What is a process?Work is process……..
A structured, measured set of activities designed to produce a specific output for a particular customer, ‘internal or external’ or market (Davenport, 1993).
An organized group of related activities that together create a result of value to the customer (Hammer, 2001)
Problems: does not address cross-functional specifics of processes; managers see the step of a process within a function as the process, misses the enterprise view necessary for exemplary processes
Solution: Change description to a set of structured, deliberative, and collaborativeset of steps that cancross functional and firm boundaries that produce a firm’s outputs. These steps are increasingly technology-aided in definition, improvement, ‘execution’, and management. They also should have an enterprise, business process focus. In other words, what are the costs and benefits to the firmof each step and the final outcome (Spanyi, 2003 modified by Metlen 2007).
How to know the whole process: know how customers use your product, and staple yourself to an order (go through all the steps, are all steps adding value to the customer)
Why worry about what a process is: $$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
What is a step; an activity; an interface?
Step/task: definable portion of a process, often connected to a resource
Activity: what is done to accomplish a step/task
Interface: where one process interacts with another: share a common resource, output of one is input of the other (product: information, good, service)
Flow: where outputs of one process are inputs of next
Fit: multiple functions (processes) outputs are the deliverable (multiple products)
Shared: multiple processes share one resource
Example of a process: When a insurance claim arrives it is cross-checked against the customer database to determine the priority level of the customer. High priority cases go to Boston, low priority cases go to Seattle. Seattle processors check to make sure they do not receive any high priority cases before processing the case and sends any high priority cases to Boston. Cases are then processed, unless they need to be escalated (if the case cannot be processed in one hour). Escalated cases are processed by a supervisor. After processing, cases are sent to QC. After QC the process is finished if the case passes QC, otherwise it goes back to the processor.
What is process management?
Process Management (process owner activities: advocacy/influence, boundary management, collaboration, improvement, metrics, know relationship of process to stakeholder satisfaction)
1)Design/re-design (simulation)
Needs analysis & definition (simulation and history): goals, scope/boundaries, participants, constraints, schedule so design, implement and management follow nicely (Cost, time, quality, scopeproject management) Goals should be SMART (specific, measurable, attainable, realistic, tangible) Three C’s of leadership (clarity, consistency, and commitment)
Tech
Knowledge of Process logic (steps) schematic needed, Data flow logic, Resource consumption per step, business rules, interaction with other processes (often overlooked) and firm’s stakeholder satisfaction goals
How going to measure (quality control policy)
2)Implementation (simulation & BPM): probably not the big bang, will not come to a better mouse trap
Buy-in through communication in design and implementation
Rests on design
Take care of silent dissent as well as voiced dissent
7 c’s of implementation: common goal and measures, cross-functional commitment, continuity, clear communication, competent project management, credible coaching, celebration
i. First – Focus on common goals and measures
ii.Second – Ensure deep cross functional commitment
iii.Third – Ensure high level of continuity from the design team to the implementation effort.
iv.Fourth – Ensure clear communication of project goals and milestones to stakeholders impacted by the effort.
v.Fifth – Competent project management practices.
vi.Sixth – Perform training through a credible coach.
vii.Finally – Celebrate accomplishments.
3)Management/control (BPM & simulation): What most think of asprocess management managing the performance of the firm’s large, cross-functional processes in a deliberate and collaborative way.
Who is the owner, cannot be at too low of level or will keep silos and lose cross-functional involvement
Quality control statement (measures should link customer satisfaction drivers to financial outcomes, metrics should be visible (communication))
Training of resources
Evaluation/assessment
Accountability
Cross-functional involvement communication
Continuous training for executive and management on enterprise process management (so tenured employees do not forget and new employees learn so there is process management continuity)
4)Continuous Improvement (simulation & BPM)both revolutionary and evolutionary
Needs to be culture: obtain culture through metrics, rewards, and training
Take action on what find in mgt/control steps
Where are, why, where want to go, how going to get there, is it worth it
What are some challenges to process management?
Lack of enterprise view:Lack of understanding of how a process impacts delivery to the end customer
Lack of understanding that process is work, not only on production floor, but everywhere in the firm (those that help manage business)
Lack of skill
Lack of leadership
Past success
A challenge to process management is the heavily relied use of conventional wisdom. In order to overcome these challenges there must be a shift in conventional wisdom in respect to strategy, engagement, leadership, and growth.
