CIS591: Business Process and Workflow Analysis Dr. Raghu Santanam

1. CIS591: Business Process and Workflow Analysis Dr. Raghu Santanam Department of Information Systems Session I

2. Introductions • Dr. Raghu Santanam • Faculty at ASU since 1998 • Interests • Business process modeling and applications of IT • Autonomic Computing • Health Care • Cloud Computing • Other Interests: Collaborative Decision Making, Intellectual Property and IT standards

3. Course Objectives • Process Analysis Concepts • Process orientation, High-level analysis, stakeholder analysis • Process modeling • Information, work, roles and people • iGrafx • Collaborative and Iterative Processes • Web 2.0; Blogs and Wikis…Social Computing

5. Why Process Analysis is important? • Process modeling literature gained momentum in the early 90’s • Yet, ROI from process modeling/analysis has been difficult to quantify • Today’s Services Oriented Architecture approach, Web services, outsourcing (IT and BP) bring clarity to the ROI question

6. Why Process Analysis is important? • The IT – Business Bridge

7. Why Process Analysis is Important? Source: Infoworld, March 13th, 2006; Page 20.

8. CIOInsight.com research - 2007

9. CIO.com Research - 2007

10. Methodology • Top-down and Bottom-up • Progress towards standardization – BPMI, WFMC, ebXML. • Business front-end – Technology subsequently • Where useful, simulation and other analytic techniques

11. Classroom interaction • Required and recommended readings • Examples and cases • Complete all readings • Scan blackboard regularly • Read suggested book chapters • Participate and share! • In-class exercises

12. Grading • Participation and exercises • Wikis, Exercises, discussions • Group assignments • Group presentation (20 min/group) • Course Project (No Final Exam) • Rules • Late assignments • Group responsibility • Academic dishonesty • Laptop use

13. Process Analysis: Background

14. Agenda • Background on process orientation • Defining business processes • Principles of process design • How to make process orientation work

15. Business Ideas Marketplace • 1960s and 1970s • Experience curves, portfolio management • 1980s • Quality management and IT • 1990s • Reengineering

16. Business Process • A collection of interrelated tasks, initiated in response to an event, achieving a specific resultfor the customerand other stakeholders. • Events →Tasks → Results

17. Reengineering defined • Radical redesign of broad, cross-functional business processes with the objective of order-of-magnitude performance gains, often with the aid of information technology • Hammer and Champy, 1993

18. A synthesis of ideas • Industrial engineering and Taylor • Porter’s value chain concept • Continuous Improvement and quality movement • Cellular manufacturing • Retro-fitting successful IT projects • Ford (Accounts Payable process); IBM (Credit Process); Mutual Benefit Life (Policy Issue Process)

19. Automation vs process design • Technology innovations change business environment • Legacy processes • Efficiency and control • New watchwords • Flexibility, speed, service and quality • Customer focus • Automation is only a partial solution

21. What process design entails • Understanding business environment and goals • Questioning explicit and implicit rules and assumptions • Credit decisions are made in credit dept. • All purchase orders must be routed through purchase dept. • Expense reports must attach receipts for all items

22. Multidimensional Unidimensional Depth reduces specific process costs (Source: Hall, Rosenthal, Wade, HBR, 1993).

23. Business Unit Single Activity/Function Breadth reduces overall business unit costs (Source: Hall, Rosenthal, Wade, HBR, 1993).

24. A process… • Is outcome oriented • Product development, order fulfillment • Is for a customer and has stakeholders • Has a trigger event • Is a collection of interrelated tasks • Is not a function • Functions are vertical…processes are horizontal

25. PROCESS A PROCESS B Customers Suppliers PROCESS D PROCESS C Defining a process

26. Principles of process design?

27. Non-Workflow Orientation • Collaborative processes • Recurrent/iterative processes • Ad-hoc or non-existent workflow • Information flow/storage/retrieval • Communication patterns • Analysis – solution techniques require tailoring to process context

28. How to make process orientation work • Integrated processes and vertical organizations cause confusion • Management by region, product and function causes conflicts • Organizational chart is a reporting structure • Yet is often the only model that managers understand

29. Organizational Goals Process Goals Process A Process B Process C Process D Goal articulation is key

30. Goal articulation is key Organizational Goals Process Goals Process A Process B Process C Process D

31. Making it work • H & S advocate process management through process owners • Process owners manage and ensure intersection of process and functional unit goals • Budgets by process • Process budgets aggregate to functional unit budgets • Process owners are NOT project managers

32. Process goals • Most managers understand departmental goals…not process goals • Process goals • Organizational goals, customer and stakeholder requirements, benchmarks • Decompose goals at multiple levels (2 or 3) • Relate functional goals to process goals • Process owners focus on the interfaces in the organizational chart w.r.t the process flow

33. Process Owners • Often a senior or top level manager • Cross-functional process performance • Designs, Monitors and reports • Manage the interface between functional departments • Sometimes, process teams may assist the process owner

34. Process and functional goals

35. Organizing… • No single solution exists • Constraints get created • Organizing by function • Interfaces between functions • Organizing by product • Interfaces between products • Organizing by geography • Interfaces between locations and markets • Project oriented organization • Interfaces between projects and processes

36. Commonality between TI, Duke and IBM • Managing the constraints • Process owner solution • Redefine roles and goals for business units • Compensation • Based on process goals (task level) • Training • Broad-based skills

37. Further Reading • Hammer and Champy’s book on Reengineering • Rummler and Brache, “Improving Performance: How to Manage the White Space on the Organization Chart,” Jossey-Bass Publishers, 1995. • Smith and Fingar, “Business Process Management – The third wave” Meghan-Kiffer Press.