Prof. Dr. Hans-Jürgen Scheruhn | Business Process Management (BPM) Automatisierung und Informatik...

Prof. Dr. Hans-Jürgen Scheruhn | Business Process Management (BPM)

Automatisierung und Informatik

Hochschule Harz | Wernigerode 18.10.2010

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Prof. Dr. Hans-Jürgen Scheruhn http://hscheruhn.hs-harz.de

Hochschule Harz Wernigerode

Hochschule für angewandte Wissenschaften (FH)

Business Process Management (BPM)

Vorlesung im Wintersemester 2010/11 an der Leuphana-Universität




COMPANIES´ TOP GOALS FOR BPM

4,48

4,95

4,98

5,04

5,04

5,09

5,53

5,57

5,58

5,68

5,79

5,81

1 2 3 4 5 6 7

Improving the quality of your business processes

Improving customer satisfaction

Continuous process Improvement

Reducing costs

Improving the customer experience

Improving business agility

Transforming your business

Improving IT department's ability to make changes to systemsunderlying business processes

Automating a particular process for the first time

Empowering business users to make certain changes to processes andunderlying solutions

Modernizing existing solutions using BPM and Service-OrientedArchitecture (SOA)

Implementing a particular pre-built solution based on BPM technology

Not

Important

Extremely

Important

Source: --Michelle Cantara, Gartner, Market Trends: Impact of Business Process Management on Consulting and Development & Integration Services, Worldwide, 2008-2010




Since process models have become embedded in the BPM approach, the idea of a reference model or best-practice has emerged into BPM. Reference models can be thought of as templates from which process models may be developed. Reference models are often developed by associations of professionals. Therefore they are quite knowledge intensive. Examples of reference models include the APQC Process Classification Framework (PCF), the Information Technology Infrastructure Library (ITIL), or the Supply Chain Operations Reference model (SCOR).

The Concept of Reference Models




Process Hierarchy

ActivityActivity

MainMainProcessProcess

ProcessProcess

ProcessProcessAreaArea

Level 1Level 1

Level 2Level 2

Level 3Level 3

Level 4Level 4

Extendenterprise map




Business Process Description – As-Is Documentation

Process steps

Involved Business Units

Businessobjects Business rules

R: Responsible; person who carries out the activityA: Accountable; person who is in chargeC: Consulted; person asked before carrying out the

activity or supporting the activityI: Informed; person has to be informed




666

Präsentation

Prozesse

Daten

Benutzer-Rollen einnehmen und

Prozesse via SAP GUI bedienen :

Prozesse ausführen : Ablauf der gesamten Fallstudie

Einzelne Fallstudien-Abläufe

Transaktion ausführen :Alle Fallstudieninhalte auf einen Blick

Daten ein- / ausgeben :Vollständiger SAP-Beleg- / Geldfluss

Beschreibung SAP-Maskeninhalte

Alle SAP Ein- / Ausgabedaten

Alle SAP-Systemorganisationseinheiten

Kunde

Anfrage

Angebot

Kundenauftrag

Organisationssicht

(OrgEinheiten / Planstellen / Rollen/ User) :

Abstraktionsebene 1 bis 3

ProzesssichtWertschöpfungskette : Ebene 1 und 2

Ereignisgesteuerte Prozesskette : Eb. 3

DatensichtInformationsträgerdiagramm : Ebene 3

Maskendiagramm : Abstraktionsebene 4

Entity Relationship Diagramm : Ebene 3

Organigramm : Abstraktionsebene 1- 3

FunktionssichtFunktionsbaum : Ebene 1 bis 3

Funktionen

RolleProcess-Owner

Ausführung SAP ERP Abbildung als Modell in ARIS (Ausschnitt)

Darstellung 4 IT-Integrationsebenen am Bsp. Fallstudie SSB




7

BusinessSilos

StandardizedTechnology

OptimizedCore

BusinessModularity

DynamicVenturing

IT capability

Local IT applications

Shared technical platforms

Companywide standardized processes or databases

Plug-and-play business process modules

Seamless merging with partners’ systems

Businessobjectives

ROI of local business initiatives

Reduced IT cost Cost and quality of business operations

Speed to market; strategic agility

ROI of new business ventures

Who defines applications

Local business leaders

IT and business unit leaders

Senior management and process leaders

IT, business, and industry leaders

IT, business, and industry leaders and partners

Strategic implications

Local/functional optimization

IT efficiency Business/operational efficiency

Strategic agility Organic reconfiguration

Source: Ross et. al, 2006

Architecture Maturity have change to Business Modularity – A Brief history of Architecture Maturity




Business Agility

Business Process Reengineering

Enterprise Resource Planning

Operational Efficiency

Business Network Transformation

Business Process Platform

1990s 2000s 2010s

+

From Operational Efficiency to Business Agility

Source: Adapted from the book: Business Process Management – The SAP Roadmap, 2009) Source: Adapted from the book: Business Process Management – The SAP Roadmap, 2009)




Enterprise Architecture

An enterprise architecture (EA) describes the structure of an enterprise, its decomposition into subsystems, the relationships between the subsystems, the relationships with the external environment, the terminology to use, and the guiding principles for the design and evolution of an enterprise.