Focus on strategy instead of execution
Not listening to stakeholders
What are BPM, BPMS, & BPMM?
Business Process Management (BPM).See BPM explained & Lombardi, what is the difference between workflow engines and BPM suites. And read BPM at
BPM is a structured, coherent and consistent way of understanding, documenting, modeling, analyzing, simulating, executing, and continuously changing end-to-end business processes and all involved resources in the light of their contribution to business improvement. (needs to talk about inputs and management of those processes)
Business Process Management System (BPMS) a BPM suit
Business Process Maturity Model, Business Process Management Model, Business Process Meta Management (BPMM) Just more about BPM
Business Process Execution Language for web services BPEL structured approach to specify business processes and interaction protocols
What is simulation?
A tool to model real life. We use discrete event simulation (interaction of interdependent steps that exhibit variation in completion time and quality of production(support and primary processes) over some time interval (sequence of random events each causing a change in state)). We can use Monte Carlo simulation which is applying different numbers of a distribution randomly as an input to some problem to develop a CI in a particular moment in time. There is also continuous simulation viewing model as a series of differential equations.
How does simulation, process management, BPM, & BPMM relate?
BPM has different parts (management mode….) simulation is a means of determining if a model of a system is accurate, then used as a what if tool, first step of BPM All are tools to improve processes so that goals (stakeholder satisfaction) are achievable
Is exemplary process management enough?Spanyi says no, you need a well thought out, practical (relative to the company’s skill set) mission, vision, goals, and strategy. I say exemplary process management enables these four corporate guidelines. If the process is ‘correct’, you will achieve the correct output. Spanyi preaches managing all processes, support and production, yet, even he misses the fact that these high level processes need managed. A hint of how embedded the following view is: process management is only for the production floor, and then only if it is efficient.
What is the difference between ‘more for less’ and ‘more with less’?
More for less: changing how resources are utilized to a more effective manner to eliminate waste and produce more units (both number and kind) with higher quality, faster, and at a lower cost. Giving the customer more value for a lower price while ‘earning more’
More with less: eliminate resource and force the remaining resource to produce more of the same old same old. Result are often not what was sought. Instead the results are often fewer items, lower quality, longer to produce, and higher costs per unit. Increasing revenue by decreasing cost is the goal, but often revenue is decrease along with costs to the extent that the bottom line is less.
What should be measured?
What ever gives a measure of how the firm is doing relative to stakeholder requirements
CSFQ (cost speed flexibility quality). Hard to get, lots of info on cash flow, sales, ROI, etc. but not on on-time delivery, accuracy, responsiveness, completeness of order, % who buy, items per sale, return buyer, referrals, customer satisfaction, end user satisfaction, field failure rate, manufacturing failure rate, milestone hit rate, time to concept time, and on-time delivery to request, on-time delivery, accuracy, responsiveness, and completeness” Reliability, durability, complaints
What metrics should be used?
Ratios that can be compared to a base line. Telling me that sales are $1M tells me nothing informative. The ratio of sales to expense does, or the ratio of sales to units, or man hours, or…… Even the measures of some attribute of a product can be expressed as a ratio, that is what Cp is, the ratio of process output relative to specifications.
What does it take to have an enterprise process focus?
History of process improvement; focus on customer satisfaction from the top; CEO have a passion for process management relative to satisfying the customer; is the firm interested in growth and competing; is there a competitive threat; is there cultural fit
How to build an enterprise level process schematic to identify the critical business processes that create customer value?Look at business from customers point of view, what does the company do for me, what don’t they do. Thus, you can ID the critical measures of performance that reflect customer requirements. Determine how the product is created. Create a logic flow picture of the process then fill in the other dimensions: data flow, resource consumption per step, business rules, interactions with other processes, link to goals, and QC. Once you have the main process detailed, detail the processes that support it (how does the data flow, how do you get, maintain, and train resources, how are BRs created and maintained, how is the core process supported. Do not name your processes by the functional area where most of the steps are executed, name based on output or how it helps with customer satisfaction. Verify data (just because someone wrote a program to grab data does not mean it is a correct program executing correctly.Do conceptual model fast, details will come latter. Do not spend too much time on detail on the first pass, it will be wrong. The detail comes after you have done a Pareto analysis and started working on the most critical/low hanging fruit processes.
- “the critical enterprise level business processes that create value;
- The critical few measures that define performance;
- A plan for improving and managing enterprise level business processes;
- Accountability for results; and
- A communication plan that inspires and moves people to action.”
