Business Process Management (BPM)

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Management > Business Process Management

Abstract

Business process management (BPM) is a method by which a business undergoes inspection of the entire operation of its network to evaluate processes, termed workflow, and to make specific recommendations for improved efficiency and productivity as a way to optimize operations. Using the information storage capacity of software to understand how a business produces a good or service, BPM is a business template for grasping the big picture of a network operation.

Overview

To appreciate the sweeping management vision of BPM, one need only consider how such business reviews were routinely conducted less than a generation ago. Traditional evaluations of productivity would approach the business as if it were a collection of essentially disconnected processes. Under that rubric, a team of internal management efficiency experts, most often supervisors positioned because of seniority within the higher-echelon management, would evaluate the different elements of the operational processes. In short, the tasks performed by each department would be evaluated independently in an effort to locate areas of inefficiency, wasted resources, unacceptable risks to worker safety, miscommunication, or redundant functions. Each phase of the business operation--from hiring workers to promoting executives, from paying workers to terminating workers, from securing whatever raw materials might be necessary to the actual manufacturing of the product on-site, from designing the packaging of the product to maintaining its shipping lines, from marketing the product in the media to promoting new product development--would be treated as individual, self-directing phases of operation. The theory behind such internal evaluation, termed segmented responsibility, was that if a business made each step tighter, the entire process would improve.

The problems with segmented responsibility are obvious. The process itself was conducted entirely in-house, relying on the workforce responsible for operations to look critically at their own performance. The process was time-consuming--businesses seldom were able to evaluate individual departments more than once a fiscal year. The emphasis was almost always negative: slashing costs, eliminating redundant employees, getting more work out of staff, optimizing the use of equipment, compelling the workforce to increase productivity without appropriate support systems. Work harder. Work leaner. Work quicker. No stage of the evaluation process considered the business from end-to-end. The business was simply considered the sum of its parts. This lack of process integration is illustrated by a metaphor that dominates BPM templates: A person unable to make a fist goes to a doctor who considers the fingers without taking into account the hand, the arm, and the body's entire muscular system, which must work together to make a fist even possible.

The concept of approaching a business as an organic whole dates back more than two centuries (van der Aalst, 2013). Integrative system management, however, became a cutting edge approach to reevaluating how a business actually does its business with the advent of automated business information systems in the early 1990s. In effect, the process of production itself became an asset, something to be valued and constantly reviewed for enhancement of its efficiency and efficacy. The traditional segmented hierarchical approach quickly became antiquated as businesses began to re-assess their operations as an entity, each part inextricably bound to the other parts, each stage integrated to what comes before and what comes after. For example, the efficacy of hiring processes can be examined in light of how retailers selling the business's product respond to the product.

Business process management "exists at the very boundary between business and information systems" (Snoeck & Lemahieu, 2005). The burgeoning field of information technology and the sudden availability of a wide range of powerful software tools provided suitable platforms for gathering information about business operations. Because automation has made possible the retrieval and storage of information on a large scale and at a granular level, businesses no longer have to rely on annual evaluations. Companies are able use this vast data to evaluate their operations nearly continuously.

If the goal of traditional segmented responsibility was simply to slash operations, streamline departments, and cut staffing, the goal of contemporary BPM is far more synergistic and creative--and, in turn, evaluation of a business creates far less anxiety in the staff. The goal of BPM is communication, a "representation of the complete process to support communication about that process." (Palmer, 2013) By providing company operations management with specific information about operation design inefficiencies, BPM looks to bring the operation teams together, to make the employee/supervisor relationship dynamic, collaborative, and efficient. The feedback on operations management occurs in real time, with information secured and made available instantaneously, keeping productivity on track and efficient. Company operations are able to react with greater agility, enacting operations changes more easily and more often. Indeed, given the reach and range of BPM software and the virtually limitless storage capacity of BPM platforms, companies can stay self-governing, self-regulating, and self-correcting simultaneously to the actual processes of the network itself.

Because the evaluation of the company processes actually begins with the retailers, the clients, and/ or the customers, the process offers a practical immediate value that traditional process management surveys lacked. Companies hear from their customers/ clients about the efficiency of their operations, the cost of their product/service, the effectiveness of their product/service, and the ability of the process to adapt to particular customer/client needs. That critical information, provided often as specific network projects are still in process, helps a business adapt--like a football coach watching game film during the actual game. "The concept of continuous improvement is at the heart of the business process management value proposition." (Rudden, 2007) By combining those people actually engaged in the product (or service) with those who receive those products/services, cutting edge technology can optimize operations, thus keeping customers satisfied while at the same time creating new possibilities for adjusting operations. The customers/retailers feel part of the production process; the staff is happier, more efficient, more motivated, less anxious; and company executives are more in tune with day-to-day operations and able to track actual productivity more accurately and in a far more timely fashion. Each is a targeted goal of BPM.

