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Importance of Business State Machine in BPM adoption

For the last one year I had been having interesting discussion around BPM with multiple customers in different industry vertical. And when I analyze these discussions one problem statement was strikingly similar across different verticals, which can be summarized as
  

"If you consider the end to end business process as seen by the business process owner, 60-70% of the process is currently encapsulated in ERP or certain be-spoke applications which are performing well, so how can I continue to utilize these investments and also adopt Business Process Management".

While analyzing this statement few areas came up for further discussion, which made everybody think about the end to end process implementation.
Today if we take any end to end business process and system view we would see the implementation as shown in the diagram below

End To End Process View 

Resulting in  
  • No end to end process view exists systematically which could provide business process owner a consolidated view of his/her process as he/she sees
  • Business process owner continues to get a segmented view of the process being implemented in different set of applications including ERP and been managed by different department resulting in
    • No formal KPI ownership - With departmental view of the process, there are no formal ownership of end to end process KPI
    • No holistic view for Process improvement - Process improvement initiatives are driven from a departmental view perspective and does not take into account the end to end process
And this where Business State Machine from BPMS offering comes handy and can address a lot of Business Process Owner concerns highlighted above. In this blog I am not going into details of Business State machine definition but to put it in simple language it is managing the process through well established States / Stages of Business Process which is important to business process owner.
So how do we apply Business State Machine to solve the problem? There is no single way to address the problem; however I have been using the following guidelines to drive the solutions for our customer 
  • Working with the Business team and application group to identify key stages or states of the business process and utilize Business State machine to model the end to end process with these Key States / Stages
  • Work with the Business team to
    • First identify overall process performance KPI and KPI at various process states / stages
    • Second identify overall business value KPI and KPI at various process states / stages
  • Subsequently identify the source for Business States from underlying application which would be interfaced with the Business State machine to ensure management of overall Business process in terms of states / stages
  • Understand the latency requirement from Business State perspective and identify a event based architecture to address the requirement
The value demonstrated by approaching BPM adoption using Business State Machine has been very promising and some of the areas other than end to end process visibility where our customer derived benefit were
  • Increased Process Operational efficiency - Business State Machine coupled with KPI monitoring (Both process and business value) would enable business process owner to take an informed decision for marshalling its resources to manage the process better
  • Support Process Improvement Initiative - This is one of the biggest benefit an organization can derive from BPM implementation. The decision to automate certain lag of the process would be driven and supported by a value driven approach
  • Metrics driven management of business process performance - Any ERP or IT improvement initiative can be measures continuously to ensure the value realization
Although we see applicability of Business State Machine to any type of process, however we have seen more value realization for processes which are iterative in nature. Also one should be careful on approaching such solution as over engineering of the technical solution could lead to premature end of such initiative

Posted by Manas Kumar Sarkar on December 29, 2009 03:55 PM |

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