Handbook on Business Process Management 2 - Strategic Alignment, Governance, People and Culture

Foreword

How to Read this Handbook

Contents

Contributors

Part I

Strategic Alignment

Delivering Business Strategy Through Process Management

1 Introduction

2 Lost in Translation

2.1 Today´s Reality

2.2 The Outside-in Perspective: The One that Counts

2.3 Methodology Implications

3 An Integrative Model from Drivers Through Aligned Capability

3.1 Validate Strategic Direction (Methodology 1.1)

3.1.1 Purpose of the Activity

3.1.2 Strategic Concepts

3.1.3 Scope of the Strategic Models

3.1.4 External Assessments

3.1.5 Strategic Analysis of External Assessments

Business Scenario Analysis

Value Proposition

Balanced Scorecard

3.1.6 Documenting the Strategic Intent

3.2 Determine Stakeholder Relationships (Methodology 1.2)

3.2.1 Purpose of the Activity

3.2.2 The Stakeholder Business Context

3.2.3 Stakeholder Relationship Analysis

3.2.4 Stakeholder Expectations and Goals

3.2.5 Measurement of Relationship Performance

3.2.6 Critical Success Factors (CSFs) and Required Capability for Relationship Success

3.3 Consolidate Strategic Criteria (Methodology 1.3)

3.3.1 Purpose of the Activity

3.4 Architect Business Processes (Methodology 2.1)

3.4.1 Purpose of the Activity

3.4.2 Lifecycle Approach to Building the Architecture

3.4.3 Reference Frameworks Approach to Building the Architecture

Generic Enterprise Models

Industry-Specific Models

Domain-Specific Models

Process, Lifecycle, and Value Chain Models

3.4.4 Architecture Consolidation

3.5 Identify Measures of Performance (Methodology 2.2)

3.5.1 Purpose of the Activity

Top Down and Horizontal Perspectives

3.6 Align Process Governance (Methodology 2.3)

3.6.1 Purpose of the Activity

3.6.2 Motivation Alignment and Stewardship Support

3.7 Prioritize Processes (Methodology 2.4)

3.7.1 Purpose of the Activity

3.7.2 Matrix Alignment Approach

The Process/Stakeholder Value Matrix

The Process/Stakeholder Performance Gap Matrix

Pain and Gain

3.8 Align Process Capabilities (Methodology 2.5)

3.8.1 Purpose of the Activity

3.9 Establish Enterprise Transformation Portfolio (Methodology 2.6)

3.9.1 Purpose of the Activity

4 Conclusion

References

Management of Process Excellence

1 Management of Process Excellence (MPE) Requirements and Approach

2 Innovation: Key Target of MPE

3 Information Technology Enabling the Execution of MPE

4 Business Process Governance for MPE

References

Process Capital as Strategic Success Factor:The Lufthansa Example

1 Processes as Intangible Assets (``Process Capital´´)

2 The Correlation Between Strategy and Process Capital

2.1 Overview

2.2 Core Competencies in Process Capital

2.3 Strategy Implementation Using Process Capital

3 Process Capital Management

3.1 Overview

3.2 Anchoring Process Capitals in the Strategy

3.3 Building up Process Capital

3.4 Managing Process Capital

4 Case Study: Lufthansa AG

4.1 Example of Lufthansa´s Process Capital

4.2 Strategy Implementation at Lufthansa Based on Process Capital

4.2.1 Passenger Handling

4.2.2 In-Flight Service

4.2.3 Operations

5 Summary and Outlook

References

Process Classification Frameworks

1 Introduction

2 Framework Development

2.1 Background

2.2 A Framework for Behavior Classification and Modeling

2.3 Application of the Framework

2.3.1 Integration of Behavioral Descriptions

2.4 Process Architecture Analysis

2.5 Process Architecture Development

3 Conclusion and Future Work

References

Taxonomy of Business Process Management Approaches

1 Introduction and Motivation

2 Situational Method Engineering

2.1 Design Research for Information Systems

2.2 Representation of Situational Aspects in SME

2.3 Method Fragments as Building Blocks in SME

3 Empirical Study on Business Process Management Approaches

3.1 Data Set and Course of Analysis

3.2 BPM Design Factors

3.3 BPM Realization Approaches

3.4 BPM Project Types

4 Exemplary Adaptation of the ``Process Innovation´´ Method

4.1 Overview of the Method

4.2 Situation-Specific Embodiments of the Method

5 Conclusion and Outlook

References

Process Performance Management

1 Measurement as Part of Operational Process Controlling

2 Approaches for Measuring Process Performance

2.1 Concepts for Performance Measurement

2.2 Process Performance Measurement Based on Indicators, Measures, and Figures

2.3 Measurements to Determine Process Performance

2.4 Frameworks for Measuring Process Performance

3 Development of a Company-Specific Process Performance Measurement System

3.1 Setting the Process Objectives

3.2 Identifying Critical Process Success Factors

3.3 Deriving Performance Indicators, Measures, and Figures

4 Conclusion

References

Business Process Analytics

1 Introduction

2 Sources for Process Analytics Data

3 A Source Format for Process Events

4 Process Metrics

5 Quality Criteria for Process Metrics

6 Historical Process Analysis

7 Real-Time Process Analysis

8 Predictive Process Analysis

8.1 Simulation

8.2 Data Mining

8.3 Process Optimization

9 Summary

References

Managing Regulatory Compliance in Business Processes

1 Introduction

2 Scenario and Background

3 Methodology for Compliance Management

3.1 Control Directory Management

3.2 Ontological Alignment

3.3 Modeling Controls

3.4 Process Model Enrichment

3.5 Compliance Enforcement

3.6 Compliance Monitoring

4 State of the Art

4.1 Modeling Controls

4.2 Process Model Enrichment

4.3 Summary

5 Discussion and Outlook

References

Prioritizing Process Improvement: An Example from the Australian Financial Services Sector

