Business Process Modeling: An Introduction

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Business Process ModelingAn Introduction

• Presented by
• Jeff Howey
• IIBA Central Iowa Meeting, May 2006

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Introduction to this Presentation

• This presentation is intended to be an overview
  and introduction to Business Process Modeling
• Uses a real process to help understanding
• Uses simple tools (Word, PPT, Visio)
• Exhibits different formats that may work in
  various situations
• This presentation IS NOT intended to discuss
  BPML, BPEL, or even UML diagramming
  standards/notation
• These require specialized training
• Few are comfortable with these deliverables in
  most business environments
• Today is about PROCESS and TIPS for conducting
  your own modeling activities.
• Mastery of the Art, Science and Sport of Business
  Process Modeling requires training, practice,
  patience!

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What is a Business Process?

• A collection of related, structured activities--a
  chain of events--that produce a specific service
  or product for a particular customer or
  customers.www.gao.gov/policy/itguide/glossary.htm
  
• The complete response that a business makes to an
  event. A business process entails the execution
  of a sequence of one or more process steps. It
  has a clearly defined deliverable or outcome.
  ...www.georgetown.edu/uis/ia/dw/GLOSSARY0816.html
  
• A business process is a recipe for achieving a
  commercial result. Each business process has
  inputs, method and outputs. The inputs are a
  pre-requisite that must be in place before the
  method can be put into practice. When the method
  is applied to the inputs then certain outputs
  will be created. en.wikipedia.org/wiki/Business_p
  rocess
• What PEOPLE do to meet the needs and expectations
  of their CUSTOMERS, whether they be internal or
  external consumers of a product or service.

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A Brief History of Business Process
Early 1900s Breaking a job into individual
tasks. Fredrick Taylor, Principles of Scientific
Management
Early 90s Reorganize the business and business
processes to cut across traditional corporate
silos and deliver on customer value
chain. Champy Hammer, Reengineering the
Corporation
Mid 90s Our business processes need to be
completely documented, consistently followed and
regularly audited. ISO9000 certification
90s 00s Pull many of the previous techniques
into a comprehensive framework focused on
quantitative measures and process
improvement. Six Sigma
Future Trends Maturation of modeling workflow
tools into full process management systems.
Integration of business process improvement and
measurements into corporate strategic
goals. Additional emphasis on the human side of
business change. Integration of process
management systems with business rules engines
and application development tools.
90s 00s Application-centric workflow tools
used to automate business processes. Some
include integrated process modeling metric
reporting.
Mid 90s Radical reengineering is hard, maybe we
should focus on incrementally improving our
processes. Harrington, Business Process
Improvement
70s 80s Focus on quality management and
statistical measures. (Total Quality Management
TQM) W. Edwards Deming, Fourteen Points of
Management for Quality
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What is a Business Process Model?

• Documentation of a business process using a
  combination of text and graphical notation.
• Depicts the Process that People employ to provide
  value to their Customer with a strong emphasis on
  how the work is done.
• Defines a process as a specific ordering of work
  activities across time and place with a
  beginning, an end, and clearly defined inputs and
  outputs.
• A component of the overall Business Architecture
  that serves as a reference for Business Analysis
  activities.

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Why Model a Business Process?

• BABOK Describe the functions associated with
  the business activities... and the inputs,
  controls, outputs, and mechanisms/resources used
  of those activities. (v1.4 Sec 2.2.20.1)
• Understand how labor and resources are used to
  create products or services for a companys
  Customers. Identify areas that could be improved,
  made more efficient and re-engineered
• Create an understanding of where
  Systems/Applications can or do automate or
  streamline human or mechanized processes
  capture requirements
• Integrate activities between departments/companies
  especially necessary after a merger of
  different groups of People producing similar or
  dependent products/services
• Assist in implementation and acceptance of Six
  Sigma, ISO, CMM or other standards
• What other uses can you see? The list is endless

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What does a BPM look like?

