Title: Business Process Intelligence
1Business Process Intelligence
- by
- Hoda M. Hosny
- Consultant at CRCICA and SECC
- Adjunct Professor of Computer Science, AUC and
MIU - ATIT 2009, Cairo, January 19-20, 2009
2Action is the real measure of intelligence -
Napoleon Hill It is wiser to find out than to
suppose - Mark Twain
Nari Kannan, 2008
3Outline
- 1. Business Process Management
- 2. Essential BPM Issues
- 3. Business Process Intelligence
- 4. The State of the BPM Market
41. Business Process Management
- Business Process Modeling (BPM)--sometimes known
as Business Process Management-- is a set of
technologies and standards for the design,
execution, administration, and monitoring of
business processes. - A business process is the flow or progression of
activities (the "boxes")--each of which
represents the work of a person, an internal
system, or the process of a partner
company--toward some business goal. - The BPM market is one of the fastest growing
software markets.
5The Business Process Management Space with Some
Technologies
BPT, July 2004
6Process Modeling and Business Rules
- Process Modeling is the use of information and
graphics to represent processes in a consistent
way. It typically includes a knowledge repository
or database of processes and allows graphical
entry and display of results. - Process modeling typically produces multiple
views or diagrams of a process (such as UML
Activity Diagrams) which provide for Business
Rules to be expressed. - Textual business modeling languages, executable
or non-executable have recently emerged to become
industry standards as well.
7Example of a Simple Business Process White,
S., 2006
8Example of A Collaborative B2B Process
White, S., 2006
9Example of A High Level Business Process
White, S., 2006
10White, S.,2006
Example of a Low Level Business Process
11Industry Standards for Business Modeling Languages
- Business modeling is supported by a mix of
emerging industry standards that include the
following - Business Process Modeling Notation (BPMN) A
graphical notation for representing business
processes. BPMN defines a Business Process
Diagram, which is based on flowcharting
techniques customized for business process, and a
mapping to BPEL executable semantics (next
slide). The BPMN industry standard is maintained
by the OMG (Object Management Group) - Unified Modeling Language (UML) The
industry-standard visual modeling language for
specifying software-intensive systems can also be
used to model business processes. In particular,
UML Activity diagrams provide many of the
workflow modeling constructs furnished by BPMN.
The UML industry standard is maintained by the
OMG.
12Industry Standards for Business Modeling
Languages (contd.)
- Business Process Executable Language (BPEL) An
XML-based executable language for representing
business processes. BPEL focuses on the view of
one business participant. The BPEL industry
standard is maintained by OASIS. - Web Services Choreography Description Language
(WS-CDL) An XML-based non-executable language
that represents global business processes.
WS-CDL describes peer-to-peer collaborations of
multiple business participants working on a
common business goal. The WS-CDL industry
standard is maintained by W3C.
13Travel Booking process with BPMN
White, S., 2005
14BPMN is supported by software tools
White, S., 2005
Travel Booking process with WebSphere Studio
15Mapping BPMN to BPEL (for the check credit card
task)
White, S., 2005
16BPEL code for the check credit card task
White, S., 2005
17Event Process Chain (EPC)
- Developed within the framework of Architecture of
Integrated Information System (ARIS) - Developed from the business prospective rather
than IT - Contains lots of ambiguities and deadlocks
18EPC (example)
Ferdian et. al, 2001
19Primary Components of BPM Suites
- Although BPM suites functionality differ, there
is general agreement that a BPM suite includes
the following - Process Modeling Tool.
- This is where a non-technical user (such as a
business analyst) can create a flowchart-like
model of the business process, and technical
users can connect the model to Web services and
other points of integration. A single shared
model is most desirable so that important
information from one audience isnt lost in the
handoff to the other. To qualify as BPM, the
model must be executable, or able to force action
on the process design, sending tasks to people,
and messages to systems, for example. - Server-based Process Execution Engine.
- This engine orchestrates all processes and
their resourcespeople, organizations,
applications, and systemsmanaging proper
sequences, enforcing business rules, and auditing
each step to ensure flawless process execution,
escalation, and exception management.
Oracle White Paper, Aug. 2008
20Primary Components of BPM Suites contd.