1 Introduction and Background

2 Introducing the Case Organization

3 Building the Business Value Scoring Tool

3.1 High Level Overview of the Business Value Scoring Tool

3.2 Understanding the Components of the Tool

3.2.1 Dimensions of Measurement

3.2.2 Outcomes and Scores for Each Dimension

3.2.3 Choice of Evaluation Perspective

3.2.4 Cost Calculations

3.2.5 Formula Manipulation

4 Testing and Implementing the Tool

5 Tool Adoptability and Application

6 Conclusion

Appendix1: QIC Organizational Chart

Appendix2: Business Value Score Tool Elements

References

Part II

Governance

Business Process Governance

1 Introduction

2 The Management of Organizational Structures and Business Process Governance

2.1 Management Hierarchies and Business Processes

2.2 Lateral Relations and Process Organization Mechanisms of Business Process Governance

2.3 Tradeoffs in Organizational Design and Business Process Governance

3 Process Governance Within Organizations

3.1 Process Coordination Units: The Example of Duke Power

3.2 Process Organization: The Example of Texas Instruments

3.3 Process Unit: The Example of Shared Services at Procter and Gamble

4 Governing Processes that Cross Organizational Lines

4.1 Multiple Mechanisms for Inter-Organizational Process Governance: The Example of San Mateo County EMS

4.2 Multiple Mechanisms for Inter-Organizational Process Governance: The Supply Chain Management Example

5 Concluding Remarks

References

Business Process Management Governance

1 Introduction

2 Research

3 Obstacles

3.1 Reference Models Lack Cross-Functionality

3.2 Improvement Method Deployment

3.3 Process Maturity

4 BPM Governance Principles and Practices

5 Management Accountability

6 Measuring Performance

7 Process Management Plan

8 Deploying Information Technology

9 Summary

References

The Process of Business Process Management

1 Introduction

2 The Process of Business Process Management

2.1 Business Process Strategy Phase

2.2 Business Process Design Phase

2.3 Business Process Implementation Phase

2.4 Business Process Controlling Phase

3 Main Elements of a Holistic BPM Approach

4 Services and Responsibilities of a BPM Center of Excellence

4.1 BPM Leadership

4.2 Regulatory Framework

4.3 Project Support

4.4 Training, Communication, and Process Controlling

5 Roles Within a BPM Organization

6 Conclusion: How to Establish a Holistic BPM Approach Within an Organization

References

The Service Portfolio of a BPM Center of Excellence

1 Typical Stages of Business Process Management Adoption

2 The Business Process Management Service Portfolio

3 A Proposed List of Business Process Management Services

3.1 Business Process Management Maturity Assessment

3.2 Strategic Alignment

3.3 Process Modeling

3.4 Library Management

3.5 Process Improvement

3.6 Designing Process-Aware Information Systems

3.7 Process Automation

3.8 Process Change Management

3.9 Management of Business Process Management Projects

3.10 Process Governance

3.11 Process Compliance

3.12 Process Performance Measurement

3.13 Process Forensics

3.14 Process (Management) Education/Training

3.15 Process Portfolio Management

