UNIT 5

BUSINESS PROCESS MANAGEMENT

TOPICS:

Lesson 1 Business Process Management (BPM)?

Lesson 2 Various Types of Business Process Management Systems?
Lesson 3 BPM Lifecycle
Lesson 4 Benefits of Implementing Business Process Management?
Lesson 5 Components of Performance Management System
Lesson 6 8 Best Practices in Business Management
Lesson 7 Business Process Map

Duration: 9 hours (Week 12-14)

Introduction

Business Process Management (BPM) is a way to improve and

standardize processes in an organization. It can eliminate human error and
process gaps while improving efficiency and compliance. This guide expands
on what BPM is and how it can positively impact organizations.

Learning Objectives
After studying this unit, the student should be able to:
1. Understand what is Business Process Management
2. To know the 5 Steps in Business Process Management
3. Understand the Benefits of Implementing Business Process Management
4. Understand the difference between Business Process Automation (BPA) vs. Busin
Process Management (BPM)
5. To know about the Components of Performance Management System
6. To know how to use Business Process Mapping Symbols

PRE-TEST/ACTIVITY
1. What is the motive of business process management?
What is Business Process Management (BPM)?
2. Give atleast 5 examples of processes that involved with BPM.
Business process management (BPM), as defined by Gartner, is a
3. Choose twodiscipline
among that
the benefits of Implementing
uses various Business
tools and methods to Process Management,
design, model, execute,
explain and why?monitor, and optimize business processes. A business process coordinates
the behavior of people, systems, information, and things to produce business
outcomes in support of a business strategy.

Introduction

BPM focuses on putting a consistent, automated process in place for

routine transactions and human interactions. It helps to reduce the business’s
operational costs by decreasing waste and rework, and by increasing the
overall efficiency of the team.

Organizations engaged in BPM can choose to follow one of the various

BPM methodologies, which include Six Sigma and Lean.

LESSON 1

What BPM is Not?

BPM is not a software product

There are BPM tools available that help in implementing standard and
automated business processes. For example, HappyFox Workflows helps
businesses automate complex, multi-step, and repetitive business processes.
BPM, however, is not a software product in itself.

BPM is not Task Management

Task or Project Management is about handling or organizing a set of

activities. A project management software like Microsoft Project, Jira, Asana,
or Trello helps in managing tasks and ad-hoc projects. Business Process
Management, on the other hand, is focused more on repetitive and ongoing
processes that follow a predictable pattern or process management.
What are the Various Types of Business Process Management
Systems?

BPM systems can be categorized based on the purpose that they

serve. Here are the three types of business process management:

System-Centric BPM (or Integration-Centric BPM)

This type of business process management system handles processes
that primarily depend on existing business systems (e.g., HRMS, CRM, ERP)
without much human involvement. A system-centric business process
management software has extensive integrations and API access to be able
to create fast and efficient business processes. An example of an integration-
centric process is online banking, which can include different software
systems coming together.

Human-Centric BPM
Human-centric BPM considers the people first, supported by various
automation functions. These are processes that are primarily executed by
humans, and automation does not easily replace them. These often have a lot
of approvals and tasks performed by individuals. Examples of human-centric
processes include providing customer service, handling complaints, on-
boarding employees, conducting e-commerce activities, and filing expense
reports.

LESSON 2

BPM Lifecycle: The 5 Steps in Business Process Management

Step 1: Design

Business analysts review current business rules, interview the various

stakeholders, and discuss desired outcomes with management. The goal of
the process design stage is to gain an understanding of the business rules
and ensure if the results are in alignment with the organizational goals.

Step 2: Model

Modeling refers to identifying, defining, and making a representation of

new processes to support the current business rules for various stakeholders.

Step 3: Execute

Execute the business process by testing it live with a small group of

users first and then open it up to all users. In the case of automated
workflows, artificially throttle the process to minimize errors.

Step 4: Monitor

Establish Key Performance Indicators (KPIs) and track metrics against

them using reports or dashboards. It’s essential to focus on the macro or
micro indicators – an entire process vs. process segments.

Step 5: Optimize

With an effective reporting system in place, an organization can

effectively steer operations toward optimization or process improvement.
Business Process Optimization (BPO) is the redesign of the business
processes to streamline and improve process efficiency and strengthen the
alignment of individual business processes with a comprehensive strategy.

LESSON 3

What are the Benefits of Implementing Business Process Management?

Business Process Management helps organizations move toward total digital

transformation and help them realize bigger organizational goals. Here are
some of the key benefits of using BPM in your business:

Improved Business Agility

 Changing and optimizing an organization’s business processes is
necessary to keep up with the market conditions. BPM allows organizations to
pause business processes, implement changes, and re-execute them.
Altering workflows, as well as reusing and customizing them, enables
business processes to become more responsive and gives the organization
deeper insights into the effects that process modifications have.