• It Depends

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Business Process Methodology The Basics

• The most basic approach consists of developing an
  As-Is model and using it to build the desired
  To-Be model
• Here are a few of examples

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Business Process Maturity Steps
It is normal and expected to learn as you go
and progress in maturity at both the individual
and enterprise levels
Integration

• Advanced process modeling and simulation tools
• Process models are tied directly to workflow
  application
• Integration of workflow applications and
  other IT systems
• Changes implemented by changing process
  models
• Continuous monitoring of process metrics and
  results

Improving agility, quality and efficiency
Automation

• Function-specificworkflow applications
• Workflow application-specific process models
• Changes implemented by IT modifications
  toapplications
• Regular metrics publishedfrom workflow tools

Understanding

• Process flow pictures
• Defined business and ITchange implementations
• Periodic metric gathering and evaluation

Ad-Hoc

• Doing what it takes to get the job done

I cannot say whether things will get better if
we change what I can say is they must change if
they are to get better. --Georg Christoph
Lichtenberg
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The Goal Integrated Process Improvement
Process Design
Process Evaluation

• As-Is modeling analysis
• As-Is verification
• Process simulation
• Improvement opportunities
• To-Be vision design
• Implementation planning

• Metric gathering (manual automated)
• Scorecard/Dashboard publishing
• Metric goal vs. actual analysis
• Issue identification and trending

Business Strategy Goals

• Strategy mapping
• Metric framework development
• Goals incentives design
• Initiative identification

Process Implemen-tation

• Procedure and guidelines updates
• Training
• Organizational change management
• Tool technology improvements
• Workflow implementation

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Common Methods of Modeling

• BPML Business Process Modeling Language
• An Extensible Markup Language (XML)-based
  meta-language developed by the Business Process
  Management Initiative (BPMI) as a means of
  modeling business processes
• BPEL Business Process Execution Language
• An XML-based language designed to enable
  task-sharing for a distributed computing or grid
  computing environment - even across multiple
  organizations - using a combination of Web
  services.
• BPMN Business Process Modeling Notation
• A standard graphical notation used to facilitate
  the understanding of business transactions
  between organizations.
• UML Unified Modeling Language
• A notation that allows the modeler to specify,
  visualize, and construct the artifacts of
  software systems, as well as business models.
• USE WHAT WORKS FOR YOUR PROJECT ENVIRONMENT!
• Do what you know. Learn to do more. But dont
  fake it.

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Start Simple
Even when a basic BPM format is used, if the
information from this example is included, it is
likely a successful format!
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Tailor Your Model to your Project Self

• BPML, BPEL, etc. are well and good if
• You are trained and comfortable with their use
• Your target audience (Business first, Tech Team
  second) understands and is comfortable with their
  use
• Beware! Most organizations are not properly
  equipped or trained to produce documentation with
  these standards!
• Valid alternatives include using Visio, Word,
  PowerPoint, Impress or other tools that can
  represent activities graphically with text!

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Where do I start?

• Start with a Plan What am I going to do?
• Identify what tangible value (product or service)
  is being produced that you need to understand
• Start at the top of the value chain and work
  downward and work downward to identify the People
  and Entities involved in the Process
• Start at the bottom of the value chain and work
  upward and work upward to fully understand the
  accomplishments of each step that lead to the
  desired results
• Setup and complete Interviews of the People (or
  a fair representation of large groups)
• Interviews may also uncover new People or
  peripheral Processes that you had previously not
  detected
• Set a course and work methodically
• Dont set out to boil the ocean from the outset
• Work in a progression that makes sense to you
  and/or your project
• End with a Plan what am I going to do now?

