Business Process Modeling

Business Process Analysis

In order for a business to improve its performance it must understand how it does business. It must convert the “how” into defined processes, which must be able to have their performance measured, and the results used to make subsequent improvements.

The roots of most common business problems lie deep inside business processes, and stem from two main reasons:

1) Business processes are not aligned with business strategy and goals. A lot of organization activities may not contribute directly or indirectly to what the organization needs to do to meet its goals. Business strategy is less visible or apparent at lower levels and in the finer details of organization processes.

2) Business Processes are not well defined in many cases, resulting in confusion and lack of clarity about what needs to be done in particular situations.

A common business goal example for most (if not all) organizations is maximizing revenues through sales and minimizing costs incurred in the process. While this is very important aspect of strategic decision making at the top level, lack of implementation at lower levels contributes to a lost cause. Aligning organization-wide processes to fall in line with business goals could not be more relevant since it directly impacts the bottom line!

The solution through Business Process Analysis

1)       A good starting point to align business processes with strategy, down to the finest detail, is to first model them. During the process definition stage, a lot of missing links and information gaps appear

2)       The second stage is analyzing and readjusting the processes through some or all of the following ways:

• Streamlining processes, to create optimized, efficient processes and removing redundancies (removing irrelevant activities that do not contribute to goals directly or indirectly)
• Defining and implementing standards for commonly used processes. Doing the similar activities the same way every time increases efficiency. Think about McDonalds’ Burgers – they have the same high quality at every outlet because they use standardized processes!
• Integrating smaller sub processes to create a bigger process that accomplishes one complete business activity. The advantage of using process integration is to include the whole system into the model, and avoid the negative effects that sub optimization can result in. For example, optimization of a single process unit may not necessary lead to an improvement of the whole system. Integration also accounts for provisions for sharing common resources, data or services.

3)       The third stage is incorporating business strategy onto the processes, which is a way of looking at the processes in terms of what they need to achieve in order to meet organizational goals – be it increasing  revenues or cutting costs (or optimizing time, energy or resources). It involves analyzing the gaps between current state models and those desired and creating a systematic plan for migration.

4)       The fourth and final stage is implementation, where the agenda identified through the migration plan is put in action in different phases.

Benefits of Business Process Modeling

The case for Business Process Modeling

1. Better knowledge transfer, training and outsourcing
   Documented processes enable easier outsourcing and better knowledge transfer when key personnel leave or new employees join the organization
2. Better delegation of roles and responsibilities
   Well defined processes mean well defined roles and responsibilities
3. Better Analysis for improvement
   Streamline processes for efficiency, remove redundancy and duplicity
4. Better Change Management
   Understand how making changes to one process affects other processes and manage change better
5. Better strategy execution
   Map strategy onto processes to create an action plan to achieve business goals
6. Better Replication
   Use standardized processes for doing repetitive activities the same way, making them efficient and less prone to mistakes
7. Better sharing of resources
   Integrate processes to share operations, product or customer data or services like customer care, resulting in cost savings and improved service
8. Better automation
   Use process models to derive automation specifications

Standards for Business Process Modeling

The Business Process Modeling Notation (BPMN) is a standard for business process modeling, and provides a graphical notation for specifying business processes in a work-flow. BPMN provides capabilities to define and understand internal and external business procedures through a Business Process Diagram, which enables communicating these procedures in a standard manner.

1. Offers notation that is understandable by all business process users (process analysts, IS developers, process managers…)
2. Fills gap between business models and their implementation

Business Process Diagrams

To understand more about how you can manage your business better with the aid of Business Process Diagrams, please feel free to forward us your queries:

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