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The automatic reaction of businesses to the current economic crisis is to seek ways of cutting costs. In many cases, however, they do so blindly and without really knowing whether such measures will deliver the desired results, i.e., allow them to survive. In my view, these organizations are going about it the wrong way: the key to survival and maximizing market potential are investment and/or developing growing business areas. At first sight, the idea of spending money in times of crisis appears counter-intuitive, but making the right investment at the right time can ensure survival. To do this, you need to consider where and how the money can best be put to use – which is only possible if you know your value-adding processes inside out and have identified existing weaknesses.

But how can you gain the necessary visibility into your business? In recent years, companies have launched a range of diverse initiatives to create appropriate mechanisms for corporate management. At the management and controlling level, financial indicators were used for planning, profitability, and cost management purposes. User departments deployed modeling tools to define parameters for operational processes, which were then implemented by IT. Silo solutions for capturing and analyzing data from operational systems are also still in use today.

What has been lacking, is a way of combining these different concepts to enable effective management at the strategic, tactical, and operational level.

BPM as a driver of business success

Help is at hand! As well as facilitating transparent processes, Business Process Management (BPM) solutions deliver answers to questions about efficiency (doing things right) and effectiveness (doing the right things). Especially in the current crisis, the ability to quickly and precisely analyze a company’s business is vital. Talking to many of our customers, it’s clear to me that organizations want to:

 

  • better manage their processes
  • optimize their value-adding processes
  • improve monitoring of ineffective processes and replace them with better processes
  • tap into new business areas through new, innovative processes.

 

A recent Gartner note by Elise Olding (published 12 March 09) called “It’s a Matter of Survival: Use BPM to Drive Out Costs” highlights the importance of BPM when facing challenging conditions. In response to the question: “Are you being pressured to reduce your BPM budget or disband your BPM initiative as a result of economic pressures?”, 95% of customers said that their BPM projects had not been affected. Indeed, the majority reported that there was more management support than ever for such projects. The key is to be proactive, rather than just reacting to events. Let me use two examples to show how integrated BPM solutions, such as SAP Modeling Applications by IDS Scheer, can provide the necessary support.

BPM with SAP Modeling Applications by IDS Scheer

BPM comprises four phases: process design, implementation, execution, and monitoring. Particularly in the design and monitoring phases, it’s crucial to distinguish the business view from the technical view. But why? Although BPM involves both technical and business aspects, I would emphasize that focusing solely on the technical implementation of processes is the wrong thing to do.

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Fig.1: Business model changes at the strategy level impact on the BPM and process execution levels

 

It’s the business view that should be given prominence. What sense is there in modeling and implementing a process that, although technically faultless, is not used anywhere in the enterprise or cannot be properly adopted by employees? None. This is still a major issue with SAP implementations. SAP Enterprise Modeling Applications by IDS Scheer takes a process-oriented approach to SAP implementation. Based on years of working closely with SAP, we have developed reference processes in SAP Enterprise Modeling Applications by IDS Scheer that cover all an organization’s core processes, plus the supply chain. Businesses can leverage this huge store of process knowledge to define their core processes using process maps. Synchronization with SAP Solution Manager enables creation of exactly the right business process environment in the SAP system. The result: workflows without any redundancy.

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Fig.2: Align business requirements with the functionalities of your SAP system via synchronization of SAP Enterprise Modeling Applications by IDS Scheer with SAP Solution Manager

 

If you want to get the big picture on how BPM tools from IDS Scheer and SAP can be combined for an optimized BPM approach, please watch the following podcast interview with Thomas Volmering, one of SAP’s experts in this field:

Interview with Thomas Volmering

In the following interview with Ann Rosenberg, BC Global Practice Owner for Business Process Management, Senior Strategic Business Process Management Consultant at SAP, and author of the book “Roadmap to Business Process Management”, you can learn how to develop a BPM roadmap and integrate BPM with SAP’s Enterprise SOA approach:

Interview with Ann Rosenberg

Business Process Management becomes Process Intelligence Management

The business view is also key to success when it comes to process monitoring. Although monitoring technical process performance provides a basic platform, precise knowledge of how to optimally use all critical processes in the overall context of the organization, i.e., for business performance, is essential to corporate success.

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Fig.3: Comprehensive business performance with various aspects at the strategic, tactical, and operational level

 

Merely collecting financial KPIs on a data-driven basis without linking them to processes doesn’t actually boost efficiency or customer satisfaction, though. Past financial data or KPIs likewise offer little insight into the cause or resolution of impending problems. Process-oriented performance management tools are required that enable day-to-day business management at the strategic, tactical, and operational level. Combining Business Process Management and traditional Business Intelligence technologies creates a new generation of tools that allow performance analysis and optimization directly in operational processes.

These tools closely link the analytical functionalities of traditional BI concepts with business process monitoring. This means that analytical components are integrated into process execution to control it as efficiently as possible – partly without human intervention – and support decision-making. In addition, analysis techniques are used to measure and analyze process performance.

One point shouldn’t be overlooked here, and that is acceptance of such new tools by non-expert users. Process intelligence systems need to have simple configuration and integration technology (e.g., through mashups) and thus allow smooth integration into the individual work environment.

These two examples reveal the playback qualities of comprehensive BPM solutions, such as SAP Enterprise Modeling Applications by IDS Scheer, and demonstrate that organizations of every shape and size are really excited by the potential of BPM.

 

To sum up, BPM offers the following key benefits: 

 

  1. BPM gives companies a clear view of the entire organization. They can use BPM to proactively manage business process effectiveness and efficiency. BPM leads to measurable business results.
  2. BPM facilitates cooperation between management, business, and IT.
  3. BPM helps to ensure corporate compliance and governance. By using BPM, organizations can define a streamlined process that provides the necessary audit tracks.
  4. Support for employees: By simplifying admin tasks for employees, BPM can boost motivation – more time can be devoted to tasks that add real value.

