BPM 101- A Guide to Business Process Management

bpm 101 a guide to business process management

What Really is Business Process Management?

Business process management, commonly abbreviated as BPM, is a practice involving the modeling, implementation, controlling, monitoring, and refinement of business activity flows. Objectives of BPM include the optimization of existing business processes and supporting business objectives.

As digital transformation processes are becoming more popular, BPM is adapting by including groundbreaking technological advancements. From robotic process automation to low code platforms, there are virtually endless opportunities for BPM to evolve.

Consistent process improvement is essential for businesses to maintain a competitive advantage and contains multiple stages. The 5 stages of the BPM life cycle include-

1. Modeling

The modeling phase analyzes the details of a process from beginning to end. From there, process modeling or workflow software can be used to create a diagram or flow in order to visualize the process in its entirety.

During the modeling phase, pain points and improvement areas should be identified. Identifying potential issues supplies businesses with an opportunity to undertake risk management initiatives preventatively.

2. Implementation

The main two types of implementation are systemic and non systemic. Non systemic implementation uses BPM software or BPM tools during the implementation stage while non systemic implementation does not.

The objective of the implementation stage is to bring the workflow management designs of the previous stage to fruition.

3. Execution

The execution stage enacts the modeled business processes from the previous two stages. It is crucial that end users are the focus of this stage as they will interact with the process the most heavily.

Identifying pain points, bottlenecks, and potential problem areas should be especially focal in this stage.

4. Monitoring

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Previously established key performance indicators, commonly abbreviated as KPIs, are measured during this stage. KPIs may monitor a wide variety of business process components ranging from financial goals to error rates.

With the data gathered during the monitoring stage, improvements and corrective action can be implemented.

5. Refining

The refinement stage seeks to bridge any discrepancies between process modeling and actual performance levels. Once this step is completed, the BPM life cycle can start anew.

The Main Importance of Business Process Management

Business process management is crucial to the financial success and longevity of a business. Proper BPM results in higher productivity, efficiency, and effectiveness levels for all business processes performed.

Instead of being intimidated by the workforce management process, businesses can use BPM to maintain better control over their business processes as well as gain a competitive advantage. Improved control and consistency allow businesses to better serve and retain customers.

The transparency and agility that BPM provides businesses help with difficult decision making and increases the likelihood of finding innovative solutions. Decreasing wastefulness and bottlenecks results in leaner management capabilities and posits businesses as leaders in sustainability initiatives.

BPM is not a one time process of set activities that will solve business process inefficiencies, it is a process that is continually performed. Although business process management provides a wide variety of benefits for businesses it can be difficult to implement and maintain.

The 5 Biggest Challenges with Business Process Management

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Even when equipped with an abundance of information regarding the life cycle stages of BPM, business professionals may still feel overwhelmed. Gaining a better understanding of what challenges are frequently faced during BPM can help businesses to better execute their own process.

5 common problem areas of business process management include-

1. End User Buy Ins

A business process management system is useless without end user buy ins. Thankfully, there are many BPM solution tips available for business process management professionals to utilize.

One common fear of employees is that business process management systems are going to take away the need for human labor and make their role at a company obsolete. It is crucial for management professionals to explain to their employees that both BPM tools and BPM software are being implemented to help increase worker efficiency, not to replace them entirely.

If possible, management should request demo BPM software for employees to try out and provide feedback on. A one time comprehensive training course that includes process modeling is a great option to introduce workers to newly implemented BPM software programs.

2. Executive Buy Ins

Unfortunately, many people hold a negative view of BPM. Particularly if they have had negative experiences in the past, even executives can be hesitant to buy in.

With an increase in BPM software and BPM tools it is more realistic than ever before for business process management to be successful. Make sure that set activities match business objectives and offer measurable process improvement solutions to avoid losing executive trust regarding BPM.

3. Adaptability

Great BPM requires constant process improvement which necessitates agility and adaptability. Focusing strictly on pre-planned set activities instead of evolving business objectives can end up being counterproductive.

Businesses must make sure to have the BPM tools available to switch tasks on an ad hoc basis.

4. KPIs

KPIs help businesses to measure business process success rates. Unfortunately, some business process management professionals do not feel comfortable assigning KPIs to avoid the uncomfortable feelings associated with not accomplishing them.

However, without KPIs it is difficult if not impossible to quantify business process management successes. Businesses must make sure their KPIs are realistic and attainable in order for them to be effective.

Additionally, when KPIs are effectively met it is easier to attain support for BPM initiatives in the future.

5. Technology

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Digital transformation can be intimidating with so much advanced technology involved ranging from robotic process automation to low code platforms. BPM must stay focused on the end to end business process instead of hyper fixating on technological enhancements.