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Process Modeling Layers

• Start at the Top, and work Down!
• Enterprise Value Chain Layer
• The highest level describing the overall
  functions of the organization
• Great for management overview for everyone, too
  vague for much use
• Enterprise Processes Layer
• Describes the major processes within a part of
  the value chain and how they relate to each other
• Ideal for understanding overall Business
  Architecture, Strategy and Goals/Vision but too
  broad for requirements

Vision Strategy
SubscriptionMarketing
Ad Sales
Customer Care
SubscriptionMaintenance
Identify Prospects
Build Ad Partners
Process New Subscriptions
Acquire NewCustomers
ProcessRenewals
Business Processes Tasks
Print Procedures 1. Open MS Word 2. Open the
document 3. Select File Print 4. Select a
printer 5. Press the OK button
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Process Modeling Layers

• Start at the Bottom, and work Up!
• Business Processes/Activities Layer
• Describes the main activities, decisions and
  variations with a process
• Critical to defining areas of improvement,
  feature statements and Use Cases but too detailed
  for strategic planning and too open to
  interpretation for requirements steps
• Procedural/Tasks Layer
• Describes the detailed steps done to complete an
  activity (can be many layers deep)
• Necessary for detailed Use Case Steps, Business
  Rules, Validation Criteria, etc. but loses the
  attention of management at Strategic level

Vision Strategy
SubscriptionMarketing
Ad Sales
Customer Care
SubscriptionMaintenance
Identify Prospects
Build Ad Partners
Process New Subscriptions
Acquire NewCustomers
ProcessRenewals
Business Processes Tasks
Print Procedures 1. Open MS Word 2. Open the
document 3. Select File Print 4. Select a
printer 5. Press the OK button
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Conduct Interviews

• Schedule enough time to ask questions about what
  a Person does but to also watch them perform
  their duties for a period of time
• Document everything that is said and pay special
  attention to the specific order of events,
  pre-requisites, inputs and outputs, constraints,
  things that work well vs. things that need
  improvement
• Ask Questions and begin Analyzing on the spot

Downloadable sample at www.mentortek.com/bpm/
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Analyze!

• The deliverable of a Business Analyst conducting
  Business Process Modeling is rarely to document
  the status quo process. Do something with the
  knowledge, you may be the only person in an
  organization with both the big picture and
  details!
• Analyze the process and INVENT ways to improve or
  modify the process with a new or modified
  system (not always a computerized system!)
  even during the interview!
• What did the People like that should continue?
• What did the People dislike that could be fixed?
• Where was the Process inefficient or constrained
  in a way that could be improved?
• Were any opportunities to automate repetitive
  functions identified?

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Things to Remember

• When an output is heavily dependent on
  complicated Human Logic or subjective review, it
  is generally not easy to automate, but could be
  improved in other ways!
• Your inventions may have a drastic impact on
  the People involved in a Process be sensitive
  to the corporate culture and understand the
  impact BEFORE you present alternatives
• Test your ideas with both early adopters
  laggards
• Make sure you have a Sponsor/Champion on your
  side

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Sample Business Process

• New Magazine Subscription
• Jan googles (its a new word, trust me)
  information on Parrots one afternoon after she
  buys a new bird
• Google returns a link to the Parrots R Us
  magazine website
• Jan signs up with an online form to receive a
  2-month free trial to receive the magazine
• Parrots R Us wants to do everything they can to
  sell a 2-year subscription of their magazine to
  Jan
• What is the Business Process and Model?

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Jan Signs Up for the Free Trial

• Marketing has worked with Google to place an ad
  online Not part of this Process Model
• Jan enters the homepage for Parrots R Us which
  has a readily visible Free Trial online sign up
  form Created by Marketing IT
• The information entered by Jan (Customer) is
  submitted to the Subscriptions System when she
  saves her entry Lets begin here
• We understand that Jan is required to enter her
  name, address, e-mail, phone number, and type of
  bird that she owns (with options for non-owners
  who are interested in Parrots)
• The Subscriptions System identifies duplicates by
  address and last-name.