- Browser-based workspace.
- This is an interface where human process
participants can locate, open, and complete the
tasks assigned to them within the BPM suite. - Intelligence dashboards.
- Both historical and real-time process
monitoring, reporting, and analytics dashboards
are used to disseminate information to all users.
- Simulation and optimization capabilities.
- Tools are employed to support testing,
analysis, and continuous process improvement.
Oracle White Paper, Aug. 2008
21Other Optional BPM Suite Components
- Business rules engine or decision services. These
can be used to build, execute, and manage
business rules. - Content management. This is a repository for
attachments to processes. - Collaboration. This offers support for
unstructured interaction within a process. - Enterprise service bus (ESB). This is a
service-oriented integration layer underneath the
BPM suite. Although all BPM suites support direct
Web services calls, an ESB includes functions
such as mapping and transformation. - Industry-specific or application-specific
frameworks. These shorten the customization time
for standard processes such as employee
on-boarding.
Oracle White Paper, Aug. 2008
22Common Visual Notation for Process Diagrams
A BPMN Diagram
Oracle White Paper, Aug. 2008
23The Evolution of BPM
In 2000, analysts began combining EAI and
workflow into a single category BPM.
Oracle White Paper, Aug. 2008
24SOA infrastructures help drive enterprise-wide
BPM Adoption
Oracle White Paper, Aug. 2008
25Seamless Interchange of Process Models Between
Tools
- The interchange of process models between tools
is a challenging problem. Until BPM technologies
and associated standards mature further, some
level of custom integration work will be required
to move models between tools. - XML Process Definition Language (XPDL). XPDL is
an interchange format created by the Workflow
Management Coalition. XPDL is today supported by
more than 70 vendors. - BPEL. Created by the Organization for the
Advancement of Structured Information Standards,
BPEL is a Web services orchestration language.
For system-centric use cases, BPEL is considered
mature and dominant. - Business Process Definition Metamodel (BPDM). A
newly released process definition standard that
provides full support for all BPMN objects.
Oracle White Paper, Aug. 2008
26An Overview of the various domains of Business
Process Management
BPT, July 2004
272. Essential BPM Issues
- Business Process
- Business Continuity
- Business Solution
28Business Process
- While not a new way of analyzing a business,
Business Process thinking and technology have
transformed today's information systems and
reduced the lag between management intent and
implementation. - A process-managed business makes agile decisions,
embeds quality and reduces cumulative costs
across the organization. It pursues strategic
initiatives with confidence and direction. - Business Process Management is the only way to
achieve these objectives with transparency,
management control and accountability.
KeyITSolutions
29Business Continuity
- Protecting business systems and planning a
recovery strategy is a vital part of any Business
Continuity Plan. - Any strategy must balance the short and long term
goals of a business in times of a disaster. - The continuity of a business is important and by
evaluating different recovery processes, you need
to strike the balance between what you need to
protect your business and what you can afford.
KeyITSolutions
30Business Solutions
- Business Solutions involve reviewing your
business to identify an area which is
under-performing in a big way or an area that is
out-dated and in need of replacement. - These areas can often be improved by the
introduction of a single integrated Business
Solution. - Key areas of a business such as finance, human
resources and internet services can all be
improved with the introduction of a dedicated
Business Solution.
KeyITSolutions
31Business Solutions contd.
- When it comes in the form of an existing product
which is shaped to meet an organizations
specific needs, a business solution can be a very
cost-effective approach to improving performance
and costs. - Many companies will offer a complete Business
Solutions package. - This will include reviewing business processes,
customizing the product, implementation of the
business solution, staff training and the
important post-implementation support until the
company is utilizing the solution efficiently.
32Business Performance Management
- There's a lot of noise in the marketplace about
corporate, business, and enterprise performance
management. - Regardless of the term used, the ability to apply
performance management principles to daily
operations to optimize overall efficiency,
continuously improve quality, and assign value to
tangible and intangible assets is now the
ultimate goal of most large business
organizations.
Mark Smith, 2002
33A Pyramid showing the various Performance
Technologies
BPT, July 2004
343. Business Process Intelligence
- Business Process Intelligence (BPI) is an area
that is quickly gaining interest and importance
in the industry. - BPI refers to the application of various
measurement and analysis techniques in the area
of business process management.
