What every Enterprise Architect needs to know about BPM and Workflow

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What Every Enterprise Architect Needs to Know about Workflow and BPM Michael zur Muehlen, Ph.D. Center of Excellence in Business Process Innovation Howe School of Technology Management Stevens Institute of Technology Hoboken NJ [email protected] 1

Transcript of What every Enterprise Architect needs to know about BPM and Workflow

Page 1: What every Enterprise Architect needs to know about BPM and Workflow

What Every Enterprise Architect Needs to Know about Workflow and BPMMichael zur Muehlen, Ph.D.Center of Excellence in Business Process InnovationHowe School of Technology ManagementStevens Institute of TechnologyHoboken [email protected]

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BPM is NOT about Technology

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BPM is NOT about Creating Diagrams

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BPM is NOT about Architecture

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BPM is about Improving Business

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BPM: The Business Value Question

BPM, BAM, BI, ESB, SOA, BLI, BLA,

BLUBB...

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All IT is Initially an Expense

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Information Technology

Business Value

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crea

tes

enables

Process Change

All IT is Initially an Expense

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Information Technology X Business

Value

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What is BPM?

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What is BPM?

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Let’s start with the process definition:

A Business Process is the temporal and logical sequence of those activities that are necessary to manipulate an economically relevant object toward an overarching goal, creating value for a customer

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What is BPM?Business Process Management is the collection of methods and tools that allow us to answer questions such as:

What are our processes?

How do we ensure their performance?

How do we maintain their compliance?

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How do you make a Cup of Coffee?

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Boil Water

Thirsty

Put Coffee in CupPut Boiling Water

in Cup

Coffee is Ready

Co

ffe

e L

ove

r

The Nescafè Process

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Boil Water

Thirsty

Put Coffee in

Cup

Put Boiling

Water in Cup

Coffee is Ready

Fill Kettle

yes

no

Clean Cup

Yes

No

Kettle

empty?

Cup dirty?

Water is cold

Co

ffe

e L

ove

rD

ish

wa

sh

er

The Espresso Machine Process

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The Starbucks Process

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Order

cancelled

> 5 min wait

Barr

ista

Coffee S

hop

Cashie

r

Household

Thirsty

Collect

Payment

Go To Coffee

ShopOrder Coffee Pay for Coffee Take Coffee

Make CoffeeHand Coffee

To Customer

Payment

Order

cancelled

Insufficient Payment

Coffee

Order

> 5 min wait

+Done

Done

Leave

Discard Coffee

Done

Store Open

Take Order

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BPM Questions

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BPM Questions

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How do we design and communicate this process?

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BPM Questions

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How do we design and communicate this process?

How do we perform this process well?

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BPM Questions

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How do we design and communicate this process?

How do we perform this process well?

How do we manage this process well?

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BPM Questions

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How do we design and communicate this process?

How do we perform this process well?

How do we manage this process well?

How do we maintain compliance to rules and regulations?

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BPM Questions

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How do we design and communicate this process?

How do we perform this process well?

How do we manage this process well?

How do we maintain compliance to rules and regulations?

How should technology support this process?

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Types of BPM Projects

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Source: Palmer (2007)

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Types of BPM Projects

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Source: Palmer (2007)

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Scheduled Project Time during First BPM Project

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Business CaseProject Team SelectionProcess DiscoveryDocumentationFunctional and Technical SpecificationTools Evaluation and SelectionImplementationTesting and DebuggingDeployment and Training

Source: BPTrends (2006)

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

Manage Change

Manage Execution

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

NotationStandard

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

NotationStandard

Integration Standards

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

NotationStandard

Integration Standards

InteractionStandards

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

NotationStandard

Integration Standards

InteractionStandards

StandardMetrics

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BusinessProcessManagement

BusinessProcessAutomation

BusinessProcessInnovation

BusinessProcessMonitoring

NotationStandard

Integration Standards

InteractionStandards

StandardMetrics

AuditStandards

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Enterprise Process Frameworks