An enterprise architecture provides a holistic, systematic description of an enterprise. It encompasses business functions, business process, people, organisation, business information, software applications and computer systems with their relationships to enterprise goals. The hope for enterprise architecture is that applying systematic rational methods to the design of an enterprise will produce one that more effectively and efficiently pursues its purposes.

Enterprise architecture models the organization’s core mission, each component critical to performing that mission, and how each of these components is interrelated. These components include: guiding principles, organization structure, business processes, people or stakeholders, applications, data, infrastructure, and other technologies.




Business Model

A business model describes the rationale of how an organization creates, delivers, and captures value - economic, social, or other forms of value. The process of business model design is part of business strategy.

In theory and practice the term business model is used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, offerings, strategies, infrastructure, organizational structures, trading practices, and operational processes and policies.




Business Model Management – Green BMM

"Green" business model management (BMM) describes the process of development of how new and/or existing business models can adapt and realign to become more environmentally sustainable and socially responsible.

Source:Scheel, H., von Rosing, M., SAP Sustainability, 2010Source:Scheel, H., von Rosing, M., SAP Sustainability, 2010




Process Evolution - Business Process Modeling




Business Model Governance Business model governance is the set of purpose, offerings, strategies, infrastructure,

organizational structures, trading practices, and operational processes and policies affecting the way a business model is directed, administered or controlled.

Source: Applying Real-World BPM in an SAP Environment, 2010Source: Applying Real-World BPM in an SAP Environment, 2010




The SAP BPM Governance Framework

Source: BPM Governance (Adapted from the book: Business Process Management – The SAP Roadmap, 2009)Source: BPM Governance (Adapted from the book: Business Process Management – The SAP Roadmap, 2009)




Business Process Management (BPM) Definition

Business Process Management (BPM) is a management discipline that requires

organizations to shift to process-centric thinking, and to reduce their reliance on traditional

territorial and functional structures.

BPM requires and enables organizations to manage the complete revision cycles of their

processes, from process design to monitoring and optimization, and to change them more

frequently to adjust to changing circumstances.

The development of BPM technologies is enabling business managers to abstract process

flows and rules from the underlying applications and infrastructure, and to change them

directly.

BPM is neither a technology nor an updated version of BPR. It is an IT-enabled

management discipline. It represents a fundamental change in how business manage and

run their processes

Source: Adapted from the book: Business Process Management – The SAP Roadmap, 2009 Source: Adapted from the book: Business Process Management – The SAP Roadmap, 2009




SAP Governance Modeling Activities in BPM

Source: Applying Real-World BPM in an SAP Environment, 2010Source: Applying Real-World BPM in an SAP Environment, 2010




Governance: process parameters : http://wiki.sdn.sap.com/wiki/x/3wh8C

Process Owner

Who is responsible for the process?

Managers with end-to-end responsibility for individual processes

Organizational Units

Which organizational units own the process execution?

Processes are performed by one or more organizational units.

Examples: Business department, HR, Controlling

Objects

Which objects

are used, modified, and produced?

Processes result in the manipulation of physical or informational objects. The two most important objects are input and output.

Examples: purchase order (PO), invoice

KPIs/PPis

How is the process performance measured?

Definition of measurable indicators to verify whether the process goals have been achieved

Examples: # of created POs, process cycle time

Roles

Which roles need to contribute to the process execution?

Definition of all resources involved in performing the process

Examples: hiring manager, recruiter, HR Business Partner

Business Rules

Which rules govern the business?

Description of the operational characteristics of the business

Example: Prioritization guidelines, disturbances, decision processes

Technology

What kind of technology enables the process execution?

Systems, tools, and hardware used

Example: mySAP SRM

Media

By which media do processes interact?

Means of communication used

Examples: paper, fax, e-mail

Process Flow

Which processes precede and follow?

Definition of process sequence and process interfaces, input and output

Example: receive PO, check availability, confirm delivery date

Process

Purpose & Goal

Why is the process performed?

Ultimate reason for the existence of the process

Example: Getting the right products to the right person at the right time based on existing orders




1818

Process Phases / Portals of OPM

1.Strategic-planning

5. Process- controlling

2. Process- Design

3.Implemen-tation

EnterpriseArchitect

Portal

Controller Portal

Balanced Scorecard

Intra Company Process Integration /SAP Business Workflow / SAP NetWeaver BI /SAP SolMan

Modelling As-Isand To-Be Status ARIS / SAP SolComp.

Integration Portal

4.Process-execution

Customer / Employee PortalIntra Company

Process Control /SAP Business Workflow

Management Portal

Intra Company Process Monitoring /SAP Business Workflow & SAP Netweaver BI

Process Portals not active in this Presentation !