35BPI Defined
- Business Intelligence is the collection,
integration and analysis of a broad variety of
processes and technologies to help a business
make sound decisions. - Business intelligence may take into account such
activities as statistical analysis, data mining
and financial forecasting.
36BPI
- In essence, BI systems rely on algorithms derived
from data analysis (OLAP) and Artificial
Intelligence (AI) to search data - and to identify interesting patterns or
trends.
37BPI Goals
- The goal of BPI is to provide a better
understanding and a more appropriate support of a
company's processes at design time and the way
they are handled at runtime. - In practice, BPI is embodied in tools for
managing process execution quality by offering
several features such as analysis, prediction,
monitoring, control, and optimization.
BPI, 2007
38Facts about BPI
- Business intelligence (BI) has been referred to
as the process of making better decisions through
the use of people, processes, data and related
tools and methodologies. - The roots of business intelligence are found in
relational databases, data warehouses and data
marts that help organize historical information
in the hands of business analysts to generate
reporting that informs executives and senior
departmental managers of strategic and tactical
trends and opportunities
DMReview.com
39Performance as a Network
- The question is, how can an organization
transform its existing, transaction-oriented
information architecture into a performance
management network?
40The Performance Management Network
The most important aspect of this network is the
ability to continuously manage performance at all
three decision levels, not just measure
historical performance.
Mark Smith, 2002
41Business Processes across the Organization
- Recent advances in
- business process management (BPM), business
performance management, enterprise application
integration (EAI), business intelligence (BI),
simulation systems, and data warehousing - have come together to make it possible to
continuously monitor and measure business
processes across the organization.
BPT, June, 2004
42Business Process across the Organization contd.
- These various technologies make it possible to
identify, interpret, and respond to critical
business events almost as soon as they happen.
(This real-time BI is frequently termed
"Operational BI "). - Until recently, most companies were using BI and
data warehouses to report trends to specific
departments within a company.
BPT, June, 2004
43Business Activity Monitoring
- The new emphasis on integrating BI with business
processes has placed the emphasis on reporting
the results within a process framework to those
who must actually make process management
decisions. - Some have termed this new application of
Operational BI data, BAM (Business Activity
Monitoring). - Recently, Business Process Intelligence (BPI) has
emerged as a another term for using Operational
BI to inform business process management
decisions.
BPT, June, 2004
44Business Performance Management
- Instead of providing decision support based on
data that is months or weeks old, BI is now being
used to generate (automated) findings based on
current transactional data that have been
analyzed in real or near real time. - This instantaneous analysis capability is most
significant, because it facilitates the use of
digital dashboards and other business performance
measurement applications that can monitor and
measure key business processes across the
organization and distribute their findings to
various classes of corporate decision makers
residing at different organizational levels. - This is now known as Business Performance
Management
BPT, June, 2004
45Basically, Business Performance Management is a
technology that connects process measures,
metrics, and people in order to drive improved
management, analysis, and decisions across the
organization.
BPT, June, 2004
46The Advantages of BPI
- Hence, BPI is a valuable approach that can help
companies carry out their process improvement and
process management initiatives by - Providing a consistent, process-based view of the
organization - Facilitating real-time monitoring of key business
process and information systems - Aligning execution with strategy
- Managing enterprise performance
BPT, June, 2004
47Basic Requirements for BPI
- The ability to apply performance-driven
management techniques to daily operations has
several requirements, including - 1. The ability to manage performance across
different business processes (i.e.,
customer-facing activities, finance and
accounting operations, supply-chain, and human
resources). - 2. The ability to manage performance at different
organizational levels (i.e., executive,
management, and individual rank-and-file
employees).
BPT, June, 2004
48Basic Requirements for BPI contd.
- 3. The ability to acquire an overall view of how
different processes are functioning. - 4. The ability to notify appropriate people of
important business events as they happen so they
can take proactive action to capitalize on/or
mitigate their effect. - 5. The ability to do this in real or near
real-time.