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BT Process Hierarchy

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Process Groupings

Business Activities

Core Processes

Business Process Flows

Detailed Process Flows

Level A

Level B

Level C

Level D

Level E

Level F

ObjectivesBusiness Activities

Delivery Units Products

Processes Systems

Scorecard

Sub Processes Roles System Functions

Operational Process Flows

Detailed Processes TransactionsDetailed Roles

Delivery Teams

Ownership ServicesProcess Groupings

Core processes

Strategic Process

Description

Tactical Process

Description

Operational Process

Description

Source: British Telecommunications plc 2006

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BT Process Hierarchy

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Process Groupings

Business Activities

Core Processes

Business Process Flows

Detailed Process Flows

Level A

Level B

Level C

Level D

Level E

Level F

ObjectivesBusiness Activities

Delivery Units Products

Processes Systems

Scorecard

Sub Processes Roles System Functions

Operational Process Flows

Detailed Processes TransactionsDetailed Roles

Delivery Teams

Ownership ServicesProcess Groupings

Core processes

Strategic Process

Description

Tactical Process

Description

Operational Process

Description

Source: British Telecommunications plc 2006

WHATWHAT

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BT Process Hierarchy

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Process Groupings

Business Activities

Core Processes

Business Process Flows

Detailed Process Flows

Level A

Level B

Level C

Level D

Level E

Level F

ObjectivesBusiness Activities

Delivery Units Products

Processes Systems

Scorecard

Sub Processes Roles System Functions

Operational Process Flows

Detailed Processes TransactionsDetailed Roles

Delivery Teams

Ownership ServicesProcess Groupings

Core processes

Strategic Process

Description

Tactical Process

Description

Operational Process

Description

Source: British Telecommunications plc 2006

WHATWHAT

HOWHOW

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ObjectivesBusiness Activities

Delivery Units Products

Processes Systems

Scorecard

Sub Processes Roles System Functions

Detailed Processes TransactionsDetailed Roles

Delivery Teams

Ownership ServicesProcess Groupings

Core processes

Top-Down Strategy

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Process Groupings

Business Activities

Core Processes

Business ProcessFlows

Detailed ProcessFlows

Level A

Level B

Level C

Level D

Level E

Level F

Operational ProcessFlows

Strategic Processes/

Rule Description

Tactical Processes/

Rule Description

Operational Processes/

Rule Description

Strategy

BPM Application

Top-Dow

n Project

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Process Architecture: BenefitsAllow to short-circuit process identification phase

Provide neutral map for navigation along processes

Standardize terminology across the enterprise

Enable benchmarking across organizations

Designed based on industry best practices

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Roles &Responsi-

bilities

Process Owners

ProcessManagers

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Process Architecture: Fortune 100Enterprise Process ArchitectureMethods Organization

Levelconcept

Conventionhandbook

Modelinghandbook

CorporateModelingService

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Architecture ContentsGlossary and Data Structures

Common terminology that Business & Systems Analysts can refer to

Business Capabilities and Process Definitions

What capabilities do you have, and what processes do you support

Senior managers and business users have a common vocabulary of processes

Software purchases or outsourcing agreements are simplified

Consistency across business partners

Library of Cross-Organizational Messages

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Example: ACORDInsurance Business is assemblage of standard process building blocks

Use for

Internal integration

Integration across distribution channels

Integration with third-party providers

“We are about the business content that goes into the process”

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Process Framework BenefitsFrameworks save time

Coloring a picture vs. drawing a picture

Frameworks reduce riskIncorporate best practices

Frameworks enable business agilityProvide business context

Frameworks reduce costsEnterprise overview helps identify areas in need of improvement

Frameworks enable incremental development

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BPM - Technical Evolution

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The Role of BPM Technology

“The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency.

The second is that automation applied to an inefficient operation will magnify the inefficiency.”

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No BPM = Monolithic Enterprise Application

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

User Interface

Program and Logic

Internal Protocols are Proprietary C, C++, Visual Basic, Etc.

Built as a unit, Internals not visible

User Interface built in for all functions

In order to “extend” to a new function, need to call in a programmer...

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BPM 1990: Workflow in the Brain

Background Check

Conform

ance Guidelines

ApplicationLogic in

MonolithicProgram

UI“Screens”

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

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BPM 1993: Task Management

backgroundcheck

createaccount

checkguidelines

LaunchesUI

User accessesoriginal UI directly

Human BPM/Workflow:

Background Check

Conform

ance Guidelines

ApplicationLogic in

MonolithicProgram

UI“Screens”

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

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BPM 1996: Workflow Routing

backgroundcheck

LaunchesUI

User accessesoriginal UI directly

Human BPM/Workflow:

Background Check

Conform

ance Guidelines

ApplicationLogic in

MonolithicProgram

UI“Screens”

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

createaccount

checkguidelines

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BPM 2002: Services Integration

EnterInformation

Background Check

Conform

ance Rules

ApplicationLogic and

SOA

ServicesInterfaces

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

Reviewrules check

backgr. check

create account

UI connects user to BPMS, not the back-end

applications

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BPM 2007: Composite Services

