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Main Drivers and Triggers behind BPM Initiatives

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Who Should be Involved in BPM ?Integral Management

Business Process Improvement Management• BPM Project Manager• BPM Program Manager• Center of BP Excellence Manager• Chief Process Officer

External BPM Experts• Set-up project, program and Center of BP Excellence• Monitor progress of project, program or Center of BP Excellence• Monitor performance and identifying areas of improvements• Conflict resolution and project/program revival• Support for management, act as consultant or right-hand advisor• Evaluating (and auditing) projects and programs

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BPM Critical Success FactorsLeadership

BPM Experienced Project Manager

Alignment with Organization Strategy

Process Foundation

Technology Foundation

Structured Approach to BPM Implementation

People Change Management

People and Empowerment

Project Initiation, Execution and CompletionContinuous Improvement

Benefit Realization 7

BPM Critical Implementation Aspects

Speed

Regatta of Sogeti, The Netherlands, Metaphor

Efficiency

Balance

Cohesion

Process

Management

“Speed (effectiveness) and efficiency through balance and cohesion” 8

The BPM Implementation Framework – an Overview

Using the BPM Implementation Framework

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BPM Project Success Pillars

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BPM Implementation FrameworkBPM Implementation Framework• Organization Foundation• Process Foundation• Technology Foundation• BPM Foundation• Elaboration• Improvement• People and Technology

Development• Deployment• Monitor and Benefit Realization• Continuous Improvement

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Process Centric Organization

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BPM Project Initiation ApproachesStrategy-driven Approach Operational-initiative Approach

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BPM Project Implementation Scenarios :

•This occurs in the least BPM-mature organization, and is where there is a partially informed business manager who is not yet committed and is not paying much (or any) attention to BPM within the organization. This scenario could be a project under the guise of process improvement, and BPM may not be mentioned at all.

•This is where there is a fully informed business manager who has yet to be totally convinced of the benefits of BPM and is willing to try it out on a small scale to start with before making a full commitment.

•This will be selected by the most BPM-mature organization. The organization and business managers will be totally committed to a process-centric organization, and BPM projects are simply business-as-usual activities or projects.

•This is the next level of organization BPM maturity, and is where there is a fully informed business manager who is totally committed to the implementation of BPM within the organization or business unit he or she is responsible for.

Under the Radar Pilot Project In the

Driver’s SeatBusiness As

Usual

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BPM Project Implementation ScenariosSelecting BPM Project Implementation Scenarios

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BPM Project Implementation ScenariosCharacteristics BPM Project Implementation Scenarios

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BPM Implementation Framework- a Detailed Look

BPM Implementation FrameworkOrganization FoundationProcess FoundationTechnology FoundationBPM FoundationElaborationImprovementPeople and Technology DevelopmentDeploymentMonitor and Benefit RealizationContinuous Improvement

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Organization Foundation Phase

Organization Foundation Phase :Why ?How ?OutputsRisks

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Why ?

• Direction – an understanding over the overall organization direction so the project’s trajectory can be aligned with it

• Discovery – motivational driver in discovering better and more efficient way for the processes in the future

• Destiny – sense of belonging, emotional edge to the organization strategy

Setting up proper foundation for the understanding of the organization strategy, vision, strategic goals, business and drivers by the project team members

Organization Foundation will provide the following attributes :

Organization Foundation

Information Decision

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How ?

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Step 1 : Internal and External Aspects of the Organization

Internal aspects of the organization

External aspects of the organization

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Step 2 : Strategic Objectives

Key Questions to ask :

What ?

How ?

• Vision : what does the organization strive to ‘be’?• Mission : what is the organization in business to ‘do’?• Goals : what does the organization plan to accomplish?• Objectives : what results does the organization plan to deliver?

• Strategic intent : how are we going to achieve the goals and objectives?• Implementation strategy : what methods or approaches are used to reach theGoals and performance targets?

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Step 3 : Impacts on Processes

How the organization strategy impacts business processes?

Strategic Choice :• Operational Excellence• Customer Intimacy• Product Leader

Operation Excellence Customer Intimacy Product Leader

Key Processes Order fulfillmentProcess Engineering

AcquisitionsDeliveryMarketing Communications

Product DevelopmentTechnical ServicesMarketing Management

Organization and Skills Centralized decision – makingSupply chain partnering

Shared trust between sales team and back-office operational staffIncreased partnering skills

High level of product innovation (patents) and product developmentIntelligence at local level

Key Process Variable Low costsLow lead time

FlexibilityStaff empowerment

FlexibilityProduct

Management Systems Key client relationshipsCost improvementsActivity-based CostingReal-time costs

Customer equity measures (e.g. lifetime value)Customer Satisfaction,Share management

Focus on growth in sales and profitabilitySpecialized schedule targets

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Step 4 : Strategic Measurements

Measure and monitor the progress of the strategy execution

• The financial perspective (objectives, measures, targets, initiatives)• The customer perspective (objectives, measures, targets, initiatives)• The business process perspective (objectives, measures, targets, initiatives)• The learning and growth perspective (objectives, measures, targets, initiatives)

Provide, from middle management downwards, more specific and personal objectives

Evaluate initiatives and projects by their contribution to these strategic measures

Balanced Score Card

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Step 5 : Complete the Plan

“10 percent increase of turnover”

“the organization follows an Operational Excellence Strategy”(this will be taken into consideration while evaluating existing processes and(re)designing new processes)“the customer has a single point of contact for all his or her questions”(all processes will be described as end-to-end processes)

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Step 6 : Communicate

Obtain Sign-Off

Commitment from Key Stakeholders

Proper Change Management Approach to changes to the organization foundation

Communicate Organization Strategy and how it impacts the business processes

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Outputs Organization’s Vision and Mission Organization’s Goals, Strategic Intent

and Objectives Organization’s Implementation

Strategy Business Model Context, including

Customers (type and volume of customers)

Services/products Suppliers/partners Key differentiators Resources

Key differentiators of the organization

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RisksRisks Mitigation Strategy

Reinventing the Organization Strategy

Select the appropriate BPM project scenario for the organization to follow, and stick to the related depth on the strategy review; do not go any deeper than is required

Indefinitely waiting for information on the Organization Foundation

If the information is not forthcoming, make assumptions and get them validated; if no answer is supplied, escalate or re-scope the project

No commitment from senior management

Start small-scale improvements and achieve quick wins, and obtain commitment incrementally; ask the project sponsor for assistance

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