BPT, June, 2004
49Problems with the Requirements
- The above requirements are difficult for a
company to achieve because most organizations
have fractured infrastructures based on
individual transaction processing systems (ERP,
CRM, SCM, Web, etc.). - Although many of these applications do feature
their own individualized reporting systems, they
all use their own unrelated metrics. Moreover,
they typically cannot integrate and analyze data
residing on other operational systems.
BPT, June, 2004
50Taking the Pulse of the Company
- New Business Process Management (BPM) tools are,
in effect, a combination of traditional workflow
and Enterprise Application Integration (EAI)
tools and, in many cases, offer a better way to
manage integration. - They begin by defining a business process and
then integrate supporting IT resources into the
process model. - At the same time, metrics can be defined in terms
of the overall process. - In effect, by layering a BPM layer on top of
existing systems, companies are finding it easier
to integrate than in the past
BPT, June, 2004
51A Move to the Operational Level
- Operational BI combines real-time operational
transaction data with historical information to
let decision makers move beyond the
point-in-time analysis associated with
traditional BI and data warehousing applications.
- The goal is to provide immediate access to key
performance indicators (KPIs) in order to improve
the speed and effectiveness of the
decision-making process.
BPT, June, 2004
52Traditional BI vs. Operational Business Process
Intelligence (BPI)
BPT, June, 2004
53Traditional BI
- Traditional BI -- so called because it is
associated with early corporate BI and data
warehousing efforts -- is primarily used to
provide analysts and other skilled knowledge
workers with the ability to conduct analysis and
reporting to support both strategic and tactical
decision-making needs. - For example, Should we enter a new market or
develop a new product? - Or,
- who were our best customers last month?
BPT, June, 2004
54Operational BI
- Operational BI is enabled by understanding
transactions, as they are generated by
operational systems, in the context of
information stored in the data warehouse. - The ability to combine real-time and historical
data for Operational BI is important because just
examining real-time data typically does not
provide enough of the kind of insight that is
required for business users to arrive at an
informed decision.
BPT, June, 2004
55Operational BI Examples
- For example, an application that only gives a
real-time tally of the latest sales figures for a
particular marketing campaign does provide some
useful information. - However, to be of real benefit, the application
should compare current sales in relation to
previous sales for a similar marketing campaign
in order to identify trends that put the current
figures into some kind of business perspective
from which decision-makers can make a
well-informed decision. - Another example a supply-chain purchasing
manager can negotiate better discounts with
suppliers when processing new orders, based on
consistent and current consolidated purchasing
activity and historical supplier performance
ratings.
BPT, June, 2004
56Operational BI Examples contd.
- Similarly, a bank can generate continuously
up-to-date customer-profiles by integrating
transactions and activities from different
channels with historical customer data. - This allows the bank to target the customer with
new promotions regardless of which channel the
customer chooses to use physical branch, online
banking, or remote automated teller machine.
BPT, June, 2004
57Comparison between Traditional BI and Operational
BI
BPT, June, 2004
58Distributed BI
- The ability to monitor and measure business
processes is but one part of solving the Business
Performance Management equation. - The other requires the ability to distribute and
present analytic findings so that decision makers
have ready access to the metrics necessary for
managing business performance at different
organizational levels specifically to
executive, management, and individual
rank-and-file employees.
BPT, June, 2004
59Distributed BI contd.
- This has resulted in the growing use of
- (1) digital dashboards,
- (2) automated broadcasting and event
notification servers, and - (3) analytic workflows.
- These are designed to distribute and present KPIs
to various users according to their
organizational roles.
BPT, June, 2004
60Digital dashboard displaying an executive
overview of company financial, customer internal,
and learning and growth processes.
BPT, June, 2004
61Monitoring and Tracking
- Monitoring your current business is also
important when building Business Intelligence. - Knowing what is working well within your
organization will subsequently allow you to focus
on areas that are in need of improvement, either
due to performance issues or cost. - Use of intuitive tools by both staff and
management to distil information from your
business will provide you the base to develop
your Business Intelligence plan. - Review of all your corporate assets is vital
omitting areas will lead to deficiencies.
