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Business Process Modelling 28 February 2013
Purpose
The workshop aims at stimulating dialogue,
answering questions and providing practical
demonstrations to enhance your business
and process modelling skills.
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Points Covered
3
BPM
Mandate Introduction
BPM Business
Modelling
Process
Modelling
Process
Inventory
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“The heart of managing a
business is managing its
processes.”
Beyond Reengineering
by Dr Michael Hammer
Introduction
• Process modelling is useful, powerful and
potentially very accessible.
• But, with so many analysts, consultants,
publications and vendors weighing in with
their own perspective and opinions, it can
be very confusing.
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BPM Mandate
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White Paper on Transforming Public Service Delivery (Batho Pele White
Paper)
Visioning of a single Public Service
Outcomes based approach and in specific outcome 12
– output 3
Government’s approved framework for service delivery improvement
BPM Mandate in Public Sector
Batho Pele White Paper
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• This White Paper is directly applicable to those parts of the public sector, both national and provincial, which are regulated by the Public Service Act, 1994
• However, it is relevant to all areas and employees of the public sector regulated by other legislation, such as local government and parastatals, teachers in education departments, as well as the South African Police Service, South African National Defence Force and the Intelligence Services
• … it is expected, therefore, that all sectors of public administration will agree to follow the principles set out in this White Paper
Outcomes-based Approach
• Outcome 12 of the outcomes-based approach as adopted by Government aims to establish “an efficient, effective and development oriented Public Service and an empowered, fair and inclusive Citizenship.”
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Outcome 12, Output 3
• This output deals with business processes, systems, decision rights and accountability management
• In the case of business processes the DPSA stipulates that indicators must be identified for measuring the efficiency and effectiveness of business processes
• Targets for improvements in this regard must be set, the indicators must be measured, and plans for improving business processes must be developed and implemented
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BPM Defined
BPM is a management approach for
creating an agile organisation capable of
transforming business processes in pursuit
of extraordinary results
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BPM includes the broad collection of activities concerned with:
• identifying
• classifying
• modelling
• measuring
• analysing
• improving and
• controlling
of processes with the ultimate goal of servicing the customer
better.
Functions of BPM
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Dimensions of BPM
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External Environment
Strategy (Business Modelling)
Process (Process
Modelling)
People
Information
Technology
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Business Modelling
“A business model describes the rationale of
how an organization creates, delivers and
captures value” - Alexander Ostwalder & Yves Pigneur -
Business Model Benefits
• Facilitates description & discussion
• Provides a shared understanding
• Simple, relevant & intuitively
understandable
• Does not oversimplify complexities of how
enterprises function
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Business Model Canvas
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Key Activities
(KA)
Value
Proposition
(VP)
Customer
Relationships
(CR)
Customer
Segments
(CS)
Key Controls (KC)
Key
Resources
(KR)
Key Partners
(KP)
Channels
Cost Structure (C$) Revenue Streams (R$)
Exercise
Develop a Business Model for the HR
Function of an Organisation
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Key Activities (KA)
• The KA building block describes the most
important processes an organisation must
perform to make its business model work
• These are the most important core and support
processes required to operate successfully
• KA differ depending on business model type
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Key Activities (KA)
Categories of KA:
• Production – designing, making and delivering a product
in substantial quantities and/or superior quality
• Services – designing and delivering a service of superior
quality
• Problem Solving – coming up with new solutions to
customer problems
• Platform/Network – networks, matchmaking platforms,
software and even brands can function as a platform
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Process Defined
• The word “process” is defined in the
dictionary as “a series of actions, changes,
or functions bringing about a result.”
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What is a Business Process?
“... a process is simply a structured, measured
set of activities designed to produce a specified
output for a particular customer or market...
A process is thus a specific ordering of work
activities across time and place, with a beginning,
an end and clearly defined inputs and outputs: a
structure for action.”
- Thomas H. Davenport -
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Process Characteristics
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Output
Business
Rules Resources
Customers
Inputs
Suppliers
Value-added
transformation
A process always
has a name and
occurs over time
Process Characteristics
• Is triggered by an external business event.