3 Top Benefits of Business Process Management

Without providing companies with extensive benefits, BPM would not be a realistic or appropriate undertaking. The 3 top benefits of business process management that companies can expect to experience include-

1. Adaptability

BPM is not a one time event where set activities are performed and then a company goes back to business as normal. In order to stay competitive in an increasingly expanding global market, businesses must improve business processes consistently.

Whether facing a change in internal business rules or external regulations, a company must be able to adapt its business processes quickly and effectively. Process improvement can even prompt new opportunities including an expanded customer base and new business partners.

Alternatively, outdated business processes can lead to massive financial consequences, damages to brand reputation, and even business closure.

2. Efficiency

A principal objective of BPM is to increase business process efficiency. There are many reasons a business process might be inefficient, ranging from the poor collaboration between departments to a failure to properly implement process automation solutions.

BPM encourages companies to comprehensively evaluate where their business processes can be improved and then take the action needed to do so.

3. Effectiveness

Once BPM makes business processes more efficient, the next challenge is to make them more effective. Greater business process effectiveness allows businesses to make better decisions and provides a better customer experience.

A crucial part of making business processes more effective is to make sure that business rules and objectives match with the established BPM strategy. Continual process improvement increases bottom line profits and allows businesses to maintain a competitive advantage.

5 Clear Cut Examples of Business Process Management

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Business process management includes a wide variety of set activities and procedures. With so much occurring simultaneously it is helpful to analyze real world BPM examples.

5 examples of successful BPM categorized by business process type include-

1. Vendor Management

Improper vendor management can result in many significant business consequences including overpriced raw materials. Proper vendor management seeks to locate and contract affordable, consistent, and reliable suppliers.

A BPM solution to vendor management issues is accomplished by using a vendor risk management strategy. A vendor risk management strategy would help businesses to create contracts with companies that match their business rules and objectives.

2. Business Strategy

Business process improvement should positively influence all aspects of a business. Using BPM to optimize a business strategy is a great way to make sure all business processes are being continuously analyzed and improved.

An effective business strategy is not a one time procedure. In order for a business and its processes to be efficient and productive, business strategies must be updated constantly.

3. Contract Management

Contract management is widely considered to be a challenging business process but thankfully there are BPM solutions available. One BPM solution for contract management is the implementation of an automated workflow for contract creation.

Workflow management solutions such as an automated workflow for contract creation minimizes the likelihood of human error and allows for seamless reference.

4. Purchase Approval

There are many BPM solutions available to assist with a business's purchase approval process. In fact, the workflow management solutions that benefit the process contract management process are also helpful for purchase approval, providing optimal vendor contracts that are easily referenceable.

Process modeling can be used to designate specific business rules regarding purchasing and avoid rogue spending. Data entry process automation can be utilized to avoid any human error which can result in costly routing errors or inaccurate accounting.

5. Invoice Processing

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Fraud and human error are significant process inefficiencies that can occur during invoice processing. BPM software helps businesses with workflow automation to avoid fraud, decrease shipment delays, and minimize human error.

Why Every Business Should Use Business Process Management Software

BPM software not only embraces digital transformation but also increases innovation. BPM tools contained within business process management software can decrease costly errors significantly.

It is no surprise that many businesses choose to invest in BPM software. 4 core benefits of BPM software include-

1. Risk Management

The transparency provided by BPM software decreases the likelihood of costly errors. Process automation significantly minimizes mistakes as business processes are standardized.

Instead of spending time dealing with risk management disasters, businesses can focus on further improving their business processes and operations.

2. Operational Control

BPM tools consistently monitor and measure business processes in order to grant businesses with the highest level of control possible. Visual aids like dashboards and data charts present information about complex data points in an easily accessible format.

3. Agility

With ever changing market trends and sales forecasting demands, agility is essential. Not only can businesses use the BPM tools incorporated in management software to address these variations, but they can also look into the future to secure a competitive advantage.

Optimized risk management, operational control, and agility bring businesses to the next level, creating opportunities for development and expansion. BPM software provides scaling opportunities that grow alongside a business.

4. Collaboration

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Implementing and maintaining communication channels can be extremely difficult for businesses to accomplish. BPM software establishes a centralized platform for messages, file sharing, and notifications that everyone can access.

Collaboration is greatly improved with the universal communication channel that BPM software provides.

Conclusion

  • The five main stages of BPM are modeling, implementation, controlling, monitoring, and refinement.
  • Business process automation and workforce management are important components of BPM.
  • The top benefits of BPM include adaptability, efficiency, and effectiveness. These benefits are even further increased by investing in and implementing BPM software.

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