A business process consists of a set of coordinated activities that accomplish a particular business goal. The order of these activities and the efficiency of those who perform the activities determine the overall performance of a business process.
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A business process is a set of coordinated activities that are performed either by humans or by tools with the objective to realize a certain business result.
In today's competitive market, the efficiency of a company is a key criterion for success because, in addition to innovation, operating efficiency is key to improving the company's competitive advantage in the market. Knowing and understanding the details of business processes is therefore highly important because this gives us the opportunity to identify the bottlenecks and optimize business processes. Having highly-optimized business processes is one of the most important priorities of companies.
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Optimized business processes are increasingly important for companies as they provide the company with a competitive advantage. With BPM/SOA, companies can optimize business processes easily, with less effort, and in a shorter time than with previous approaches.
However, it's not only the competitive advantage that matters; companies also need to react to changes in the global market, to new opportunities, and to threats from other companies. They react with modifications to their business processes.
Optimizing business processes is also related to information systems. Each change in the process requires changes in the related application systems.
BPM is not only about performance improvement and adaptability. It is also about change management. BPM can help to improve organizational procedures and rules and can adhere to industry standard compliance and legal compliance.
We can get a complete understanding of a business process only when we look at the details. It's in these details that the complexity hides. We can model business processes in a variety of visual languages; the most widely used is BPMN. Until now, event process chain (EPC), extended event process chain (eEPC), UML activity diagrams, and others, such as flow charts, have been used. As we will see throughout this book, today's modeling tools, such as Oracle BPM Suite, provide comprehensive support for BPMN modeling. However, it is not enough to just model a process, it is also important to adhere to best practices, which we will explain in this book.
We use business process models to understand the processes. This gives us the opportunity to improve and optimize them. Business process optimization and re-engineering are very important, and it is up to our imagination to improve processes, integrate them to gain synergic benefits, and use other approaches to optimize them. Business process optimization is related to several important topics that should not be overlooked. We will mention just three here:
Changing business processes requires changing the way people work. And people do not like change. Therefore, in order to be successful, we need to be careful about how we apply the changes to the real world and how we motivate the employees to change their way of working. Otherwise, even a theoretical process that is highly optimized will not work in the real world.
Changing business processes does not mean changing only the behavior of the employees but requires changing the IT support and related application systems. This topic is of particular interest to us, and we will look at it in detail in the next section.
Finally, changing the business processes only once is not the key to long-lasting success. If a company wants to have long-lasting success, it should develop an environment where business processes can be continuously optimized. This is a particularly difficult task because continuous change in business processes also requires continuous change in the way employees work and in the way IT supports the business.
Often, business processes are classified into internal or private business processes and public or global business processes. Internal business processes are related to a single company. Internal processes can be local to a single organizational unit, department, or line of business, or they can span multiple units, departments, or LOBs. Public business processes, on the other hand, connect two or more companies.
Business processes are often classified as operational processes, management processes, and supporting processes. Operational processes represent the core business and are, therefore, the most important. For example, a marketing company that manages advertisement boards relies on efficient processes that start with an order for advertising and end when the advertisement is published on boards throughout the country or abroad. The faster the company can realize the orders and the faster it can react to new requirements from customers, the better it is.
Management processes are responsible for managing and governing the enterprise. Supporting processes are those processes that support the core operational processes, such as support, accounting, and so on, and are usually found in the majority of companies.
Business processes, particularly operational and management processes, are always specific to a company. Companies, therefore, cannot buy IT support for these processes in the market but have to custom develop it to address their specific needs.
In some industries, best practices related to business processes have been gathered and published. In the telecommunication sector, a well-known business process framework is the enhanced telecom operations map (eTOM). eTOM defines the best process frameworks for different aspects related to telecommunication business, such as service configuration and activation, resource management and operations, resource provisioning, and so on. Other examples include the APQC process classification framework (PCF), 8 Omega, and so on.
Such business process frameworks can be used for various reasons, including:
To standardize business processes in an industry
To ease integration between different companies from the same industry/sector
To use them as benchmarks to compare our own processes
To follow and improve our processes
Some experts are of the opinion that best practices represent the average state in the industry. If our company is benefiting from such processes, it means that our processes are no better than average. Usually, companies that are above average keep their business processes confidential because they know that their business processes reflect their true competitive advantage.