Applications

The contemporary protocol of business process management begins not with internal evaluation but rather with a team of outside professionals who agree to work long term with a company, to review and monitor a business's total process model over time, to become, in effect, a part of the operations but still maintaining a critical distance. Under BPM, an outside review process becomes a fixture in the network. BPM experts not only set up appropriate software to monitor processes but also become part of the ongoing operations of the network in an effort to rehabilitate operations management from workers' perception of it as something hostile into an important part of the team effort. Since the mid-2000s, the creation of firms across the country that specialize in BPM reviews have rapidly multiplied, their services advertised in hundreds of websites that appeal to younger entrepreneurs and business owners savvy with cutting edge technology.

BPM involves the total evaluation of a company's infrastructure. It is often mistaken for introducing automation and computer software into an existing network as a way to speed up productivity or to create more efficient record keeping. Such software exists, of course, and introducing the most up-to-date computer software can of course be part of any business operation review. BPM operatives, however, introduce software applications into networks that can, for example, simulate the business operations and check for problem areas without actually moving into real-time operations. Other software apps can measure supervisor control and communication avenues by testing messaging or provide massive libraries of customer/client feedback, worker/ supervisor evaluations, and even former employees' responses to company operations. Such a cluster of specially designed software programs are termed a business's application suite.

BPM is not limited to the improvement of a single element or stage of a business's operations, even if that improvement does in the end positively impact productivity, for example, a supervisor providing coffee to the night shift. Such specificity is termed business process improvement. Neither does BPM focus on a single department improving its operations, for example, the introduction of an office software app on the recommendation of a bookkeeper. One of the reasons why BPM involves outside evaluators is exactly this tendency within businesses with a vast infrastructure of operations: Individual departments tend to manage only their own processes.

BPM assumes that any business is essentially a team effort, that the business operations flow in stages that are linked one to the next, that the breadth of the operation process is holistic and inclusive and that any improvements must help integrate these stages into a single organic movement. BPM, then, is not something a company decides to do or a computer software package it decides to purchase or a periodic review of its operations. Rather it redefines a business not as a series of functions but as a single function that must be treated as ever-evolving single operation. "Business process management involves managing end-to-end work that organizations perform to create value for their customers" (Rock, 2014).

BPM introduced the radical premise of measuring the effectiveness of business operations by the outcome of its operation. Begin at the end. Consult with those outside the network most involved with actually using the product or service. If a business operation is, in fact, a single organic process, BPM seeks to establish reliable and related links--after all, whatever the goods or services produced by a network, that production is essentially and fundamentally about moving, storing, and sharing needed information most effectively and efficiently. Each link, in turn, maintains a clear and transparent responsibility and, more important, a clear and necessary tie to what has come before and what will come after in the process. In turn, the process can be standardized with the data storage capability of process software. Further, a business can, in real time and in response to changing conditions, improve operations, close risks, minimize inefficiency, and maintain currency with relevant government regulations or industry standards. The business can not merely change but adapt, evolve, and grow.

Overhauling business operations is time-consuming and can alienate clients and customers alike, and introduce the risk of losing valuable data during the process of conversion. Rather than overhaul operations, BPM seeks to improve it as it exists. This is a far less traumatic move within a network and can be far less intimidating and alienating to workers and supervisors. Business operations then are reconceived as cyclic, not linear--that is, an operation constantly fed up-to-the-minute data on efficiency, productivity, responsiveness, and communication.

Viewpoints

"Too often, business process management became about drawing lines with fancy visual tools that…focused only on automation." (Woods, 2008) Such limited improvement does not rise to the scope or reach of BPM. Introducing automation and even cutting edge computer technology into a business process that is itself clogged with redundant steps, bogged down in fuzzy lines of communication, marred by an unclear chain of command, prone to waste, or given to human error would be akin to paving a cowpath, another favorite metaphor of BPM think tanks. In other words, it simply makes quicker an inefficient and costly process.

The technology of BPM is rapidly evolving, and the long-term impact of this kind of total re-conception of a network operation model has yet to be studied. Nevertheless, the idea behind BPM created genuine buzz within the corporate world. Its bold all-encompassing template for a business, termed service oriented architecture (because it perceives the reception and distribution of a business's goods or services as the starting point for constructing a total comprehensive network model), has moved businesses from reacting to inevitable fluctuations in economic conditions or reacting to hard data of a business's poor production to a far more proactive position. BPM promises businesses a shift from permanent crisis management to daily monitoring and analysis of operations, engaging feedback from outside consultants, and combining the muscle of technology with the talent and skills of their workforce to create a smooth, entirely transparent institutional workflow.