KeyITSolutions
62Monitoring and Tracking
- Corporate assets include customers, products
services, network infrastructure and employees. - Typical performance measurements include
profitability, availability, usage, sales and
lifetime value. - An organization can then track their key
performance measurements, refine customer
segments scores and optimize campaign
strategies.
KeyITSolutions
63Business Process Metrics
- Systematic understanding of business process
metrics and how they interplay with each other
provides a lot of answers to dilemmas and
questions companies may face in their operations. - Business processes have Efficiency factors and
Effectiveness factors. Sometimes they go along
with each other well and sometimes, they may not.
Nari Kannan, 2008
64Example
- Many companies may want to provide absolutely the
best customer service or support on the phone. - Given this, they may need to staff their call
center with the best personnel around and in very
large numbers so that no one is kept waiting on
the phone, at all. - And the customer service person stays on the
phone as long as the customer is satisfied fully.
This however, we know, is not practical.
Nari Kannan, 2008
65Example contd.
- The Call Center manager is measured on efficiency
also. - They may need to staff the call center with the
minimum number of people at exactly the right
times of the day so that every agent is fully
utilized and each call takes exactly the amount
of time needed to do a good job and keep the
customer satisfied!
Nari Kannan, 2008
66Example contd.
- Here we see the opposing nature of
- Efficiency Metrics like Average Handle Time
- and
- Effectiveness Metrics like Customer Satisfaction
Index!
Nari Kannan, 2008
67Another Example
- Business Process Intelligence also helps small
companies compete with larger companies and vice
versa! - In the above example of a company having to deal
with competing metrics like Average Handle Time
on the phone and Customer Satisfaction, - If the company were a small company trying to
take business away from biggies like XYZ.com, the
strategy may be to relax the requirements on
Average Handle Time and maximize Customer
Satisfaction Index till it starts taking market
share away from XYZ.com.
Nari Kannan, 2008
68Another Example contd.
- On the other hand if the large company faces
large financial pressures, they may not be able
to do the same thing easily. - Thus, it becomes one of adjusting your various
Efficiency and Effectiveness factors based upon
what your business strategy is, and tactics are
at any point of time.
Nari Kannan, 2008
69BPI Extensions
- More than Sales Intelligence or Financial
Intelligence, Business Process Intelligence
provides you with objective measurement of your
various activities within the company. - You can get a sense of how you are performing
currently,where your bottlenecks are and what to
address within the company process-wise.
Nari Kannan, 2008
70The Predictive Enterprise
- The predictive enterprise is an IT infrastructure
that supports business operations by delivering
informed predictions about what is likely to
happen in a business process. - Implementing a predictive enterprise presents
both cultural and technological challenges
DM Review, 2008
71The Predictive Enterprise contd.
- A predictive enterprise starts with understanding
the business processes that are at the core of
most OLTP systems. - To deliver the most value, a predictive
enterprise solution needs to be used at an
operational level by making predictions about
individual transactions, irrespective of whether
this is a customer interaction, sales transaction
or supplier transaction. - The first step in developing a predictive
enterprise is to identify business processes that
can benefit from adding predictive elements.
DM Review, 2008
72The Predictive Enterprise contd.
- The central objective of implementing a PE is to
use the companys knowledge about its past
business activities, stored in data warehouses,
data marts, log files, and other sources, and the
current state of business operations to make
predictions about future events. - These predictions can be used to support the
decision making of all individuals in an
organization (that is, BI). - Examples of applications include the intelligent
promotion of offers to specific users on your Web
site, providing differential services to your
best customers and detecting fraudulent
transactions.
DM Review, 2008
734.The State of BPM Market
- In a survey report (Aug 2008), an Oracle produced
White Paper summarized the State of BPM market in
the following 5 points - Rapid market growth. The BPM market is one of the
fastest growing software markets, estimated to
grow tenfold in five years, from approximately
US500 million in 2006 to US6 billion in 2011. - Market consolidation and technology convergence.
The BPM market is consolidating from nearly 150
vendors recognized in 2006 to just 25 in 2007.
Large enterprise-class vendors are replacing the
small pure plays, offering more-holistic
solutions that combine BPM with collaboration,
portals, document management, service-oriented
architecture (SOA), and business intelligence
(BI). - Ability to quickly bridge gaps. BPM is
increasingly being used to manage processes that
span multiple packaged applications.