Caring about business processes is not only about improving existing processes. It is also about creating new business processes that address new digital channels and business models enabled by the digital economy. Such processes can be directed towards consumers and facilitate digital channels, such as social networks. They can also be directed towards B2B integrations. Either way, often such processes rely heavily on services and their application programming interfaces (APIs) for integration. The API management and the API economy are therefore becoming increasingly important for modern process-driven architectures.
The second important aspect is knowledge-driven processes, which exist for several activities that do not follow an exact order or always the same order. Such processes cannot be easily modeled with traditional modeling languages, such as BPMN. Therefore, adaptive case management approaches have emerged, providing the opportunity for companies to address these knowledge-intensive processes as well in a structured manner. We will talk about ACM in Chapter 9, Adaptive Case Management, of this book.
Understanding the business is not only about individual business processes. It is also important to understand how business processes at different levels fit together and how they relate to the strategy, business model, products, services, and other aspects of an enterprise.
Business processes can be at different levels of decomposition. Top-level processes represent a high-level, bird's-eye view of an enterprise, business model, and strategy. On lower levels, business processes become more detailed.
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Therefore, it is important to understand that BPM is not about individual business processes only, but also about the overall business architecture.
Business processes can be structured into levels. Usually, we talk about four levels of decomposition:
On the top level, we model process areas or business functions.
On level two, we model process categories, which are often organized around value chains.
On level three, we model business processes from the business perspective. As already mentioned, we often use BPMN for this step.
On level four, we model processes for implementation. We talk about automated processes and decomposition of process elements. Here, we can use executable BPMN 2 or BPEL or a combination of both.
Business processes is, however, only a part of the business architecture. The other important parts are business information, governance structure, and the overall structure of the enterprise. According to the Object Management Group (OMG): the BA is a blueprint of the enterprise that provides a common understanding of the organization and is used to align strategic objectives and tactical demands.
The BA addresses organization, capabilities, information, and value chains. It also addresses products and services, stakeholders, vision, strategy and tactics, projects, decisions and rules, metrics, measures and key performance indicators, policies, and rules and regulations. The various aspects of the BA are shown in the following figure:
Figure 1: Business architecture aspects
Modeling the BA has traditionally not been integrated with business process modeling. However, in Oracle BPM Suite 12c, a lightweight BA modeling tool has been introduced. As modeling the BA is intended for business people, this tool is part of the web-based business process composer. It introduces the following:
The enterprise process map is used for defining high-level business functions. This addresses the high-level decomposition, allows the identification business functions, and hierarchically orders them.
The value chain model is used to decompose each business function into a value chain. A value chain can be further drilled down into child value chains or into concrete business processes represented by BPMN models.
The strategy model is used for representing the relationship between BA artifacts. It encapsulates organization business goals, objectives, and metrics using strategy models.
Key performance indicators can also be captured within BA and represent key success metrics.
We will talk more about BA modeling using BPM Suite in Chapter 2, Modeling Business Processes for SOA – Methodology. It is, however, important to stress that integrating BA modeling with business process modeling is very important for reducing the semantic gap.
Business architecture is usually conducted as a part of the greater enterprise architecture. It is a common misperception that the EA is only about technological aspects.
Enterprise architecture is the high-level design of an organization, which includes the business architecture (business processes, organization, and people), application architecture (services, components, and applications), data architecture (data and information and data models), and IT infrastructure (software, hardware, network, and so on).
The EA applies architecture principles and sound practices to design business, information, process, and technology architectures necessary for companies to execute their strategies. The enterprise architecture is designed with these objectives: to improve manageability, effectiveness, efficiency, and agility of the business and their processes.
Today, it is believed that the enterprise architecture is the key to controlled improvement and the increased ability of organizations to change. These changes include the following:
Improvement, integration, and standardization of business processes
Innovation in the processes and organization
Quality improvement and timeliness of business information
Several methodologies for the EA exist. The most popular are the following:
The Zachman Framework™ for enterprise architectures (http://www.zachman.com/)
The Open Group Architectural Framework (TOGAF) (http://www.opengroup.org/togaf/)
Federal Enterprise Architecture (FEA) (http://www.whitehouse.gov/omb/e-gov/fea)
The Gartner methodology (http://www.gartner.com/technology/consulting/enterprise-architecture.jsp)
Enterprise architecture can help to choose the right architectural decisions for BPM (such as mapping to services, applications, using the right data models, and so on). It can enable reuse and make the delivery of new solutions quicker, more efficient, and better aligned with the organizational strategy. It can enable and foster governance.
In the future, the EA will tightly integrate with tools for modeling the BA and business processes and will become the top-layer modeling tool for each enterprise.