Reduced Costs and Higher Revenues

A business process management tool eradicates bottlenecks, which

significantly reduces costs over time. An effect of this can be a reduction in
lead times for product sales, giving customers quick access to services and
products, which leads to higher sales and improved revenue. BPM solutions
can also allocate and track resources to reduce waste, which can also reduce
costs and lead to higher profits.

Higher Efficiency

The integration of business processes brings the potential for end-to-

end improvement in process efficiency. With the right information, process
owners can closely monitor delays and allocate additional resources if
needed. Automation and the removal of repetitive tasks, add to more
efficiencies in the business process.

Better Visibility

BPM software enables automation while ensuring real-time monitoring

of key performance metrics. This enhanced transparency leads to better
management and the ability to modify structures and processes efficiently
while tracking outcomes.

Compliance, Safety, and Security

A comprehensive BPM guarantees that organizations comply with

standards and stay up to date with the law. BPM can also promote safety and
security measures by properly documenting procedures and facilitating
compliance. As a result, organizations can encourage their staff to safeguard
organization assets, such as private information and physical resources from
misuse, loss, or theft.

LESSON 4
When should Organizations Implement Business Process Management?

Here are some examples of business processes where implementing BPM

will result in a high return on investment.

1. Dynamic processes that require regulatory compliance changes,

such as a change in customer information management following
changes in finance or privacy laws.

2. Complex business processes that require orchestration and

coordination across multiple business units, divisions, functional
departments, or workgroups.

3. Measurable mission-critical processes that directly improve a crucial

performance metric.

4. Business processes that require one or more legacy applications for

their completion.

5. Business processes with exceptions that are handled manually

and/or require quick turnarounds.

LESSON 5

Business Process Automation (BPA) vs. Business Process Management

(BPM)

Business process automation (BPA) and business process

management (BPM) are related, and in some ways complementary, but
they’re not the same. BPA is about automating processes, while BPM is about
managing processes, which may or may not involve automation. Simply put,
all BPA can be considered to be a form of BPM, but not all BPM may include
BPA.

Business Process Automation (BPA) refers to any method that is used to

streamline business processes through automation. It can take on a wide
variety of applications and tools that aim to achieve gains in productivity,
agility, efficiency, and compliance in the day-to-day tasks of a business.

Common examples of processes that benefit from BPA include:

  Employee on-boarding and off-boarding
 Vacation requests
 HR requests
 Expense filing
 New equipment requests
 IT support requests

Business processes that are suitable for automation are typically those
that are started by a specific, triggering event. For example, the filing of an
expense report may trigger a pre-defined series of steps that ends when the
employee receiving reimbursement in their bank account.

BPM, on the other hand, is a systematic approach to improving

business processes. When it is successfully implemented, everyone
understands better how they contribute to the achievement of organizational
goals. This generally leads to a happier, more productive workforce, which
tends to result in happier customers, higher revenues, and lower costs.

LESSON 6

Components of Performance Management System

Any effective performance management system includes the following

components:

1. Performance Planning

Performance planning is the first crucial component of any

performance management process which forms the basis of
performance appraisals. Performance planning is jointly done by the
appraisee and also the reviewee in the beginning of a performance
session. During this period, the employees decide upon the targets and
the key performance areas which can be performed over a year within
the performance budget, which is finalized after a mutual agreement
between the reporting officer and the employee.
2. Performance Appraisal and Reviewing

The appraisals are normally performed twice in a year in an

organization in the form of mid reviews and annual reviews which is
held in the end of the financial year. In this process, the appraisee first
offers the self filled up ratings in the self appraisal form and also
describes his/her achievements over a period of time in quantifiable
terms. After the self appraisal, the final ratings are provided by the
appraiser for the quantifiable and measurable achievements of the
employee being appraised. The entire process of review seeks an
active participation of both the employee and the appraiser for
analyzing the causes of loopholes in the performance and how it can
be overcome. This has been discussed in the performance feedback
section.

3. Feedback on the Performance followed by personal counseling

and performance facilitation

Feedback and counseling is given a lot of importance in the

performance management process. This is the stage in which the
employee acquires awareness from the appraiser about the areas of
improvements and also information on whether the employee is
contributing the expected levels of performance or not. The employee
receives an open and a very transparent feedback and along with this
the training and development needs of the employee is also identified.
The appraiser adopts all the possible steps to ensure that the
employee meets the expected outcomes for an organization through
effective personal counseling and guidance, mentoring and
representing the employee in training programmes which develop the
competencies and improve the overall productivity.

4. Rewarding good performance

This is a very vital component as it will determine the work

motivation of an employee. During this stage, an employee is publicly
recognized for good performance and is rewarded. This stage is very
sensitive for an employee as this may have a direct influence on the
self esteem and achievement orientation. Any contributions duly
recognized by an organization helps an employee in coping up with the
failures successfully and satisfies the need for affection.