Oracle White Paper, Aug. 2008
74The State of BPM Market A Survey
- Beyond technology. Survey reports show that
organizations with successful BPM deployments not
only focus on the technology, but they also see
continuous process improvement as an imperative
business strategy. - BPM, collaboration, and social computing. New
tools allow business users to participate in
building, managing, and monitoring applications
like never before. Leading BPM products support a
range of collaborative and social process
activities that today are lost in e-mails,
documents, and hallway discussions. In an
information economy, organizations must capture
these unstructured processes to improve
productivity and leverage best practices.
Oracle White Paper, Aug. 2008
75Top Managers surveyed by Robert Half Management
in November 2007 highlighted process improvement
as the most likely corporate initiative to pursue
in 2008 and 2009
Business Process Improvement Technology
Upgrade New Product or Service Line
Expansion Geographic Expansion Merger or
Acquisition
Oracle White Paper, Aug. 2008
76Survey Results onAnticipated Drivers of ROI from
BPM investments
- Automating/accelerating highly manual process
- Increasing visibility into processes
- Improving operational excellence
- Improving control over processes
- Simplifying cumbersome processes
- Promoting better business and IT alignment
- Improving delivery of new products or services
- Establishing greater governance compliance
- Improving predictability of processes
- Improving customer intimacy or service
Oracle White Paper, Aug. 2008
77The most important BPM Obstacles to overcome
Understanding Process Org. Issues Internal
Policies Lack of Training Internal
Staff Excessive Scope Creep Budget Overrun
Oracle White Paper, Aug. 2008
78BPM Maturity is Still in the Early Phase
Ad-Hoc Departmental 43
Coordinated Line of Business 17
Enterprise-Wide BPM 18
Little to No BPM 22
Oracle White Paper, Aug. 2008
79Another recent survey (2007) found only 11
percent of respondents were actively integrating
BPM suites across the enterprise.
Oracle White Paper, Aug. 2008
Most organizations are only leveraging BPM at the
departmental level, leaving substantial value
untapped.
Oracle White Paper, Aug. 2008
80Some BPM Resources
- Industry Resources
- BPM Institute. A peer-to-peer exchange for BPM
professionals. The BPM Institute publishes an
objective report of BPM suites.
www.bpminstitute.org/bpmsreport.html. - Business Process Trends. A news source on
business process change, trends, directions, and
best practices. www.bptrends.com. - BPM Suite Watch Blog by Bruce Silver.
www.brsilver.com/wordpress. - Column 2 Blog by Sandy Kemsley on BPM and
Enterprise 2.0. www.column2.com. -
- Standards Bodies
- Object Management Group. This organization
oversees Business Process Modeling Notation
(BPMN) and Business Process Definition Metamodel
(BPDM), among others. www.omg.com. - Workflow Management Coalition. This organization
oversees XML Process Definition Language (XPDL),
among others. www.wfmc.org. - OASIS. The organization that oversees BPEL, among
others. www.oasis-open.org.
Oracle White Paper, Aug. 2008
81References
- BPI07, BPM-Research, http//www.bpm-research.com/
- Hall, Curt Business Process Intelligence,
Business Process Trends Newsletter Volume 2, No.
6, June 2004. - Harmon, P. Business Performance Management The
Other BPM, BPT Newsletter, Volume 2, no. 7, July
2004. - KeyITsolutions, http//www.keyitsolutions.com/
- Kannan, Nari BPI What is it and how does it
help Sept. 2008 - Oracle, State of the Business Process Management
Market 2008 An Oracle White Paper, August 2008 - Rowe, Anthony From Business Process Management
to Business Process Intelligence The Road to the
Predictive Enterprise, DM Review Magazine, April
2008. (www.drmreview.com/ - Smith, Mark, http//www.intelligententerprise.com/
, Dec. 2002 - White, S. A., Introduction to BPMN, IBM IBM
Software Group, 2006, http//www.bpmn.org/ - White, S.A., Using BPMN to Model a BPEL
Process, IBM Corp., 2005, http//www.bpmn.org/