EnterInformation

Background C

heck

Rules

ApplicationLogic and

SOA

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

ReviewCheck Create account

ESB/BPELComposite

Service

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BPM 2007: Composite Services

EnterInformation

Background C

heck

Rules

ApplicationLogic and

SOA Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

ReviewCheck Create account

ESB/BPELComposite Services

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BPM 2007: Composite Services

EnterInformation

Background C

heck

New

Rules

ApplicationLogic and

SOA Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

ReviewCheck Create account

ESB/BPELComposite Services

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BPM 2007: Composite Services

EnterInformation

Background C

heck

New

Rules

ApplicationLogic and

SOA Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

ReviewCheck Create account

ESB/BPELComposite Services

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BPM 2007: Composite Services

EnterInformation

Background C

heck

New

Rules

ApplicationLogic and

SOA Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

ReviewCheck Create account

ESB/BPELComposite Services

ExtraAudit

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Separation of ResponsibilityBusiness Retains Control of

Assignment of ResponsibilityGroups, Roles, SkillsDeadlinesAlerts, Reminders, EscalationsOrder of TasksAddition of Manual TasksUser Interface

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IT Retains Control ofComputational LogicData RepresentationsScalability / PerformanceInteroperabilityMaster Data Management

EnterInformation

Background C

heck

New

Rules

Enterprise Application “Account Management”

listAccts

newAcct

updateAcct

deleteAcct

ReviewCheck Create account

ESB/BPEL

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BPM Governance

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Leveraging Vertical and Horizontal Expertise

Compare Sainsbury (2006)

Process Group 2

Process Group 4

Process Group 3

Process Group 1

Process Group 5

Product Line 1

Product Line 2

Product Line 3

Product Line 4

Product Line 5

Process Manager

Process Manager

Process Manager

Process Manager

Process Manager

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Process OwnershipSource: Sainsbury (2006)

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Focus Role Objective

BPM Roles - Example

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Process Sponsor

Process Framework Executive

Process Executive

Process Owner

Process Manager(recommended)

Process DB Manager

Process Modeler

Strategic

Operational

SharedService

Responsible for ARIS

Modeling Processes

Implement & Optimize

Process Performance Management

Standardize & Optimize

Facilitate & Drive

Method & Compatibility

Level

Corp. Region Division

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The BPM Maturity Model

Governance Method IT People CultureStrategic Alignment

Process Roles and Responsibilities

Process Design & Modeling

Process Skills & Expertise

Process Values & Beliefs

Process Improvement Plan

Decision Making Processes

Process Implementation &

Executions

Process Education & Learning

Process Attitudes & Behaviors

Strategy & Process Capability Linkage

Process Management

Standards

Process Improvement &

Innovation

Process Knowledge

Leadership Attention to

ProcessProcess Output Measurement

Process Metrics & Performance

Linkage

Process Control & Measurement

Process Collaboration & Communication

Responsiveness to Process Change

Process Architecture

Process Management

Controls

Process Project & Program

Management

Process Management

Leaders

Process Social Networks

Process Customers & Stakeholders

Business Process Management Maturity

Process Design & Modeling

Process Implementation &

Executions

Process Improvement &

Innovation

Process Control & Measurement

Process Project & Program

Management

Source: Rosemann & DeBruin 2006

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Agile BPM MaturitySatisfying all 30 facets of the BPM Maturity Model takes a long time

A subset of the BPM Maturity model is needed to guide an organization toward a rapid deployment of BPM technology

Example: Staged Deployment of Maturity Initiatives

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Modeling Tool Extended use of Tool

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Choosing the Right StrategyThere is no single right pathway for all organizations

If command-and-control infrastructure: Methods come first, culture comes later

If participatory organization: Culture and people need to be nurtured earlier in the process

If centralized organization: Building a central repository can be undertaken early in the process

If decentralized organization: Leveraging individual projects to facilitate quick wins is important, but an integration strategy for the project results later on needs to be instituted early on

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3 Challenges Ahead

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50 Years of IT Lock-Down

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Management by Magazine

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Business People Acquiring IT Skills

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Thank You – Questions?

Michael zur Muehlen, Ph.D.Howe School of Technology ManagementStevens Institute of TechnologyCastle Point on the HudsonHoboken, NJ 07030Phone: +1 (201) 216-8293Fax: +1 (201) 216-5385E-mail: [email protected]: http://www.cebpi.org

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