Business Process Management 101: Decoding the jargon
When you first start out in process improvement, you might feel like everyone around you is speaking a strange form of Klingon. There are lots of acronyms to content with as well as unfamiliar and technically-laden terminology.
If you’re feeling a bit bewildered by it all, hopefully, our relatively no-nonsense guide to some of the high level Business Process Management terms will help set you on the path to the process Rosetta stone.
A business process is a series of tasks that are carried out in order to achieve a purpose. A business process may be manual (i.e. a human has to do it), automated (i.e. a machine or, increasingly, a computer system executes the process), or, as is most often the case these days, a process may contain a mixture of both manual and automated processes.
While it could be argued that everything we do is a process of some sort, a formalized approach to thinking about processes is often said to have originated with Adam Smith’s The Wealth of Nations where Smith described the advantages of the "division of labour" (effectively breaking processes down into a discrete set of steps and allocating different parts of the process to a specialist).
The science of process improvement/management gain paced in the Nineteenth and Twentieth Centuries with the rise of mass manufacturing and has continued to evolve to the present day where information technology systems now play an increasing role. For a more complete history of process, you might be interested in reading contributor Craig Reid’s take: A Brief History Of Process: From the Industrial Revolution To Today.
Process is just another name for the work we do
BPM – Business Process Management:
BPM is a management discipline that treats operational processes as assets that need to be maintained and improved to help drive enterprise performance. Translated, this means that everything a company does (i.e. its products and services) and how it does it (i.e. through its processes and, where relevant, the application of technology) can and should be improved to help the business serve customers better and increase profits. Like many other process-related disciplines - Business Process Reengineering, Six Sigma, Total Quality Management, Lean, etc. - Business Process Management seeks to improve customer satisfaction, reduce costs, and improve quality.
The trouble with BPM is that it has been applied to many different techniques and approaches. If BPM were a brand, one might say that it has a confused identity. Some of the trouble is historical: BPM has significant roots with the growth of Information Technology and indeed responsibility for BPM will often sit with the IT department. As a result many practitioners equate BPM with process automation (which is part of the picture but not the whole picture).
The way the BPM software industry developed hasn’t helped. As the industry grew, many vendors offering a wide array of software tools were classified (or classified themselves) as BPM software, but the capabilities they offer and problems they solve varied widely. (BPM blogger and consultant Sandy Kelmsley has written an excellent article series on A Short History of BPM which gives an excellent overview of the development of the BPM Software industry).
One of the results of such fragmentation on the vendor market is that many things fall under BPM – modelling tools, execution tools, content management tools, etc. – which when viewed in isolation appears confusing. What do modelling tools have in common with content management tools, for instance, and how can they both be BPM? However, as many of the small BPM software vendors have been bought up by larger players and the industry has become more and more consolidated – there are fewer independent vendors selling independent capabilities, which will perhaps lead to a more standardized set of capabilities.
Additionally, as a significant percentage of business processes remain unstructured and/or manual (i.e. rest outside of software systems) there is a decidedly softer side of Business Process Management which doesn’t involve technology at all. Instead, redesigning or reengineering processes that reside outside systems is an important part of Business Process Management and many BPM practitioners would consider process improvement toolsets like Lean and Six Sigma to be an integral part of BPM.
BPMS – Business Process Management Suite/System:
A BPMS is a set of software tools that help organizations to model, deploy and manage processes in our increasingly IT-enabled workplaces. Modern BPMS’s include process mapping & modelling (to document the process), document management, execution (i.e. to translate the models into a language that can be read and understood by a computer), business activity monitoring (i.e. keeping an eye on how a process is doing, such as the time it takes, number of errors, etc.), and more functionalities keep being adding to the BPMS arsenal.
Maps help us figure out where we are and help us get to where we want to go
Business process mapping:
Business process mapping involves drawing out all the activities involved in a business process, step-by-step, so that it’s entirely clear what is involved at any stage of a given business process. Business process maps are a useful baseline to help establish the key process steps and identify areas for improvement and are seen as the first step in any effort to improve and redesign processes. Until you know what you’re doing, it’s very hard to change it.
BPMN – Business Process Modelling Notation:
BPMN is a formal modelling "language" with a standardized set of graphical elements to represent different types of steps in a business process. BPMN helps different stakeholders in the business – process owners, IT, etc. – communicate about the business process and is generally agreed upon as the industry standard, although other modelling languages such as UML (Unified Modelling Language) are still used. BPMN is maintained and advanced by the Object Management Group, a not for profit standards organization.
Business Activity Monitoring (BAM):
Business Activity Monitoring or BAM is a component of most BPMS’s and allows managers to monitor how the business is doing in real time, enabling them to make decisions and respond quickly or anticipate potential problems. This is achieved through the tracking of key performance indicators (KPIs) as processes execute within a BPM system (BAM tracks key "process events") and often a systems of alerts that can call managers' attention to particular situations before they become critical.
Business Intelligence is a deeper form of Business Activity Monitoring and includes analysis of both real time and historical analysis of business process performance in order to support better decision making about both strategic and operational opportunities. Forrester Research defines Business Intelligence as "a set of methodologies, processes, architectures, and technologies that transform raw data into meaningful and useful information. It allows business users to make informed business decisions with real-time data that can put a company ahead of its competitors."