What is BPM? Business Process Management made simple
What is BPM? When we think about Business Process Management (BPM), we often think of ‘expensive’ or ‘for large companies’. Maybe you can also think that ‘it takes up too much management time’ or ‘we are not ready for that yet’. Is that really what lies behind BPM?
All those perceptions are wrong. In fact, a Small or Medium Enterprise should worry the most about its business processes in order to grow faster. No organization should postpone this issue until it’s too late because the solution might not be as simple.
Companies that want to have a chance in the market should start by managing its business processes. Certainly, maximizing customer satisfaction and internal efficiency are crucial to grow.
Now we will present the BPM discipline in a simple and business-oriented language. Hence, we will list typical problems and worries, showing why this is such an urgent issue. The sooner you start applying BPM solutions, the better your company will operate.
What is BPM?
Business Process Management is a discipline (methodologies + technologies) to improve business processes that sustain your operations. This is done in four stages, which are the pillars of BPM:
- Model your processes using a diagram to visualize how they work. Usually the notation used is the worldwide standard BPMN (Business Process Management Notation).
- Automate processes using a BPM Suite. There are on-premise and cloud BPM Suites (like Flokzu)
- Measure time and quantity of work done using Key Performance Indicators (KPI’s), to draw objective conclusions about where and what to improve.
- Introduce improvements and repeat stage one.
What is a business process?
A business process is a sequence of activities that take place in your company to achieve any of its objectives. Usually a business process involves several people who contribute with a particular task. So, to answer “What is BPM?”, first of all we need to understand what a business process is.
Let’s analyze a real-life example. First of all your company receives a quotation request via email, telephone, website or call center. Similarly, your salesmen could receive requests. In any case, after receiving the request, it is assigned to the sales team. A salesman communicates with customers to understand their needs and build a quotation for them. There are standard proposals, which go directly to the customer via mail. And there are complex proposals that require additional approval of commercial managers. Let’s say that the client can only do three things: buy, reject the proposal or ask for modifications. Finally, if they buy, the process continues through the seller to coordinate delivery.
Stage 1 – Modeling a business process
The previous example could be illustrated with a diagram (or workflow):
Hooray! We have the first version of a workflow for our selling process. Using a diagram helps us to:
- Understand how our process is working and raises questions: Do we want this logic to complete a sale? Or a different one?
- Identify bottlenecks: The Commercial Manager is able to review everything in time to send to the customer?
Stage 2 – Process automation
Ok, the diagram is ready, now what? Automate a process using a BPMS (BPM System/Suite). That means ‘translating’ the process into a computer system that allows us to automate each process stage.
In our example, once the vendor completes a complex proposal, it goes to Commercial Manager’s Inbox. As a result, you avoid sending physical documents or exchanging mails. The BPM Suite “knows” that if it was marked as complex, it requires Manager’s approval.
The most important concept here is the ‘Inbox’. Users will find the tasks that have been assigned to them in their Inbox. Once the user completes the task, it will go to the ‘Inbox’ of the next user
In our example, the proposal will reach the ‘Inbox’ of the Commercial Manager. Hence, he will have two buttons: ‘Approve’ or ‘Return’. If he hits “Return” the BPMS will send it back to the ‘Inbox’ of the person who wrote it. If he hits “Approve”, the BPMS will send the proposal to the client (via email, for example).
In addition to managing ‘inboxes’, the process automation allows us to:
- Create new instances of processes in different ways. In our example, create new quotation request, regardless of their origin (call center, salesman, etc.).
- For each of these instances, facilitate collaboration and show at which stage is each instance.
- Set deadlines for each stage. In our example, we could make sure that the client gets our quote before a certain time limit.
Most noteworthy, you are storing all instances of the process in the BPM Suite (in the example, the commercial proposals). As a result, you are recording the full process instance history (who wrote it, when it was approved, etc.). And you have centralized all related documentation (different versions of the proposal, comments, observations, etc.). Thus, in a single system we have all relevant information of all commercial proposals. Forget about having it scattered in countless mails or Excel ® spreadsheets.
Integrating your processes with other systems is a key part to properly answer “What is BPM?”. The most common instruments to do it are Web Services (REST or SOAP) and IFTTT tools (“If This Then That, like Zapier ). As a result you can pull and push data to other systems as part of your process. Furthermore, you can launch other processes, start remote programs, or let external systems invoke your processes.
Stage 3 – Process analysis
After having automated a process with a BPMS, you need to identify your Key Performance Indicators (KPI):
- How many proposals are at each stage. How many opportunities at each stage?
- Set alerts with deadlines in each stage. How much does the client have to wait for a quote?
- Exactly how much work is each person responsible for. Are we really swamped in work or just a few stages are stuck and impact on the entire process?
Measuring tools in a BPM Suite allows us to objectively analyze how your process are running, for example:
- How many applications I quote the last month?
- For which product?
- How many ended in a closed sale? for which seller?
- How long did the whole process and each stage take?
- Is the Commercial Manager a bottleneck?
- How long does the Commercial Manager take to review each proposal?
- How many proposals are pending review?
This is “measuring and analyzing” the processes and it is a key step to answer “What is BPM?”. This way you can know for sure how well each process is working and where are the problems. As a result, you know where to use better your resources, time and money.
Stage 4 – Improve and restart the cycle
As important as detecting improvement opportunities, is to implement them quickly. Cloud based BPM Suites like Flokzu provides the greatest agility. They allow you to introduce changes in process definitions and deploy a new process in minutes.
If you need to develop custom software and make complex configurations, you loose your ability to respond quickly.
Finally, when you think about “What is BPM?” you also need to think about agility. Certainly, you need to know how long it will take to deploy a new process version.
When a company begins, each process is quite simple. But for mature companies, or growing companies the question is, can you handle everything manually? Are you affecting customer satisfaction? Are you able to scale up ?
The answer is obvious: You simply can’t grow if you manage your processes manually. Tools like the email or Excel spreadsheets are temporary solutions. Excel spreadsheets become unmanageable and useless. Something similar happens with the emails. Consequently, you need more formal tool to manage them.
So, What is BPM? It is a discipline (methodologies + technologies) to automate and improve business processes that sustain your operations. It is based on 4 stages: modeling, automating, measuring and improving. Cloud BPM Suites like Flokzu helps you to complete improvement cycles in hours (not days, not weeks).
The example that we presented in this post shows clearly these effects. Therefore, it’s important to understand that all other processes in a company eventually face this reality. Almost every process (production, administrative, or customer-related) could be improved.
It is impossible to grow and compete unless you understand “What is BPM”, and how it can help your processes. The sooner you start, the better you will perform.
- In this post we discussed the main difficulties and fears of a SME when using BPM and we suggested specific solutions to face those issues before they become irreversible.
- This free ready-to-use process library, lets you take a workflow model that has been useful to other companies, adapt it to your needs and start using it within minutes.
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