4 Case Study

5 Patterns in Business Process Management Center of Excellence Service Portfolios

6 Conclusion

References

BPM Center of Excellence: The Case of a Brazilian Company

1 Introduction

2 The BPM CoE´s Three Main Capabilities

2.1 Diffusion of BPM Culture

2.2 Creation of Convergence Among BPM Initiatives

2.3 Internal Consulting Orientation

3 Implementing a BPM CoE in a Brazilian Company

3.1 Organization´s Main Characteristics and its History of BPM Initiatives

3.2 The BPM CoE Initial Design and Implementation

3.2.1 CoE´s Insertion in the Organizational Structure

3.2.2 BPM Services and Governance Design

3.2.3 CoE´s Internal Routines, Methods and Tools Design

3.2.4 Design of the CoE´s Relationship with Other Organizational Areas

3.2.5 CoE´s Resources Design

3.2.6 Implementation Design

3.3 The Transition to a more Strategic Role of the BPM CoE

3.3.1 CoE´s Insertion in the Organizational Structure

3.3.2 BPM Services and Governance Design

3.3.3 CoE´s Internal Routines, Methods, and Tools Design

3.3.4 Design of the CoE´s Relationship with Other Organizational Areas

3.3.5 CoE´s Resources Design

3.3.6 Implementation Design

3.4 BPM CoE´s Implementation Analysis

3.5 Synthesis of Lessons Learnt and Tendencies of Evolution

4 Final Conclusions

References

Business Process Standardization

1 Standardization Dilemma

1.1 Defining Variation

2 Globally Consistent or Locally Relevant

2.1 Attraction of the Global

2.2 Attraction of the Local

2.3 Balancing Act

3 Local Variation

3.1 Reasons for Variations

3.2 Costs of Variation

4 Resolving the Dilemma

4.1 Global BPM Framework

4.2 Development and Management

4.3 Balancing Global and Local

4.4 Global BPM

4.5 Local BPM

5 Managing The Dilemma

5.1 Achieving Standardization

6 Summary

References

BPO through the BPM Lens: A Case Study

1 Introduction

2 Business Process Outsourcing: A Closer Look

3 Business Process Management Framework for Analysis

4 Case Study

4.1 Business Process Outsourcing Relationship 1: Maturing from Cost-Effective to Optimized

4.1.1 Process Details

4.1.2 Challenges/Interesting Aspects

4.1.3 Process Requirements

4.1.4 Technology Usage

4.1.5 Process Improvement

4.1.6 Critical Success Factors

4.1.7 Impact of the Business Process Management Initiative

4.2 Business Process Outsourcing Relationship 2: Eliminating the Work

4.2.1 Process Details

4.2.2 Challenges/Interesting Aspects

4.2.3 Process Requirements

4.2.4 Technology Usage

4.2.5 Process Improvements

4.2.6 Critical Success Factors

4.2.7 Impact of the Business Process Management Initiative

4.3 Business Process Outsourcing Relationship 3: Stabilizing for Predictability

4.3.1 Process Details

4.3.2 Challenges/Interesting Aspects

4.3.3 Process Requirements

4.3.4 Technology Usage

4.3.5 Process Improvement

4.3.6 Critical Success Factors

4.3.7 Impact of the Business Process Management Initiative

4.4 Case Study Analysis

4.4.1 Strategic Objectives

4.4.2 Business Process Management Lifecycle

Create (Identify, Define and Improve Processes)

Align (Link Processes to IT Systems)

Execute (Process Operations, Monitoring and Control)