• Is comprised of all the activities necessary to provide the appropriate
business outcomes in response to the triggering business events.
• Transforms inputs of all types into outputs, according to guidance
(policies, standards, procedures, rules etc.) employing reusable
resources of all types.
• Contains activities which usually cross functions and often
organizational units.
• Has performance indicators for which measurable objectives can be
set and actual performance evaluated.
• Delivers a product or service to an external stakeholder or another
internal process.
• Usually connects to other processes.
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Process Inventory
• Fairly easy to manage HR and assets
• Process are mainly hidden and invisible
• Can’t manage the unknown
• Conduct a process census
• Develop a process inventory
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Example: Process Inventory Process
Name
Type Output Customers Frequency Performance
Indicators
Leave Admin:
Application –
Updated System
S Updated
Leave
System
Full-time
Employees
84 pm Time: 12 days
CSI: 90%
Strategic Planning:
Instruction –
Approved Plan
M Approved
Strategic
Plan
Minister, DG,
DDG’s &
CD’s
1 pa Time: 3 months
Costs: R1.2m
ID Doc: Application
– Issued ID
C ID
Document
RSA Citizens
> 16
438000 pa Time: 6 weeks
Costs: R325
CSI: 70%
Driver’s License:
Application –
Issued License
C Driver’s
License
RSA Citizens
> 18
161 pm Time: 6 weeks
Costs: R180
CSI: 75%
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(Note: Include additional headings according to requirements
Process Classification
• Core Processes
• Support Processes
• Management Processes
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Process Classification
• Core processes constitute the main business and create the primary value stream. Typical operational processes are purchasing, manufacturing, marketing, and sales.
• Management processes govern the operation of a system. Typical management processes include corporate governance and strategic management.
• Supporting processes support all other processes. Examples include accounting, recruitment, and technical support. Suitable for outsourcing.
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Sources for Process Inventory
• Structures, both organisational and functional
• Business forms
• Applications and databases
• Legislation, policies, frameworks
• Performance agreements
• Job descriptions
• Norms and standards
• Business model
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Exercise
• Develop a process inventory for the HR
function of an organisation
• Identify at least 15 processes
• Use the Business Model case study as
input document
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Process Modelling
• The activity of modelling a business process usually predicates a need to change processes or identify issues to be corrected.
• Process modelling has always been a key aspect of business process reengineering, and continuous improvement approaches seen in Six Sigma, Kaizen, LEAN, etc
• This transformation may or may not require IT involvement, although that is a common driver for the need to model a business process.
• Change management programmes are desired to put the processes into practice.
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History
• Techniques to model business process such as the flow chart, functional flow block diagram, control flow diagram, Gantt chart, PERT diagram, and IDEF have emerged since the beginning of the 20th century.
• The Gantt charts were among the first to arrive around 1899, the flow charts in the 1920s, Functional Flow Block Diagram and PERT in the 1950s, Data Flow Diagrams and IDEF in the 1970s.
• Among the modern methods are Unified Modeling Language and Business Process Modeling & Notation.
• Still, these represent just a fraction of the methodologies used over the years to document business processes.
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History
• The term "business process modeling" itself was coined
in the 1960s in the field of systems engineering by S.
Williams in his 1967 article "Business Process Modeling
Improves Administrative Control".
• His idea was that techniques for obtaining a better
understanding of physical control systems could be
used in a similar way for business processes.
• In the 1990s the term "process" became a new
productivity paradigm.
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What is Process Mapping?
• Process mapping is a technique of
diagrammatical modelling.
• The diagram represents a series of activities and
how they are related.
• Process mapping provides a representation of
who does what and in what order.
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Process Modelling
• A business process can be decomposed into several sub-processes, which have their own attributes, but also contribute to achieving the goal of the parent-process.
• The analysis of business processes typically includes the mapping of processes and sub-processes down to activity level.
• A business process model is a model of one or more business processes, and defines the ways in which operations are carried out to accomplish the intended objectives of an organisation.
