What does playing golf, driving to work, or writing a report have in common? They have a start and an end. They consume or transform inputs into outputs. They are repeatable and ongoing. In essence, they are all processes. As with all processes, they can be analyzed, measured, and improved to be the best as they can be at a given point in time.
Most all processes can be improved! Think of any organization that stands out in your mind about being the best at something. Why are they the best? What are they doing well? If you were able to pull back the curtain on the organization, you probably would find they not only have great processes, but they practice “business process management.” They focus on all the processes and activities that deliver value to their customers and optimize these processes for the good of the organization.
What is Business Process Management (BPM)?
So, what is Business Process Management? Business process management provides governance over the organization’s processes. It is an enterprise-wide structured approach to managing the processes that create the products and services that provide value to the customer. A more detailed definition can be found in ABPMP International’s Guide to The Business Process Management Common Body Of Knowledge (BPM CBOK®). Accordingly, business process management “is a disciplined approach to identify, design, execute, document, measure, monitor, and control both automated and non-automated business processes to achieve consistent, targeted results aligned with an organization’s strategic goals.”
Business process management means managing business ‘sideways’ from a process perspective. Managing sideways contrasts with the traditional approach of managing vertically. Imagine a building where you were not allowed to use a hallway to go to a different department, but rather you had to take an elevator up to a different level and then go down a separate flight of stairs to get to the cubicle you needed in another department on your floor. That is unfortunately what is often found in the corporate world. It is easy to get consumed by the latest issue, budget, deadline, or annual review and lose focus on whether the customers are getting the value they paid for.
“Managing Sideways” does not mean that we stop managing our organizations. It means that must manage BOTH the organization and the process. The good news is, if we manage the processes well, the resulting cash flow makes it a lot easier and a lot more fun to manage our organization. The health of the process translates directly into the health of the organization. The comment “aligning activity with order-to-cash” refers to the fact that everything a business does is to make money based on supplying some type of good or service to a customer. All processes within an organization should support the transformation of an order through the collection of cash. As you probably know, processes lead to the customer whereas functions lead hierarchically to “the boss.”
Why is Business Process Management Important?
The ultimate goal of any organization is to make the organization more efficient and effective, basically more productive. Business Process Management drives greater productivity (e.g., reduced costs, employee productivity, increased revenue, cost avoidance, etc.) by focusing on the entire process for optimization, not just pieces. The vehicle for increasing productivity is usually a project. The product of such a project will be a modified process, process automation, or both.
These essential elements – productivity, project management, product management, and process management – necessarily go together to realize business process management productivity gains.
The productivity triangle shows how all these pieces fit together.
- Productivity: Improved productivity can reduce costs, increase revenue, increase employee and customer satisfaction, etc.
- Project Management: Ensures projects are planned, managed, and implemented effectively.
- Product Management: Ensures requirements are clearly defined to resolve the right business problems.
- Process Management: Ensures processes are defined, monitored, carried out effectively, and continuously improved.
In addition to productivity, business process management…
- Improves business agility by having the ability to change processes quickly as needed to meet the needs of our ever-changing customer needs to stay competitive.
- Provides better visibility into value-producing processes which are often ignored in more siloed organizations.
- Ensures stronger accountability where the cross-functional process is owned and managed by a process owner.
- Provides opportunities for continuous improvement and performance.
- Allows for easier and faster transmission of business knowledge.
Why is it Important for BAs and PMs to Understand Business Process Management?
As a business analyst or project manager, it is key for us to understand business process management since so much of our project work involves business processes. We often find ourselves working on initiatives to improve a process or to develop software to support existing processes. If we do not understand the process, we may develop software that does not meet the needs of the stakeholders, miss requirements, include out-of-scope requirements, or just not understand the overall impact of the changes we are making to a process.
If you are interested in getting practical hands-on experience in business process management, go to www.watermarklearning.com to find out more about Watermark’s Business Process Management Certificate program. You may take all 3 classes, or alternatively, take 1 or 2 courses of interest.
- Business Process Management Foundations (1-day) – provides an overview of business process management.
- Business Process Modeling (2-day) – learn and practice creating various models from enterprise models to detailed process models.
- Business Process Improvement (2-day) – Practice analyzing processes using various tools and techniques, identifying improvement areas, and designing new processes.
Organizations & References
Want to learn more? Here are some great resources and organizations.
- BPM Institute: bpminstitute.org
- Association of Business Process Management Professionals International (ABPMP International) https://www.abpmp.org/
- Object Management Group – https://www.omg.org/oceb-2/index.htm