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Jans Subscription is Received

• Owen is a supervisor in the Subscriptions (Subs)
  department whose team handles new subscriptions.
  We interview Owen to learn the following
• Jans request is placed in the New Subs Queue
  of the Subs system for processing
• Owens team of 5 Processors share the New Subs
  Queue and work on the list in a FIFO order
• Within 24 hours (1 business day), Jans request
  will be processed for a new subscription

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Jans Subscription is Entered

• At the beginning of the day, each Processor logs
  in and selects the New Sub queue to process
  records. The system automatically selects the
  first record in Queue to be handled
• When one Subscription (Sub) is completed, the
  system displays the next record to be processed
• 2 of 5 Processors indicated the font on the New
  Subs screen of the system is too small to read
  and strains their eyes. Possible enhancement
  requirement to the system
• All 5 Processors felt the speed of the system was
  too slow in the afternoon (between 1 and 4pm each
  day)Possible constraint of the system to be
  investigated

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Jans Subscription is Processed

• The Processor hits the ltF7gt key to validate or
  update the Customers Address
• This matches against USPS standards and
  automatically formats the address, and adds the
  ZIP4 to maximize mailing discounts
• If an address cannot be found, the Processor
  emails the Customer for an updated address and
  the Record is returned to the Pending Subs
  Queue.
• The department email address NewSubs_at_parrots.com
  is used as the return email address.
• The system automatically assigns the Subscription
  Begin date as 30 days from the current date
• Owen believes that it would provide better
  turnaround and Customer Retention to send it in
  10 daysPotential discussion to facilitate with
  Marketing and Sales

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Jans Subscription is Processed

• At the end of the day, each Processor Prints out
  the list of Subs processed (New Subs Report)
• The list shows the Customer Name and Subscription
  begin date
• The printed list is placed in the New Subs
  basket at the end of the aisle
• None of the Processors know what the list is used
  for. Owen sends it interoffice to the Mail Room
  first thing each morningWhat is the goal of
  this interaction?

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Handling Address Problems

• Every Friday, Sally opens the Pending Queue and
  checks against the department inbox to see if any
  customers have responded to requests for address
  corrections
• If no matches are found, the record is returned
  to the Pending Queue for review the following
  week
• If no matches are found for 4 weeks, the request
  for a New Sub is deleted from the system
• Sally believes the company should call the
  Customer since their phone number is required,
  but Owen indicated that Sr. Management did not
  want to incur the expense of phone calls or
  implement a new process to handle incoming calls
  if customers call back
• Sally indicated that she wished there was a
  faster way to match up email responses to the
  system by having the New Sub ID in the subject
  line instead of just matching by the name on
  e-mail addresses

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Initial Business Domain Model

• Before beginning the process modeling exercises,
  it is beneficial to create an initial Business
  Domain Model to identify Who and What are
  involved in the process
• As interviews proceed, add Whos and Whats to
  the domain.
• Also serves as a helpful tool for technical team
  members needing to understand relationships of
  business objects and entities

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Initial Business Domain Model
Validate AddressSet Free-Trial Subscription to
start in 30 days
I want Parrots R Us magazine free for 2 months.
(Submit request online)
Subscriptions System Web Interface receives
request Places request in New Subs Queue
New Subs Processors (5)Actor
Print report at end of each Day
Free-Trial SubscriberActor
Do what makes sense! Some user communities will
work well with Class Diagrams, UML Diagrams, etc.
Others would work better with pictures such as
this. Note the emphasis on Actors, Systems,
possible Use Cases (activities and goals) and
outputs
(Owen) Collate all New Subs reports
New Subs Reports for Mail Room
Daily New Subs Reports
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New Subs Processor Business Process
Note each of these activities has additional
detailed steps that are best explained in text
procedures
Focus placed on Activities of a Person with
little regard to systems
This is a fairly basic and immature format, but
will help communicate issues in the early stages
of requirements discovery and dependencies
between processes
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New Subs Business Process (w/system)
Begins defining a Business Object using a Class
Diagram for the Free-Trial Request
Swimlanes can help define boundaries in the
flow of activities between departments,
individuals, systems, etc.
Focus placed on Interactions of a Person with a
System
This format is a little more mature and begins to
detail out the input and output items,
dependencies and ownership of processes
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Can We Re-Engineer?