4.4.3 Business Process Management Enablers

4.4.4 Business Process Management Governance, People, and Infrastructure

Business Process Management Roadmap and Strategy

Business Process Management Ownership

People Aspects

Process and Technology Infrastructure

5 Conclusions

References

Toward a Global Process Management System: The ThyssenKrupp Presta Case

1 Introduction

2 The Case Organization ThyssenKrupp Presta

3 Strategic Alignment of the Business-Driven Approach

4 Technical and Organizational Issues Involved in Using a Corporate Process Modeling and Documentation System

5 Governmental Issues of Setting the Right Structures

6 Finding a Stepwise Approach to Process Improvement

7 Summary and Outlook

References

Business Process Maturity in Public Administrations

1 Challenges of Public Administration Modernization

1.1 Problem Identification and Motivation

1.2 Design Science as the Overall Approach of Research

2 Define Objectives of a Solution

2.1 Preliminary Considerations

2.2 BPM in the Context of the 48-h-Service Promise

2.3 BPM Maturity for the Fulfillment of the 48-h-Service Promise

2.4 Specifics of Business Process Management in Public Administration

2.4.1 Factor: Strategic Alignment

2.4.2 Factor: Governance

2.4.3 Factor: Methods

2.4.4 Factor: Information Technology

2.4.5 Factor: People

2.4.6 Factor: Culture

3 Known Maturity Models for BPM and Public Administration

4 Design and Development

5 Demonstration and Evaluation

6 Summary and Outlook

References

Part III

People and Culture

Expertise in Business Process Management

1 Introduction and Background

2 Business Process Management Expertise Model

2.1 Constructs of the Model

2.1.1 Living System Construct

2.1.2 Knowledge Construct

2.1.3 Behavioral Characteristics Construct

2.1.4 Context Construct

2.2 Dynamic Nature of the Model

2.2.1 Knowledge Flows

2.2.2 Learning

3 Model Applicability

4 Summary

References

Business Process Management Curriculum

1 Introduction

2 Understanding the Role of Business Process Analyst in Current Business Process Management Practice

3 Business Process Analyst Curriculum Description

3.1 Course Descriptions

3.1.1 Business Process Modeling, Analysis, and Design

3.1.2 Additional Advanced Courses and Proposed Tracks

4 Limitations and Discussion

References

Dealing with Human-Driven Processes

1 Introduction

2 Human Interaction Management

2.1 Collaborative Transaction

2.2 Levels of Control

3 Goal-Oriented Organization Design

4 Respond to Request for Proposal

4.1 Roles

4.2 Interactions

4.3 Collaborative Transactions

5 Development of Branding Package

6 Conclusion

References

Knowledge Engineering in Business Process Management

1 Introduction

2 Knowledge Engineering in BP-Framework

2.1 The BP-Framework

2.1.1 The Business Model

2.1.2 The Domain

2.1.3 The Regulation

2.1.4 The Model Processing

2.2 Knowledge Engineering for BP-Framework

2.2.1 Analyzing Knowledge for KE in BP-Frameworks

2.2.2 Model-Based Approach for KE in BP-Framework

2.3 Conceptual Integration of KE and BP-Framework

2.3.1 Meta Model Frameworks

2.3.2 KE in BP-Framework Using the Meta Model Approach

2.4 Solutions for KE in BP-Framework

3 Knowledge Engineering in the BP-Management Method

3.1 The Organizational Context of BP-Framework

3.1.1 The BP-Management Method

3.1.2 Knowledge Intensive Actions in the BP-Method

3.2 KE Solutions for BP-Management Method

4 KE in BP-Deployment

4.1 Knowledge Techniques and Solutions for BP-Deployment

5 Outlooks on KE in BPM

5.1 Conceptual KE and BPM Alignment

5.2 Technical KE and BPM Alignment

6 Summary

References

Cultural Change in Process Management

1 Introduction

2 Prerequisites for Modeling Business Process Driven Organizational Change

2.1 Influencing Factors on Organizational Change

2.2 Approach for Describing Change Projects

2.2.1 Case Study: Implementation of the Customer Service Idea Within an IT Organization

2.3 Responsiveness to Change: An Explanatory Model

2.3.1 Case Study: Implementation of the Customer Service Idea Within an IT Organization

3 Change Method Engineering: Method Construction for Organizational Change

3.1 Basics of Method Construction

3.2 Structured Process of Method Construction

3.2.1 Analysis

3.2.2 Definition

3.2.3 Sequencing

3.2.4 Case Study: Implementation of the Customer Service Idea Within an IT Organization

3.3 Management Process for Change Method Engineering

4 Conclusion

References

Managing Creativity-intensive Processes: Learning from Film and Visual Effects Production