The Process Maturity Journey

• New Functionality • Business responsiveness• Change business

process quickly and effectively

• Business optimization• Increase decision quality• Optimization across

boarders of Bus.& IT

• Transformation from reactive to real-time

• Increase Transparency

• IT cost reduction and control

• Reduce time-to-market• Documented processes

A culture of heroes

Processes are improved at the work group or department level

Processes are organized and redesigned at the enterprise level

Processes are measured and managed systematically

Process Teams continuously improve processes

No organized processes

Level 1 Some organized processes

Level 2 Most Processes Organized

Level 3 Processes are managed

Level 4 Processes are continuously improved

Level 5

Transformation Need

Proce

ss M

aturity




To BeDesign

Process OwnerProcess ArchitectBusiness Architect

CIOEnterprise ArchitectApplication Consultant

Project ManagerProgram/Portfolio Manager

Business Unit OwnerBusiness ArchitectBusiness Analyst

SAP Solution Manager supports 4 lifecycles




Link with SAP Solution Manager / Solution Composer

Business ModelLevel 1

Business ModelLevel 2

Process Level 1

Process Level 2

Process Level 3

Process Level 4

SAP Solution Manager



SAP system




Link between Business Model and SAP Solution Manager

Scenario

Process

ProcessStep

GoodsReceipt

Processing

SAP function type: Process

GoodsMovement


Scenario

GoodsWarehousing


GoodsReceiptPosting


PostGoodsReceipt

GoodsReceipt

Processed

SendGoods

AddGoods to

Warehouse

CheckInventory

GoodsReceived

OrderReceived

Inventory Management

Warehousechecked

InventoryManagement

Goodsadded to

Warehouse

FinancialManagement

ProcurementSales &

DistributionManagement

MaterialRequirements

Planning

Sales &DistributionManagement

Check Order

OrderChecked

ProcessGoods Receipt Processing (EPC)

ReceivePurchased

Goods

ReceiveShipping

NotificationSAP function type: Process step

DifferenceProcessing

Perform ReturnDelivery

Perform StockTransfer

Confirm TransferOrder

Create TransferOrder

GoodsReceipt

Processed

GoodsReceived

GoodsMovement


GoodsReceiptPosting


ReturnGoods

UnpackGoods

CheckGoods

Goods OKGoods

Different toNotification

Goods notOK

DifferencesCorrected

StartCheck

Inventory

EndCheck

Inventory

VL75 (Shipping Notification Output)

ShippingNotification

Output

ReceiveShipping

Notification

SAP function type: Process stepSAP component: SAP R/3

ME308 (Send Contracts with Conditions)

SendContracts with

Conditions

SAP R/3

Process step

Receive Shipping Notification

InventoryManager

SAP SRMNetweawerSAP ERP SAP SCM SAP PLMSAP CRM

Prof. Dr. Hans-Jürgen Scheruhn | Struktur B2B mit SAP ERP



Business Model Management Definition

The business model is simply a working description that includes the general details about the

operations of a business. As part of the business model, there is a need to address internal factors

that relate to the ongoing operation of the company. The competencies that are contained within the

business model will address functions, purpose, offerings and services, including such factors as: Corporate structure, infrastructure & responsible The main business goals, e.g. strategic business objectives, critical success factors and

key performance indicators Business Issues/pain points Core and None core Value creation and realization Financial indicators: Revenues and Cost

Working with once business model helps a company to maintain focus on a core competitiveness

and core differentiation, while keeping a comparative advantage with the none core competencies.

Periodic reviews and updates help to keep the business model relevant to current competition,

market changes, economic conditions and consumer demands. Generally speaking, the most that

has to do with the strategic decisions and operation of the corporation can be said to be part of

business model management.

Source: Applying Real-World BPM in an SAP Environment, 2010




Performance Measurements in connection with BMM & BPM




Determining Process PerformanceProcess Performance can only be measured if appropriate Performance Indicators are identified

Clarify process scope (e.g. define start- and end-point of all involved processes, interfaces to other processes / work-streams)

Identify and define adequate Process Performance Indicators (PPIs)

Determine to-be values of PPIs, consider benchmarks as far as possible

Evaluate measurement of as-is values of PPIs (e.g. read timestamps in systems)

Record cycle time of all involved sub-processes (complete coverage of process chain)

Prerequisites for Process Performance Measurement

Costs Time

Quality

TRADE-OFF !

Volume Efficiency

Process Performance Dimensions

How can the end-to-end cycle time be measured?

Are process interfaces aligned?

What is the to-be cycle time? Are there any benchmarks /best-in-class values?

Time How is the

process quality measured?

Which quality is aimed for?

Quality How can costs be

allocated directly or indirectly to the process (labor costs, costs for infrastructure,…)

Costs

Which volume does the process need to handle? (e.g. # of orders)

Are these items counted?

Volume How can process

efficiency be measured (e.g. conversion ratios)?

Which efficiency is aimed for?

Efficiency

Prof. Dr. Hans-Jürgen Scheruhn | Business Process Management (BPM) Automatisierung und Informatik...

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