INFS3604 Cram Review - Lecture Notes 1-10 PDF

lOMoARcPSD|3204891 INFS3604 Cram Review - Lecture notes 1-10 Business Process Management (University of New South Wales) StuDocu is not sponsored or endorsed by any college or university Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Week 1. Introduction Business process:...

lOMoARcPSD|3204891 INFS3604 Cram Review - Lecture notes 1-10 Business Process Management (University of New South Wales) StuDocu is not sponsored or endorsed by any college or university Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Week 1. Introduction Business process: complete end-to-end set of activities that provide value Elements of: - Event: things that automatically happen, triggers processes - Activity: set of tasks that are triggered by event - Decision point: gateway - Actor: human entities, organisations or systems - Physical object - Immaterial object - Outcome - Customer: actor who consumes the process Types of business processes - Order to cash - Quote to order - Procure to pay - Issue to resolution - Application to approval Business process management: body of methods, techniques and tools to identify, discover, analyse, redesign, implement and monitor business processes BPM life-cycle Business process reengineering: fundamental rethinking and radical redesign of business processes - Demise of BPR o Concept misuse: even when processes weren’t involved, they were classified as BPR. Eg: downsizing o Over-radicalism: changing too much too quickly, some situations require more incremental approach o Support immaturity: infrastructure and environment did not support Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Week 2. Process Identification Process identification: systematically defining business processes and establishing criteria to select processes for improvement - Balance scorecard: casual relationships between different goals - Process architecture: serves as a framework for defining priorities and scope of projects, structural dependencies between different perspectives o Organisational perspective: actors, roles and organisational structure o Product perspective: products and services along with their relationship o Data perspective: informational entities and their relationships o Application perspective: different software and their dependencies o Technical perspective: computer hardware and networks Process checklist: - Is it a process at all? à verb + noun - Can the process be controlled? à has sense of repetition - Is the process important enough to manage? à value add for stakeholders - Is the scope of the project not too big? à 1:1 relation for initial event and activities - Is the scope of the project not too small? à 3 Process categories: 1. Core processes: covers essential value creation of company 2. Support processes: enables execution of core processes 3. Management processes: provides direction, rules and practices for core and support Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Relationships between processes 1. Sequence: logical horizontal relationship between processes 2. Decomposition: one specific process is described through sub-processes 3. Specialisation: several variants of a generic process exist Defining process landscape model 1 Clarify terminology 2 Identify end-to-end processes 3 For each end-to-end process, identify its sequential processes For each business process, identify major management and support processes Decompose and specialise business processes Compile process profile 4 5 6 7 Check completeness and consistency Define key terms, use reference models, ensure stakeholders have consistent understanding of process model Which processes interface with customer and suppliers Identify internal, immediate outcomes of end-toend process What is required to execute previously identified processes Should decompose until process can be managed autonomously by single process owner Each process supports definition of boundaries, vision, resources, etc Compare to reference models Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Process selection: 3 selection criteria 1 Strategic importance Assessing the strategic relevance of each process - Highest impact on goals - Profitability, uniqueness, competitive adv 2 Health Aims to render high level of judgement of the health of each process - Which processes in deepest trouble and may benefit the most 3 Feasibility Determining how susceptible it is to BPM initiatives - Culture and politics may be obstacles Week 3 + 4. Process Modelling Performance measures 1. Time - Processing time (service time) - Waiting time (queueing time) 2. Cost - Fixed cost - Variable cost - Operational cost 3. Quality - External quality (customer satisfaction) - Internal quality (process participant view) 4. Flexibility - Ability to react to change - Runtime and buildtime flexibility Three guidelines for modelling - Accuracy: the model correctly represents the elements of the process and their relationships - Completeness: model includes all elements of process and relationships - Understandability: model is accurate and complete whilst adhering to BPMN Event Something that happens instantaneously An event (or trigger) initiates a process Task Units of work that has a duration Flow All elements are connected by an ark which denotes flow Gateway Elements that are conditions or decision points, creates pathways Token Represents an instance of process Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 3 types of trigger events 1. Action event: person or an organisation decides to do something 2. Temporal event: predetermined date or time is reached and process must begin 3. Condition or rule: process triggered by a condition Loop: repetition of task or subprocess Multi instance activity: provides mechanism to indicate activity is executed multiple times Message events Temporal events Racing events (event-based): - XOR splits can be chosen on conditions that evaluate over available data Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Process abortion - Notifies that there is an exception and terminates process, wipes of all tokens Handling exceptions Week 5. Process discovery Process discovery is achieved through techniques such as mapping, interviewing, simulations Process enablers: - - - - - Workflow design o Work plan for responding to a triggering event. Shows sequence of steps, decisions and handoffs carried out by process actors between initial event and final result Information systems o The use of IS to enable processes Motivation and measurement o Explicit and implicit rewards of the organisation, how people and processes are measured and assessed Human resources o Knowledge, skills and experience of the workforce including recruitment, training and assignment Policies and rules o Business rules enforced by process and external rules set by laws and regulatory bodies Facilities o Workplace design and infrastructure including equipment, furnishing, machinery, etc Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 When to perform process discovery 1. Continuous monitoring: BPM is concerned with continuous improvement by measuring regularly and against consistent performance metrics 2. Event triggered discovery: strategic planning, performance issues, new technologies, start-up ventures, M&A, regulatory requirements Steps of quality assurance for process discovery - Syntactic quality (how closely does it adhere to rules) o Conformance of a process model to the syntactic rules of the modelling language used o Structurally correct: § Element-level rules: all elements must have proper logic § Model-level rules: model must flow logically o Behaviourally correct: § Option to complete: all running instances must eventually complete • Example: livelock (loop, no option to complete) § Proper completion: all tokens must be at end events upon completion § No dead activities: any activity can be executed - Semantic quality (how does it compare to real world) o Validation: adherence of model to real world process o Completeness: all possible process instances are covered - Pragmatic quality (usability of the model) o Usability: § Understandability: how easy it is to read and understand § Maintainability: how easy it is to apply changes § Learning: how good it reveals corresponding process works in reality 7PMG 1. 2. 3. 4. 5. 6. 7. Use as few elements in model as possible Minimise routing paths per element Use one start event (per trigger) and one end event (per customer) Model as structured as possible Avoid OR gateways where possible Use verb-object activity labels Decompose a model with more than 30 elements Process analyst vs Domain expert - Process analysts have knowledge of modelling conventions but no contextual knowledge - Domain experts understand instance level but not modelling Discovery challenges: - Fragmented process knowledge o Only have knowledge on their interactions with the process Domain experts think on instance level o Only considers specific cases rather than rainy day or extreme cases Knowledge of process modelling is uncommon Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Discovery methods: - Evidence based o Document analysis § Issues: may not be process-oriented and trustworthy, may require abstraction or refinement o Observation § Follow directive execution of process • Active role: play a specific role (eg: customer) → no bigger picture • Passive role: observe participants in their environment → bias o Automation process discovery § Done through data mining - Interview based o Forward vs Backward o Structured vs unstructured - Workshop based o Facilitator, participants interacting to create shared understanding o Culture: § Open culture: workshops help free discussion § Hierarchical culture: opinions might be held back, role of facilitator to distribute equal share of parole Week 6. Qualitative Process Analysis Process modelling method: - Stepwise method 1. Identify process boundaries 2. Identify activities and events 3. Identify resources and handovers 4. Identify control flow 5. Identify additional elements Value-add Analysis 1. Decompose the process into steps - Steps performed before a task - The task itself, decomposed into smaller steps - Steps performed after task 2. Identify the customer and identify positive outcomes of the process 3. Classify each step - Value-adding - Business-value add - Non-value adding Value add: produces value for customer - Customer is willing to pay for step - Steps help achieve customer goals - If step is removed, customer perceives end product to be less valuable Business value add: necessary or useful for business to operate - Step is required to collect revenue or improve/grow business - Business suffers in long term if step is removed - Step is required to comply with regulatory Non value adding: (everything else) - Eg: handovers, waiting times, rework or defect correction Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 VA Analysis in form of: Step Performer Classification (VA/NVA/BVA) Waste analysis - Seven sources of waste Move: wastes related to movement - Unnecessary Transportation: moving materials from one location to another, eg: from warehouse to production facility o Often signals a handoff, leading to delay waste o Typically occurs when sequence flows change lanes - Motion: process participants moving from one place to another during execution of process o Movement of resources or when participant must change applications digitally Hold: wastes arising from holding something - Inventory: more than required inventory is held at given time to maintain production lines o Inventory waste shows up as WIP à cases that have started and not yet completed, therefore unrealise value - Waiting: when a task waits for a process participant to become available o Idleness: resource waiting for work’ o Transportation often implies waiting waste as person picking up isn’t available Over-do: arising from doing more than is necessary in order to delivery value to customer - Defects: all work performed in order to correct, repair or compensate for defects o Encompasses rework meaning the task must be completed again - Over-processing: work performed unnecessarily given outcome of a process instance o Includes perfectionism but also tasks performed then later found to be unnecessary - Over-production: occurs when execute entire instance that does not hold value upon completion o When there is foresight that instance is not necessary Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Identifying and documenting process issues - Three techniques: o Stakeholder analysis: used to gather information about issues that affect performance of process from different perspectives (Customers, process participants, external parties, managers) o Issue register: listing that provides detailed analysis of each issue in form of table (ID, name, description, assumptions, qual, quant, improvements) Pareto analysis: aims to identify which issues should be given priority o Pick chart: considers priority but also measures difficulty against payoff for implementation of solutions Root Cause Analysis - 6Ms à fishbone diagram o Machine: factors stemming from technology used, poor UI, lack of integration between systems o Method: stemming from way process is designed, understood or performed à eg: unclear instructions, insufficient training o Material: factors stemming from input materials or data à missing or incorrect data o Man: factors stemming from wrong assessments or incorrect performance of steps à eg: lack of motivation o Measurement: factors stemming from reliance on inaccurate estimations or miscalculations o Milieu: factors outside of scope of business Week 7. Quantitative Process Analysis Flow analysis: uses techniques to estimate overall performance of a process given some knowledge - Average cycle time - Average cost - Error rate Cycle time: average time between moment process starts and ends 1. Cycle time of a sequential fragment Cycle Time CT = 2. Cycle time between XOR splits and joins = Cycle Time CT T Downloaded by Varun Amin ([email protected]) f k lOMoARcPSD|3204891 3. Cycle time for parallel events CT = Cycle Time T = set of tasks Cycle time efficiency Cycle time can be divided into - Waiting time: portion of cycle time where no work is being done - Processing time: time that participants spend on actual work CTE = Cycle Time Efficiency TCT = Theoretical Cycle Time CT = Cycle Time Cycle time efficiency (CTE): the ratio of overall processing time relative to cycle time. The lower the number, the more improvement that could be made Cycle time (CT): calculated using previous equations Theoretical cycle time (TCT): calculated using same equations, but with processing time instead of cycle time Week 8. Process redesign Two motivations for process redesign: 1. Positive impetus of organisations to innovate 2. Negative phenomenon of organisational entropy Differentiation between product innovation and process innovation - Product innovation: concerned with development of new products or new features - Process innovation: redesigning business features to create value Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 - It is natural for firms that initial emphasis on product innovation is followed by focus on process innovation, “second wave of innovation: Organisational entropy: all businesses evolve over time, growing more complex and leading to decreased performance over time Redesign elements to consider: - Internal or external customers - Business process operation view: how a business process is implemented - Business process behaviour view: how a process is executed - Organisation and the participants in the business process: captured at two levels (organisational structure: roles, users, groups, departments) and organisation population (individual agents and relationships between them) - Information that business process uses or creates - Technology used - External environment its situated in Devil’s Quadrangle - Time: improve average time, improve consistency - Cost: per time unit, per use, aim is to always decrease - Quality: improve quality, less defects - Flexibility: ability to react to changes Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Redesign Orbit Process Design Heuristics Heuristics: 1. 2. 3. 4. 5. 6. 7. 8. Parallelism: put activities in parallel Case-based work: remove batch-processing and periodic activities Activity elimination: eliminate unnecessary activities Empower: give workers decision-making authority Triage: split an activity into alternative versions Case assignment: let participants perform as many steps as possible Flexible assignment: keep generic participants free for as long as possible Centralization: let geographically dispersed resources act as if they are centralized Transformation Method of Business Process Reengineering - Objective is to completely overhaul the process, - Analytical as it relies on clearly defined principles - Inward looking, operates within scope and context of existing process it aims to overhaul Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Week 9. Systems that work with automated business processes are called Process-Aware Information Process Systems (PAIS) automation and implementation Business Process Management Systems: a system that supports the design, analysis, execution and monitoring of business processes - Groupware systems: allows users to directly communicate with each other and share documents and information Ad-hoc workflow systems: allows creation of workflows, allows on-the-fly definitions to be created and modified Case management systems: supports processes that are neither tightly nor completely specified Production workflow systems: most prominent type of BPMS, work is ruted strictly on basis of process models. Two types: administration BPMS (manual) and transaction processing BPMS (automated) Downloaded by Varun Amin ([email protected]) lOMoARcPSD|3204891 Advantages of introducing a BPMS 1. Workload reduction - Less coordination, less gathering of information 2. Flexible system integration - Generic functionality of process layer, easier to change process logic, island automation 3. Execution transparency - Operational information (active cases), historical information (completed cases) 4. Rule enforcement - Reducing freedom of executing process, enforcing separation of duties Setting boundaries of automation - Not all processes can be automated - Establish which parts of a process can be coordinated by BPMS and which cannot - Three types of tasks to be distinguished 1. Automated: performed by BPMS or external service 2. Manual: performed by process participants without aid of software 3. User: performed by a participant with assistance of worklist handler of BPMS or external task list manager Downloaded by Varun Amin ([email protected])