 

For more information on Business Process Management solutions please have a look at:

SAP Enterprise Modeling Applications by IDS Scheer 

Process Intelligence White Paper

Overview of SAP Enterprise Modeling Applications by IDS Scheer

 

I hope you like this blog. Please let me know if you have any comments or ideas you’d like to discuss regarding Business Process Management.

If you’d like more information about the latest BPM trends, you can also read our ARIS BPM blog at http://www.arisblog.com/.

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6 Comments

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  1. Norman Marks
    Can you comment on whether and how process redsign using BPM can be enhanced through the consideration of risks, insertion of process metrics such as with Six Sigma, and the use of tools like Spend Analytics?
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    1. Wolfram Jost Post author
      Of course you can enhance BPM with risk as well as with process metrics. It depends mainly on the objective of your BPM initiative. The meta model of ARIS for example can manage risk elements and process metris. Risk and control elements are helpful when your objective contains governance, risk and compliance issues. Process metrics are relevant for process performance measurement aktivities which are part of the six sigma lifecycle. I do not know the tool Spend Analytics.
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  2. Christiane Nicolay
    Hi all,
    today, 4-5 p.m. (CEST) you can chat live with Dr. Wolfram Jost on his blog and discuss further interesting topics around BPM.
    Do not miss the chance and feel free to comment!
    Best, Christiane
    (0) 
  3. Dinesh Ghanta
    Hi,

    I wanted to make a suggestion that it would be great if IDS Scheer can start publishing Best pratice methodologies on how to implementing and execute BPM projects. Since IDS Scheer has been doing a  lot of BPM work since so many years it will be great if you can publish the experiences in teh form of Best Practices. I agree that there are lot of articles which are being published by IDS Scheer but the most important and core information like what must be the BPM Project structure, what must be the governance and change management around the Process Modeling, how to execute a Process Performance Management project and how can simulation help business to improve their processes. It will be good if IDS SCheer can  publish flash demos of working systems so that Customes can get interested in them. All the info and demos you make available in the Process World can be made available in your IDS SCheer web site itself. This can create a lot of awareness and trust and can help you to build you customer base. And also I must say that it is very sad that all the knowledge communicated and exchanged in the IDS Scheer events gets evaporated once the event is over. There are lot of things like this which I wanted to bring to you notice and belive that these things will be addressed in the near future

    Thanks

    Dinesh

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    1. Wolfram Jost Post author
      Hi Dinesh

      Thanks for your comment and sorry for the delayed answer. As you perhaps know, we had several events like ProcessWord on Tour in the European region (already done in Munich and Prague) or Process Intelligence roadshow stops in the Nordic region.

      You wrote:
      I wanted to make a suggestion that it would be great if IDS Scheer can start publishing Best pratice methodologies on how to implementing and execute BPM projects. Since IDS Scheer has been doing a lot of BPM work since so many years it will be great if you can publish the experiences in teh form of Best Practices.

      We’ve developed already best practice methodologies and published it with our ARIS Value Engineering approach. Most of these methodologies are public but not all parts of the AVE approach are offered for public – it is one of our core expertises that differentiate us to other BPM companies.
      Additionally, you certainly will understand, that we cannot publish best practices from customer projects. This is very sensitive information and our customers do rely on us. We don’t want to lose their confidence.
      Nevertheless, we are publishing project information via references, customer statements, etc. We recognized in the past that there is a need for use case demonstrations in ARIS. That’s why we’ve developed our UMG demo database. This database is part of every ARIS installation and shows you all the use cases we cover with ARIS in a company’s organization. In some of our ARIS Expert Papers, we show you project procedures, too. Please have a look at our expert paper library: http://www.ids-scheer.com/en/ARIS/ARIS_Software/ARIS_Expert_Paper_Library/5527.html

      To get a deeper knowledge in best practices and to have the possibility to share your ARIS knowledge with other ARIS users, we have regularly ARIS User Group meetings in the countries. Additionally, we founded in May 09 ARIS Community on http://www.ariscommunity.com. Via this online platform, you can get in touch with other ARIS users worldwide, you can place your questions, discuss best practices, read our ARIS BPM blog, etc.

      You wrote:
      And also I must say that it is very sad that all the knowledge communicated and exchanged in the IDS Scheer events gets evaporated once the event is over.

      To avoid exactly this, we try to save the communicated knowledge through offerings like:

      1)As participant on our roadshows, on ARIS User Group meetings or other IDS Scheer events, you have access to all the customer and IDS Scheer presentations

      2)We made several ARIS TV episodes on different topics (like interviews with customers, various BPM topics and customer projects). Please have a look on ARIS TV on YouTube: http://www.youtube.com/aristv


      I hope that this will help you. Nevertheless, we are aware that there is always potential for optimization. We are working on it!

      Best
      Wolfram Jost

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      1. Dinesh Ghanta
        Hi Wolfram Jost,
        Thanks a lot for the reply. I agree with you. I’m very happy about the initiatives like ARIS Community, ARIS Express and ARIS Online Academy and the various web castes. I’m happy that there is a great momentum which is building up finally in the BPM area. I’m sure that because of the work you and SAP are doing 2010 will be a great year with lot of change happening in the way Projects are implemented. I think more and more organizations will become process oriented which will result in organizations become more successful.
        I’m sure that more and more customers will realize how important BPM is to the changes happening in the way business is done and how important it is to enable SOA in organizations. I hope every goes as expected and we will have great coming ahead.

        Thanks
        Dinesh Ghanta

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