Long-term implications of the business template have suggested that BPM can actually help drive growth (Huoy, Fettke & Loos, 2010)--not merely improving operations but by testing new markets, creating new endeavors or services, and expanding opportunities beyond measuring current operations. By creating software finely tuned to larger economic currents, businesses can actually use BPM to make critical operational decisions about expansion and appropriate risk analysis.(Suriadi et al., 2014) By bringing together a company's local concerns (concerns over its operations) and its global concerns (concerns over its market reception), by bringing together the human factor of a business with its technological environment, BPM has introduced a radical perception of a business that is at once practical and usable.

Terms & Concepts

Application suite: A bundle of computer software applications and programs tailored for a particular business, enterprise, or project.

Business process improvement: The network system of evaluation that focuses on a single project or a one-time only process as a way to suggest specific areas for improved efficiency and productivity.

Holistic: Characterized by a cooperative evaluation; that is, any single element, part, or manifestation of a larger whole cannot be evaluated, reviewed, or understood without using the rest of the model to explicate its function, efficiency, and/or productivity.

Integrated system management: The process through which a network seeks to align a variety of stages, phases, or processes into a conceptual single management model.

Segmented responsibility: The network evaluation template in which a network reviews individual parts, stages, or processes within its operation for efficiency, competency, and productivity.

Service orientation architecture: A complex of computer software applications in which a business reorients its digital template to engage all phases, systems, steps, and departments into a single grand unified field.

Synergy: The interaction, cooperation, and connections between and among differing elements, stages, or processes within a single network or field.

Workflow: Within a network, the series of multiple stages, phases, or processes often performed by different segments or departments in that network that accomplish sequentially a single goal, product, or service.

Bibliography

Houy, C., Fettke, P., & Loos, P. (2010). Empirical research in business process management--Analysis of an emerging field of research. Business Process Management Journal 16: 619-661. Retrieved December 25, 2014 from EBSCO Online Database Business Source Complete. http://search.ebscohost.com/login.aspx?direct=true&db= bth&AN=70877095&site=ehost-live

Palmer, N. (2013). What is business process management? Retrieved December 25, 2014 from http://bpm.com/ what-is-bpm

Rock, G. (2014). What is BPM anyway? Retrieved December 25 2014 from http://www.bpminstitute.org/resources/ articles/what-bpm-anyway-business-process-management-explained

Rudden, J. (2007). Making the case for business process management: A benefits checklist. Retrieved December 25, 2014 from http://www.bptrends.com/publicationfiles/ 01-07-ART-MakingtheCaseforBPM-BenefitsChecklistRudden.pdf

Snoeck, M., & Lemahieu, W. (2005). Business process management: A bird's-eye view and research agenda. Retrieved December 25, 2014 from https://ideas.repec. org/a/ete/revbec/20050412.html

Suriadi, S., Weiß, B., Winkelmann, A., ter Hofstede, A. M., Adams, M., Conforti, R., &…(2014). Current research in risk-aware business process management: Overview, comparison, and gap analysis. Communications of the Association for Information Systems 34, 933-984. Retrieved December 25, 2014 from EBSCO Online Database Business Source Complete. http://search.ebscohost. com/login.aspx?direct=true&db=bth&AN=94902914 &site=ehost-live

Van der Aalst, W. (2013). Business process management: A comprehensive survey. ISRN Software Engineering. Retrieved December 25, 2014 from http://www.hindawi.com/journals/isrn/2013/507984/

Woods, D. (2008). The ABCs of BPM. Forbes. (2008, September 30). Retrieved December 25, 2014 from http:// www.forbes.com/2008/09/29/ cio-bpm-soa-tech-cio-cx%5Fdw%5F0930bpm.html

Suggested Reading

Astanin, S., & Zhukovskaya, N. (2014). Business processes control via modeling by fuzzy situational networks. Automation & Remote Control, 75, 570-579. Retrieved March 22, 2015 from EBSCO Online Database Business Source Complete. http://search.ebscohost.com/login.aspx? direct=true&db=a9h&AN=94800307&site=ehost-live

Bala, H., & Venkatesh, V. (2013). Changes in employees' job characteristics during an enterprise system implementation: A latent growth modeling perspective. MIS Quarterly, 37, 1113-A7. Retrieved March 22, 2015 from EBSCO Online Database Business Source Complete. http://search.ebscohost.com/login.aspx?direct=true&db= bth&AN=91905981&site=ehost-live

Fumas, M., LaRosa, M., & Medling, J. (2013). Fundamentals of business process management. New York, NY: Springer.

Jeston, John, & Nelis, J. (2013). Business process management. New York, NY: Routledge.