• Such a model remains an abstraction and depends on the intended use of the model. It can describe the workflow or the integration between business processes. It can be constructed in multiple levels.
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Process Modelling
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Get the big picture
Drill down
Go back to the big picture
Process Models
• There are three main types of process models:
– Diagrammatical models: a static diagram that
shows the processes and the relationships between
them (eg. process maps and flowcharts.)
– Descriptive models: written explanations of the
processes
– Active models: a working model that represents the
processes (eg. computer simulations)
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Modelling Standards
• Different stakeholders need to interpret model
content in the same way.
• That’s where modelling standards come in.
• Modelling standards define process model
elements and their meaning.
• They enable efficient and collaborative BPM
across corporate boundaries and disciplines.
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Modelling Standards
BPEL Business Process Execution Language
BPMN Business Process Modelling & Notation
EPC Event-driven Process Chains
UML Unified Modelling Language
WSDL Web Services Description Language
XPDL XML Process Definition Language (XPDL
XSD XML Schema Definition (XSD)
IDEF Integrated Definition Language
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Process Modelling Tools
• BizAgi Process Modeler (http://www.bizagi.com)
• Questetra BPM Suite
• Tibco Business Studio
• Aris Express (soon to be released)
• Process Maker
• Open ModelSphere
• Visual Paradigm for UML (Community Edition)
• Archimate
• Facilis BPMN Designer
• FreeModeler (http://www.freemodeler.com)
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BPMN
• Business Process Model and Notation (BPMN) is a graphical representation for specifying business processes in a business process model.
• It was previously known as Business Process Modelling Notation.
• Business Process Management Initiative (BPMI) developed BPMN, which has been maintained by the Object Management Group since the two organizations merged in 2005. As of March 2011, the current version of BPMN is 2.0.
• www.bpmn.org
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BPMN
• The primary goal of BPMN is to provide a standard notation readily understandable by all business stakeholders.
• These include the business analysts who create and refine the processes, the technical developers responsible for implementing them, and the business managers who monitor and manage them.
• Consequently, BPMN serves as a common language, bridging the communication gap that frequently occurs between business process design and implementation.
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BPMN Elements
• BPMN models consist of simple diagrams constructed from a limited set of graphical elements. For both business users and developers, they simplify understanding business activities' flow and process.
• BPMN's four basic element categories are: – Flow objects
– Events, activities
– Gateways
– Connecting objects
• These four categories enable creation of simple business process diagrams.
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Diagram Elements
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Activities
Events
Gateways
Connectors
BPMN Event Types
• An Event is something that “happens” during the
course of a business process. These Events affect
the flow of the Process and usually have a trigger or a
result. They can start, interrupt, or end the flow
• Events are circles
• The type of boundary determines the type of Event
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BPMN Activity Types
• An activity is work that is performed within a business
process. The types of activities that are a part of a Process
Model are Sub-Process and Task
• Activities are rounded rectangles
• They can be performed once or can have internally defined
loops
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BPMN Gateway Types Gateways are modelling elements
that are used to control how
Sequence Flows interact as they
converge and diverge within a
Process
• All types of Gateways are
diamonds
• Different internal markers indicate
different types of behaviour
• All Gateways both split and
merge the flow
• If the flow does not need to be
controlled, then a Gateway is not
needed
• Thus, a diamond represents a
place where control is needed
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Different Types of BPMN
Connections
• A Sequence Flow is used to
show the order that activities will
be performed in a Process
• A Message Flow is used to show
the flow of messages between
two entities that are prepared to
send and receive them
• An Association is used to
associate data, information and
artifacts with flow objects
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Benefits of Modelling
• Align Operations with Business Strategy
• Improve Process Communication
• Increase Control and Consistency
• Improve Operational Efficiencies
• Gain Competitive Advantage
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Summary
• BPM Mandate
• Alignment between strategy and operations bmo
business modelling
• BPM includes, amongst others the identifying,
classifying and modelling of business processes
• Process inventory
• Process modelling standard e.g. BPMN
• Process modelling tool e.g. Bizagi
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