5. Performance Improvement Plans

In this stage, fresh set of goals are established for an employee

and new deadline is provided for accomplishing those objectives. The
 employee is clearly communicated about the areas in which the
employee is expected to improve and a stipulated deadline is also
assigned within which the employee must show this improvement. This
plan is jointly developed by the appraisee and the appraiser and is
mutually approved.

6. Potential Appraisal

Potential appraisal forms a basis for both lateral and vertical movement
of employees. By implementing competency mapping and various
assessment techniques, potential appraisal is performed. Potential
appraisal provides crucial inputs for succession planning and job
rotation.

LESSON 7

8 Best Practices in Business Management

A great business leader is someone who can motivate their team and
follow business management best practices for success. Business
management is the process by which a company gets its employees to
produce the greatest results with the least amount of effort using the
resources available to them. Attending a master’s degree program in business
administration allows you to study what motivates employees to work
efficiently and shows you some best practices for making an organization
culturally effective. Based on the work of Patrick Lencioni, the best-selling
author of 10 business management books, the following eight practices can
transform a struggling business into a streamlined system in which employees
are inspired to produce their best work.

1. Engage Workers

Alienated workers do not care about performing their jobs. All they care
about is getting a paycheck and advancing their own interests. The first thing
a manager needs to do is find out how to make his employees care about the
company's vision. Engaged workers are not only more enthusiastic and
productive; they also become less passive, taking responsibility for their
performance and attracting fresh talent to the company.
2. Reward Effort

No one likes their work to go unrecognized. Recognition of effort and

achievement – thanks for a job well done – makes employees feel valued. It
seems like an obvious point, but often business management
training overlooks the positive impact of appreciation. Some managers might
even feel that being too "touchy-feely" undermines their authority. On the
contrary, reward motivates people to achieve more and helps to build
company loyalty.

3. Be Vulnerable

Vulnerability is a recurring theme in Lencioni's business management

articles. He believes that managers need to stop being anonymous figures in
the lives of junior employees and that getting to know employees is one of the
best ways for management to engage their workers. He also sees
vulnerability as crucial in team dynamics; without being able to speak openly
and put one's ideas on the spot, it is impossible for teams to build trust.

4. Stay Committed

When team members don't trust each other, they devote a lot of time to
avoiding conflict rather than airing their real opinions and working to find
common ground. A state of perpetual ambiguity ensues, in which clear goals
and strategies fail to emerge out of group discussion. Lencioni labels this lack
of commitment the "third dysfunction" of team dynamics. It can lead to
poor decision making and stifle productivity. Staying committed to the team's
initiative means creating an atmosphere where conflict is welcomed,
not feared, because differing perspectives help to shape a clear goal.

5. Seek Clarity

A problem with many companies is a lack of alignment among

managers, who either stop working to fulfill the company's vision or never
understood what that vision was. Lencioni points out that company's need to
focus on alignment of core principles by asking the following six questions:

 Why do we exist?
 How do we behave?
 What do we do?
 How will we succeed?
 What is most important, right now?
 Who must do what?
 Without leaders developing – and sharing – a clear sense of the
company's vision, its values, its strategic goals, and its delegation of
responsibilities, the best business management education in the world won't
matter, because the company will lack purpose and direction.

6. Create Cultural Cohesiveness

Here, "culture" doesn't refer to socioeconomic status or ethnicity.

Rather, it means a sense of shared values that, with the right level of
engagement, will lead to the development of productive and efficient
outcomes. It is a good business management practice to make new hires
based on an alignment with the company's core values and
its vision, because workers with shared values make good team
members. Diversity of race, gender, and socioeconomic status is a positive
thing because it increases collective insight. But, diversity in values can lead
to a company's downfall.

7. Focus Team Effort

Sometimes managers invest the bulk of their energy on making sure

that the team gets off on the right foot, hosting retreats to boost solidarity and
being attentive to ideas as they first come out. It's essential to focus on
ongoing team dynamics, however, to make sure that members don't get
distracted by individual activities that lead them off track. Consistent
reassessment and realignment of team goals is the way to achieve the best
results.

8. Hold Regular Meetings

In an overview of his book, The Advantage, Lencioni has this to say

about the importance of meetings to a company's success: "No action, activity
or process is more central to creating a healthy organization than the
meeting." He suggests that, in order to be fully successful, management
should do the following:

 Create separate meetings for tactical and strategic business

planning.
 Assess a tactical agenda only after the team has reviewed its
progress against goals.
 Make sure there is enough time allocated for the clarification,
debate, and resolution of major issues.
 Meet quarterly outside the office to review what is happening in
the industry, the company, and the team.
 Meetings provide the organization with a regular forum on core values,
allowing members to realign principles and give perspective on business
practices.

In order to succeed in a competitive field like business management,

you need to stay true to yourself before you can hope to have a meaningful
impact on the organization you represent. Ultimately, the best practices are
ones that focus on your developing authentic connections among yourself, the
junior employees, and the company as a whole.