Brief summary

The book *The Ultimate Guide to Business Process Management* provides a comprehensive overview of the fundamentals, structures, and methods of Business Process Management (BPM). It explains how processes are analyzed, modeled, optimized, and controlled to increase efficiency, quality, and adaptability in organizations. The focus is on process analysis, supplemented by the roles of the BPM Center of Excellence, modeling techniques, the BPM cycle, standard guidelines, and the BPM maturity model.

General ideas

As long as a company practices process management, it can adapt to any environment.

BPM serves to improve the way work is done.

Contents

5 functions of BPM

Business Process Management (BPM) comprises five main functions:

• Function Analysis: Evaluates business functions, supports strategy development, and reveals growth opportunities.

• Service Analysis: Identifies manual tasks and prepares processes for automation.

• Process Analysis: Analyzes end-to-end processes, uncovers weaknesses and shows optimization opportunities.

• Information Analysis: Maps information flows, identifies gaps, and improves communication channels.

• Workflow Analysis: Evaluates the data flow between applications, networks, and systems.

The book focuses on process analysis, as the other functions are mostly performed by IT specialists.

5 tasks of BPM

1. Business Strategy: Defines long-term corporate goals and growth potential. Creates strategic roadmaps and development plans.

2. Business Architecture: Designes structures, roles, governance, and systems for implementing the strategy.

3. Business Process Management (BPM): Models end-to-end processes from customer to customer. Ensures efficient and cost-effective processes.

4. Lean: Identifies and eliminates waste in processes. Increases the speed and transparency of operations.

5. Six Sigma: Uses data and statistics to measure process performance. Reduces variance and improves efficiency.

BPM Center of Excellence (CoE)

The BPM Center of Excellence serves as a central unit for controlling and standardizing BPM activities.

4 Levels of CoE:

• Performance Layer: Defines goals and best practices, manages the process repository, reviews projects, and monitors savings.

• Business Layer: Describes the organization of the CoE with its four pillars: People, Process, Governance and Technology.

• Service Layer: Provides services such as training, modeling, and analysis. Defines roles and responsibilities of the BPM teams.

• Technology Layer: Manages the central process repository and BPM tools. Ensures standards, versioning, and consistency.

4 Pillars of BPM CoE

• People: Defines roles, skills, and responsibilities to effectively implement BPM initiatives.

• Process: Provides methods, standards and frameworks to model, improve and manage processes.

• Governance: Establishes rules, monitoring, and decision-making structures for uniform and strategy-compliant BPM processes.

• Technology: Provides tools and platforms to support modeling, automation, monitoring, and knowledge sharing.

Process Modeling Techniques

• Process Maps: Static representations with limited visibility. No dynamic reference, high time expenditure.

• Process Models: Dynamic, tool-based models that map end-to-end processes. Changes are automatically reflected. Simulations are possible.

• Flowcharts: Simple, linear diagrams with standardized symbols. They show the sequential process.

• RACI Matrix / Functional Decomposition: Defines roles and responsibilities according to Responsible, Accountable, Consulted, and Informed. The functional decomposition lists processes with their responsible parties before they are modeled.

• Business Process Management Notation (BPMN): Standardized method for documenting business processes.

  • Flow Objects: Events start or end processes, activities are tasks, gateways branch or connect workflows.

  • Connecting Objects: Link tasks via sequences, message flows, and associations.

  • Swim Lanes: Organize activities by role or department.

  • Artifacts: Add contextual information such as data objects, groups, or annotations.

Create a Process Hierarchy

All process models are collected and assigned unique IDs. The APQC Process Classification Framework (PCF) serves as a reference for a unified taxonomy. Processes are directly linked to business services, products, and activities. Naming and structure are standardized, preventing spontaneous developments. The hierarchy forms a tree structure to identify relationships, gaps, and overlaps.

Organization Value Chain

The processes of an organization are structured based on the value chain and the individual tasks within it:

Operations:

1. Procurement

2. Inbound Logistics

3. Production

4. Outbound Logistics

5. Sales

6. Customer Service

Support:

7. Business Vision and Strategy

8. Finance Administration

9. Human Resources

10. marketing

11. Information Technology

    
    

This value chain organizes activities between business and IT and ensures clear process responsibility.

BPM Activity Cycle

Define: The customer submits a work request. The CoE manager approves the start.

Design: Analysts design the process model using customer input. Only the design is submitted.

Simulate: The model is tested, checked, and feedback is gathered.

Deployment: Introduction of the process with architects and process owners. Training of participants.

Execute: Process is put into operation. Support is available during the initial phase; phased implementation is possible.

Monitoring: Feedback is gathered through reports, surveys, or workshops. Results are reviewed.

Analyze: Feedback is evaluated, simulations are repeated, and recommendations are decided.

Optimize: Improvements are implemented, and process documentation is created.

Checklist for Standards

• Modeling: Creating a functional decomposition matrix to ensure a complete view and avoid duplication of effort.

• Formatting: Use of BPMN 1.2 or 2.0 for automation and metrics. Consistent symbol sizes, clear spacing, titles centered at the top, version data and author information for traceability.

• Gateways:

  • Exclusive gateways: Only one path is followed.

  • Including gateways: One or more paths

  • Parallel gateways: All paths are tracked. Clear criteria and complete percentage information are necessary.

• Tasks / Activities / Sub-processes: Break down tasks into sub-processes if details are needed. Use clear names in verb-noun format with a maximum of four words.

• Events: Every process begins and ends with events. Events describe the trigger.

• Flows: Message flows connect tasks or events, not gateways. Sequences only within the same pool. No overlapping lines.

• Other: All elements must be connected to the process. Documentation of the entire end-to-end process for improvement and redesign.

Procedure Guide Standards

• Use of uniform templates for layout and structure.

• Instructions correspond to the process steps.

• Clear formatting and limited screenshot width.

• Correct numbering, bold for clickable elements, italics for documents.

• End with "End of procedure" in the table field or "End of process" outside of it.

• Grammar and spelling check, consistent style, updated references and working links.

Process Measurement

Measurement of the current process before optimization begins. Creation of a data collection plan focusing on:

• throughput time

• cycle time

• Waiting time

• Activity costs

• Number of full-time equivalents (FTE)

• Service Level Agreements (SLAs)

These key performance indicators (KPIs) improve efficiency, costs, and quality. Important areas include staff utilization, activity costs, and capacity planning.

BPM Maturity Model

1. Non-existent: No BPM present, problem not detected.

2. Initial: First awareness, but unstructured, person-centered approaches.

3. Managed: Partially standardized processes, weak documentation, no training, high error rate.

4. Standardize: Processes are documented, training is provided, and binding regulations are enforced. Focus on consistency and basic automation.

5. Predictable: Processes are measured, results are predictable. Partial use of BPM tools.

6. Innovating: Fully optimized and integrated. Continuous improvement, strong IT support, and high adaptability.