What are the pitfalls of knowing where you are at?
Comfort, I am good, I do not need to move, self satisfaction, complacency, denial and self delusion. Businesses tend to set goals in relation to where they are, not where they need to be.
a.A natural tendency to either gloss over facts or take the easy way out when considering what customers really want. This means that the company uses their own promised date or delivery data rather than the customers requested date.
b.One of several members of the leadership team vehemently challenge the validity of the data on current performance and then acquiesce in the face of feedback from the majority of the leadership team, while never truly accepting the data on estimated current performance. This creates silent, stoic resistance.
What is the difference between promised, requested, and delivered data?
Hopefully nothing, but often what a person requests is misunderstood, so something else is promised and you are thinking about what you requested and frame what is promised to fit your request so you do not notice the difference, and when execution happens, another set is actually gathered and delivered. Validation is crucial. Or a request is made, know cannot meet it so promise another date, that date is accepted by the requester (no competition), and then you deliver later than promised (last time you get to)
What should go into a process schematic?
- As little as possible as quickly as possible and still capture the essence of the process. Then as time permits, add detail where/when necessary. Which will be the processes (or outcomes of processes) that stakeholders are complaining about the most that impact the bottom line the most. Business Process, Output, Measures, Performance Gap, Process Ownership, and Likely Action. Process flow, data flow, resource usage, interfaces, input flow, business rules
How do you influence without authority, and why do we care?
Use the terms personal and positional authority.
Simple, be a good person. Be a good communicator, which means listen well. Know a person’s problems and concerns with the process so that when you propose changes you can address those problems and concerns. One problem with BPM is that it enables real time process monitoring. Many people see that as a threat, as they have never been monitored before. Thus, monitoring has to be sold as a benefit relative to meeting their problems with the process, monitoring is for continuous improvement reasons, not to get ammunition to lay a person off.
The reason we care is that implementation of programs always is an avenue to program failure. Users have to be on board………and as the implementer, you will most likely not have positional authority to help drivethe implementation. Even if you did, relying on positional authority without personal authority usually produces the same implementation results as no authority in the face of resistance program failure.
Assume all are potential allies (we communicate with our allies), know your goals and priorities, know the goals and priorities of others (and why, know their world), know what each person in the mix wants (relevant currency), deal with relationships, create win/win scenarios (give and take).
- Spanyi says , “influence is based in part on being clear about your goals, understanding other’s point of view, seeking out viable options, and understand the big picture and the principles of fair exchange. “
How does one implement processes?
You have to start in design and make sure you understand user’s needs, how the process output will better serve stakeholders and goal attainment, and then make sure you accomplish the meeting of stakeholders’ needs. It may not be apparent to the stakeholders how the process meets their needs, communication……
First – Focus on common goals and measures
ii.Second – Ensure deep cross functional commitment
iii.Third – Ensure high level of continuity from the design team to the implementation effort.
iv.Fourth – Ensure clear communication of project goals and milestones to stakeholders impacted by the effort.
v.Fifth – Competent project management practices.
vi.Sixth – Sixth – Perform training through a credible coach.
vii.Finally – Celebrate accomplishments.
How do you know if a process is a good process(they are never good enough)?
Stakeholders do not complain, as the ‘correct product’ is produced (never happens to a high enough degree job security for process analysts)
How do you know if a process needs to be redone?
a.They always do, but stakeholder complaints can direct you to where to start.A process needs to be redone when it focuses more on the “bottom line” or traditional financial measures, where the mindset is, “What does it cost and how much revenue did we make?” instead of, “How well do we serve our customers,” and, “How much repeat business are we getting?”
b.Excel test how many excel models and data repositories are there scattered across the company to track various processes. If there is one, then the process needs redone.
What is the process improvement process?
Steps and activities
- “a concise, compelling vision for the new design
- A cross functional process map of the way in which business should be conducted in the future to achieve goals
- A clear matrix of performance measures that should be monitored in the future
- A concise set of recommendations for change to achieve stated goals
- A document which details changes in roles and accountabilities such that there is clarity on who needs to do what in the new process
- A compelling business case (NPV)
- A high level implementation plan that indicates who will need to do what by when to install new business practices, process change, and related technology, with approximate milestones”.
Spanyi says, agree on process boundaries, set clear and measurable improvement goals, and appoint best people, ID realistic constraints, set a schedule, charter to implement not just design