The term "business process" is used herein to refer to any set of activities performed by a business, such as the activities involved in manufacturing or service provision.
"Business process management" is a way to organize and manage the activities of an organization. It provides a framework for organizing, managing, and executing business processes within an enterprise.
The goal of BPM is to improve the quality of services provided by an organization through improved communication between people and systems, better decision making, reduced waste, and increased efficiency. The benefits are realized primarily in two ways: first, by providing visibility into how work gets done; second, by automating tasks that can be automated. In other words, BPM provides a way for organizations to make decisions about what they do based on data rather than just intuition or experience.
Examples of business processes:
- Mortgage approval
- Student enrollment
- Business trip expanse reporting
- Receiving inspection etc.
Why to use Business Process Management (BPM)?
There are many reasons why businesses should use BPM. Here are some examples:
Reduce costs: By automating repetitive manual processes, companies can reduce labour costs while increasing productivity. For example, suppose you have a customer who sends out invoices every month. In that case, you could automate this process so that employees only need to enter basic information into your accounting system once. The rest of the time, the system automatically handles all of the processing.
Improve Quality: When you automate processes, you eliminate human error. If you have a complex process with multiple steps, chances are there will be errors along the way. Automation makes these mistakes much less likely to happen because the software has already been tested and debugged.
Improve Productivity: Another advantage of using BPM is that it helps increase employee productivity. Employees don't have to spend their days searching through manuals or training materials to figure out how to perform certain functions. They can follow a step-by-step guide that tells them exactly what to do next. This frees up more of their time for higher-level thinking and problem-solving.
Improve Customer Service: It's not always possible to completely automate customer service interactions, but it's often possible to provide customers with helpful information at the point of interaction. For example, when a customer calls your company's help desk, you can create a standard script that gives your staff consistent responses to common questions.
Improve Communication: Finally, BPM allows you to communicate clearly with your team members and customers. You can write down a standardized procedure for each department and share it with everyone. Then, whenever someone needs to know how to accomplish something, they can look up the procedure in a database and find out exactly what to do.
Five Steps in BPM
To improve an old system, first, analyze the current process to know where things need improvement. Next, plan for the ideal business processes by following best practices.
- This could be an existing process needing improvement or a new process.
- Visual flowcharts are created for, as-is process and the proposed improved method.
The visual workflow model must support the desired objectives.
The second phase of BPM is modelling. To model a process, you must identify the key activities involved in performing the task and determine how they relate to one another.
Create a model of the business processes to see how the process works under different scenarios.
- Analyze the process by running "what-if" scenarios on the proposed method.
- What if the supplier rejection rate is 5%.
- What if the supplier is unable to supply parts.
Once you've modelled the process, you can begin executing it. The process could consist of manual and automated activities. At this stage, you'd ideally test the process by running it through a series of scenarios. These scenarios would include different variations on the same activity.
Finally, you need to monitor the results of the execution. If you see discrepancies between the expected and actual output, you should adjust the process accordingly.
Monitor the progress of the process based on established matrices such as Service Level Agreement, Defect Rate, cycle time, efficiency etc.
You can also use BPM to optimize processes after they've already been implemented. In this process, you find out actual or potential bottlenecks or constraints. That will lead you to further improvement opportunities. Repeat the cycle by going to the first step that is Design.
When you do so, you should be careful to avoid making changes that could cause unexpected consequences.
In conclusion, using Business Process Management helps companies achieve their goals faster, better, cheaper and more efficiently. It provides a systematic approach to achieving these benefits.