1 Introduction

2 The Case of Visual Effects (VFX) Production

3 Creativity-intensive Processes

3.1 The Dynamics of Creativity-intensive Processes

3.2 Structure versus Pockets of Creativity

4 Roles in Creativity-intensive Processes

4.1 Artists

4.2 Creative Supervisors

4.3 Clients

5 Managing Creativity-intensive Processes: Creativity-aware Business Process Management

5.1 Understanding and Refining the Requirements

5.2 Doing Work

5.2.1 Managing the Scope of Creativity

5.2.2 Allocating Resources

5.3 Evaluation of the (Intermediate) Creative Product

5.3.1 Approval Processes/Reviews

5.3.2 Ongoing Communication/Showing Work in Progress

5.4 The Use of Information Technology (IT)

5.4.1 Artist Systems

5.4.2 Groupware

5.4.3 Knowledge Management Systems

5.4.4 Asset Management Systems

5.4.5 Workflow Technology

5.5 Summary of Managerial Practices and IT Used in Creativity-intensive Processes

5.6 Measuring Creativity-intensive Processes

6 Conclusions

References

Global Processes and Data: The Culture Journey at Hilti Corporation

1 Introduction

2 Culture as an Integral Part of the Hilti Business Model

2.1 Introducing the Hilti Business Model

2.1.1 Purpose and Values

2.1.2 Our Culture Journey

2.1.3 Customer, Competence, and Concentration

2.1.4 Processes

2.1.5 Outcome

2.2 A Closer Look at Culture: The Hilti Culture Journey

2.2.1 Realizing a Corporate Culture: Taking Efforts for Values

2.2.2 Maintaining the Corporate Culture: Making Values Relevant

2.3 Implications for Hilti IT: A Business-Driven IT-Strategy

2.3.1 Impact on the IT Core Purpose Statement

2.3.2 Impact on the IT-Terminology

2.3.3 Impact on the IT-Organization

3 Global Processes and Data: An IT-Project Driven by Culture

3.1 Scope of the Project

3.1.1 IT Becomes Global

3.1.2 IT Supports Sales

3.2 Challenges Within the Project

3.2.1 Organizational Issues: Restructuring Hilti IT

3.2.2 Financial Issues: Adjusting the Budgeting Structure

3.3 The Role of Culture: Assessing the Cultural Leverage

4 Conclusion

References

An Organizational Approach to BPM: The Experience of an Australian Transport Provider

1 Introduction

1.1 BPM as a Technology Solution

1.2 BPM as a Lifecycle Approach

1.3 BPM as an Organizational Approach

1.4 Distinguishing a Lifecycle from an Organizational Approach

2 Background to Company Q

2.1 BPM Within Company Q

3 Developing a BPM Capability Framework

4 Applying the BPM Capability Framework in Company Q

4.1 BPM Communication

4.2 BPM Strategy Selection and Implementation

4.3 Internal BPM Consulting Engagements

5 Benefits of Adopting BPM as an Organizational Approach

5.1 Increased Customer Focus

5.2 Improved Strategic Planning and Strategy Deployment

5.3 Changing Human Resource Capability

5.4 Increased Recognition in BPM Community

6 Issues in Adopting BPM as an Organizational Approach

6.1 Changes in Business Model

6.2 Changes in Organizational Structure

6.3 Lessons Learnt During Company Q´s BPM Journey

6.3.1 Strategic Alignment

6.3.2 Governance

6.3.3 Methods

6.3.4 Information Technology

6.3.5 People

6.3.6 Culture

7 Conclusion

References

Who Is Who

Dr. Chris Aitken

Dr. Wasana Bandara

Prof. Dr. Ulrike Baumöl

Jyoti M. Bhat

Eric Brabnder

Markus Brenner

Ryan Brinkworth

Tobias Bucher

Roger Burlton

Prof. DSc. Heitor Caulliraux

Jim Champy

Prof. Dr. Andr Coners

Paul Coogans

David Court

Dr. Tonia de Bruin

Gaby Doebeli

Didier Elzinga

Jude Fernandez

Dr. Peter Fettke

Sukriti Goel

Dr. Guido Governatori

Alain Guillemain

Keith Harrison-Broninski

Dr. Diana Heckl

Alexandra Kokkonen

Dax D. Jacobson

Leandro Jesus

Prof. Dr. Dimitris Karagiannis

Daniel Karrer

Dr. Mathias Kirchmer

Bo sterberg Kristensen

Dr. Manish Kumar

Dr. Yvonne Lederer Antonucci

Prof. Dr. Peter Loos

Andr Macieira

Prof. Dr. M. Lynne Markus

Prof. Dr. Jrgen Moormann

Dr.-Ing Stefan Novotny

Dr. Martin Petry

Nicholas Rohmann

Prof. Dr. Michael Rosemann

Dr. Shazia Sadiq

Prof. Dr. August-Wilhelm Scheer

Dr. Stefan Seidel

Robert Shapiro

Katherine Shortland

Theresa Sinnl

Christian Sonnenberg

Andrew Spanyi

Christine Stephenson

Roger Tregear

Prof. Dr. Jan vom Brocke

Prof. Dr. Robert Winter

Dr. Robert Woitsch

Prof. Dr. Michael zur Mühlen

Jrg Zwicker

Index