Saturday, January 17, 2009

BPM Series: Do business organisations need single process management infrastructure?

Last week, a friend sought my advice on whether her company should implement single process management infrastructure to automate & manage their enterprise-wide process management needs. The insurance company she works for is evaluating BPM system / application to automate travel reimbursement process. While doing so, the company is also exploring the possibility to utilise the same process management infrastructure to automate processes such as New Business process, Policy servicing process, Claims Management process, New Product Development process, etc.

Now the processes described above are different in nature and have different traits. I remembered having read an interesting process classification theory put forward by two wise men (unfortunately I do not remember their names) many years ago. They classified organisational business processed based on Business Value (Revenue Increase, Cost Reduction, Productivity / Efficiency enhancement, etc) and their Repeatability, i.e. their ability to repeat itself for every instance of the process that occurs.



As is shown in the diagram above, organisational processes can be classified into four areas:
  • Production processes - with high business value and high degree of repeatability;e.g. New Business process, policy servicing process, claims management process

  • Collaborative processes - with high business value but low degree of repeatability, e.g. New Product Development, Contract Formulation

  • Admin processes - with low business value but high degree of repeatability; e.g. Travel Reimbursement process, Leave approval process, Conference booking process

  • Miscellaneous / Ad-hoc processes - with low business value and low degree of repeatability
In my opinion, the same process management infrastructure may not be utilised to manage all the types of processes described above. There are two issues:
  1. Is the BPM system capable to manage both repeatable and non-repeatable processes

  2. Is it financially feasible for the organisation to manage high value and low value processes using the same BPM system
Fortunately, BPM systems have evolved over a period in time, and some of the leading BPM systems now possess dynamic process management capbility, which allow business users to alter the flow of the process even at run time, i.e. as the business process gets executed. Such BPM systems would address issue #1.

However, these BPM systems tend to be expensive requiring high end IT infrastructure. In such cases, software, hardware and implementation services costs tend to be prohibitively high to justify the utlisation of the same process management infrastructure for low value admin processes along with high value add production and collaborative processes.

So, in my opinion, organisation may have to settle for more than one process management infrastructure to manage all the enterprisewide processes. What do you think?

1 comment:

  1. software, hardware and implementation services costs tend to be prohibitively high to justify the utlisation of the same process management infrastructure for low value admin processes along with high value add production and collaborative processes.

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