• Automate the Processing
• If address is good, auto-process and free up
  Processors for other duties
• If address is bad, add to Pending Queue (same as
  now) for manual resolution
• Call the Customer (now that there is time) and
  process address corrections over the phone
• Higher customer service
• Free up New Subs team to help with Renewals
• Can this increase growth? Cut costs?

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What could the new Process Be?
Listening to requirements and vision statements
during your Process Analysis allow you to invent
Use Cases that may improve the overall
system The diagram becomes more mature as
additional Entities gain detail Each process can
map off to individual task level or to Use Case
steps and additional requirements
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Use a Format that makes Sense

• The following diagrams are for the Parrots
  Marketing Business Process
• Compare how a format that works in one setting
  may not work in another
• Be willing to experiment and try new formats that
  communicate details more appropriately

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Marketing Business Process (swim lane format)
When necessary, it is possible to use criss-cross
swim lanes to delineate different types of
ownership or event flow, but in some cases, this
may add confusion rather than clarify the
situation In this example, it is difficult to
grasp input and output items without a system
involved
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Marketing Business Process (alternate view)
Consider a more linear approach and
visually-distinct process model that can be
easily understood by your audience From this
format, identify opportunities to improve or
automate in the same way you would others
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BPM Best Practices

• Ensure a high-level Champion or Steering Group is
  formed to provide executive sponsorship and
  definition of goals in a large process-modeling
  exercise.
• Start small, demonstrate success and build on the
  success. Start with a narrow scope before trying
  to choreograph an entire enterprise business
  process model.
• Ensure business persons expectations are set
  appropriately at the outset otherwise they will
  assume that this project is just like all of the
  other projects that came before and produced few
  tangible results. Make sure you deliver on those
  expectations!
• To be successful, BPM must be a way of thinking
  of the enterprise and building a process into the
  overall business architecture rather just a way
  of documenting steps in a process that appears to
  be independent of the business.

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BPM Best Practices (continued)

• Build Re-Usable Process Components when possible
• Business Objects/Entities
• Customer (Name, Address, E-Mail address, Phone
  Number)
• Customer Report (Name, Date Added, Last Sale
  Date, Credit Rating)
• Loan (Loan Name, Loan Type, Interest Rate)
• Interfaces and Systems
• System Notation, Name, Description
• Interface Name, Description, Purpose,
  Input/Output formats, etc.
• Processes and Activities
• Retrieve Customer Data
• Update Address
• Organizational Structure descriptions
• Department/Division Name, Description, etc. (e.g.

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Recap and Close

• Start Simple
• Do what you know. Learn to do more!
• Educate as you implement (yourself, your business
  partners, others in the enterprise)
• Look for the details in the big picture
• Share your knowledge
• Experiment with formats
• Your primary goal is to COMMUNICATE

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Resources

• www.bptrends.com
• www.bpmi.org
• www.iiba.com
• www.mentortek.com/bpm/
• Final Words Seek out coaching, advice, and
  practice opportunities
• Actively engage in the science, art, and sport of
  Business Process Modeling The more you seek out
  coaching, advice, and practice opportunities, the
  more your technique and ability will improve.
• For more information, to share thoughts, ask
  questions, or discuss training opportunities,
  feel free to email me at letstalk_at_mentortek.com
  or jeffh_at_mentortek.com

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Special Thanks

• I would like to thank the following individuals
  for their help in review and preparation of this
  material
• Brian Steckelberg
• from whom I outright copied several diagrams
  and slides, THANK YOU!
• Sinikka Waugh, Pam Mohr, Jodi Rhone, John Durman
• for reviewing and providing input on this
  presentation, THANK YOU!