Business Process Management (BPM) is the topmost critical success factor for any organization. Standardize Business Process always the top priority for any organization to achieve the long term vision of the organization. In this article, We will try to understand what is Business Process Management (BPM), Why Business Process Management required in any organization, and what are the top benefits after the successful implementation of Standardized Business Processes. Value Streams mapping is an important part of Business Processes.
Definition of Business Process Management?
Business Process Management (BPM) is a management discipline that focused on improving corporate performance by managing a company’s business processes. BPM is a holistic management approach that aims to align business processes with changing business needs by continuously focusing on optimizing them.
Business Process Management (BPM) | Blog Series
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- Definition of Business Process Management?
- Requirements for Business Process Management (BPM)
- Top Benefits of Business Process Management (BPM)
- 1. BPM saves an organization’s Time and Money
- 2. Improved Business Agility
- 3. Enhanced Business Intelligence
- 4. Improved Operational Accountability
- 5. Continuous Improvements
- 6. Good Compliance and Regulatory Governance
- 7. Effective Measurement
- 8. Effective Risk Management
- 9. Effective Operational Management
- 10. Performance Visibility
- The Disadvantages or Pitfalls of Business Process Management (BPM)
Each business activity has a specific set of processes to support its execution. When you undertake a particular task, you knowingly or unknowingly follow a process. These processes usually involve interaction between work, people, and technology.
Therefore, as an employee, it’s very important to understand the principle and execution techniques that help define processes. Doing so opens up the ability to improve effectiveness, efficiency, and productivity for the organizations.
Requirements for Business Process Management (BPM)
Before we begin to dive deeper into the discipline of BPM, it’s first important to discuss why its adoption is so important for an organization. This is perhaps the most fundamental problem that confronts the BPM community today.
Many process analysts still struggle to convince others of the merits of using such a discipline. In complex business environments, BPM offers a standard and scalable solution for managing processes. These solutions include person-to-person work steps, system-to-system communications, or combinations of both.
It integrates various independent disciplines of process modeling, process simulation, workflow, process execution, process monitoring, Enterprise Architecture, Lean, and Six Sigma into one unified standard to manage change.
BPM provides organizations with the most comprehensive ability to document, assess, and improve the enterprise.
- Function Analysis is used to assess the functions performed by an organization at the macro level. This identifies growth opportunities and provides guidance for strategic planning.
- Service analysis is used to identify manual processes for automation and helps prepare them for integration with IT platforms.
- Process analysis is an assessment of end-to-end processes that aids process analysts to identify process improvements and optimize business performance.
- Information analysis is used to define and assess the flow of information between various stakeholders, identify any gaps, and optimize those channels.
- Workflow analysis is used to define and assess data workflow between applications, networks, and systems.
Top Benefits of Business Process Management (BPM)
1. BPM saves an organization’s Time and Money
BPM helps to identify redundant processes and eliminate duplication of work tasks. By standardizing business processes, organizations are able to reduce their operating costs by executing a repeatable process. This achieves the same result every single time.
The processes are standardized to become stronger candidates for automation. This helps reduce the work turnover cycle by reducing waste, enhancing efficiency, and ultimately boost profitability.
2. Improved Business Agility
BPM enhances an organization’s ability to sense potential opportunities or threats and help prioritize its response strategy. By adopting BPM, organizations have the ability to sustain volatile economic conditions by adding or removing services.
That you can differentiate between “desirable” and “essential”. It also allows organizations to go to market with new products more quickly. Improved business agility provides visibility, control, and flexibility to respond better to customer’s needs and expectations.
3. Enhanced Business Intelligence
With effective recording and monitoring of business processes, BPM offers the ability to track and locate essential information and produce reports for senior management. It provides insight into the performance of those processes.
BPM facilitates the dissemination of information in a timely manner, thus improving the reliability of the information necessary to make judicious time-sensitive decisions.
4. Improved Operational Accountability
BPM provides high accountability to all departments within an organization by providing the ability to track and monitor budgets and deliverables. Documentation of business process activity helps organizations to achieve a system of checks and balances, thereby minimizing the potential for fraud, errors, or loss.
5. Continuous Improvements
BPM creates an environment for continuous process improvement in an organization and facilitates its ability to implement those improvements. It also helps to automate processes through technology that almost always results in significant cost savings.
Automation reduces manual work, decreases lead times, and increases straight-through-processing rates. In this context, it’s important for you to note down that successful organizations with a BPM capability are usually seen to gradually phase out disparate legacy systems.
6. Good Compliance and Regulatory Governance
In today’s business environment there is a wide array of government rules and regulations which organizations need to follow. Successful BPM implementation strives to achieve effective, coherent controls in place and at every process level.
It involves tools, procedures, policies, and business metrics across the company so there is always “one version of the truth.”
This helps the organization keep track of their obligations, and ensure they are compliant with applicable standards. When you will have clearly defined processes, BPM will provide you the ability to avoid potentially costly repercussions of non-compliance.
7. Effective Measurement
A computer science engineer Tom De Marco once said “you can’t control what you can’t measure”. BPM strives to quantify the outcomes of operational activities—cost, throughput, cycle time, quality, customer satisfaction, or any other output. You can use these measurement tools such as Lean and Six Sigma.
Effective measurement closes the feedback loop in the process management cycle and provides managers with crucial information they can leverage to make further improvements.
8. Effective Risk Management
Good Risk Management is an integral component of any process. In BPM, documented processes are reviewed and assessed by process analysts from a risk perspective whereby, effective controls are embedded in all processes and for all levels of staff.
Process analysts are able to greatly reduce the overall risk to an organization by enforcing rigorous process management in all business units.
9. Effective Operational Management
Organizations that have successfully implemented BPM usually witness operational efficiency through shorter cycle times, lower costs, and the ability to handle additional work with no linear increase in staff. This results from process improvement and prevents lapses with former unproductive methods or practices.
By having an effective process management system in place, business leaders can maintain a comprehensive understanding of their own processes, measure them effectively, and make sound decisions on how to move their businesses forward.
10. Performance Visibility
BPM enhances the end-to-end visibility of a process that makes its performance transparent to those staff members who are responsible for it. By monitoring the performance of a process, a staff member can react accordingly and remediate any waste or problems in a much quicker fashion.
BPM provides the means to conduct performance measurement across an organization and can display the results in management dashboards. Process analysts can investigate further to isolate the root causes of bottlenecks such as time delays and high processing costs.
The Disadvantages or Pitfalls of Business Process Management (BPM)
Successful Implementation of Business Processes has big benefits to the organizations. But sometimes due to lack of evidence, we are not able to show the benefits to the organization and seem the disadvantage.
But there are some pitfalls also we have experienced. We have discussed on Top 10 Pitfalls to avoid in Implementing BPM
Over the last forty years, BPM has essentially become the umbrella term to describe all the continuous improvement approaches to process management.
TQM, Workflow Management, Lean, and Six Sigma are now viewed as specializations of the larger BPM discipline. While these approaches focus on the specific aspects of process-centered management, BPM has also been recognized as the consolidation of these concepts through the use of sophisticated Automation Technologies. Many BPM solutions & software are available to help to automate Business Processes.
However, the implementation at all levels of an organization by each employee is the real beauty of BPM. Now that you’ve received a high-level introduction to BPM and its evolution, it’s now time to get right into the details in the coming articles. Follow to understand about Business Process Maturity Model (BPMM).