Every organization, regardless of the level of complexity, consists of different business processes. From a small grocery shop to an international financial services company, they both rely on processes to function: how to handle purchase requests, warehouse management, loan origination procedures, new employees onboarding. They are all processes.
Whether formalized or not, business processes can be defined as a sequence of repetitive activities - involving multiple departments and systems, that contributes to the overall business goal. As stated in our previous blog post, we can say that a business is only as efficient as its processes.
Hence, it looks obvious that if they’re not accurately organized, business processes can affect the entire organization’s efficiency. Even the smallest error, if perpetuated, can lead to a much larger lack of performance.
That’s why Business Process Management is essential.
The benefits of the Business Process Management lifecycle
As defined by Gartner, Business Process Management (BPM) is a discipline that uses various tools and methods to design, model, execute, monitor, and optimize business processes. In other words, through BPM, organizations can create, analyze and improve their business processes in order to increase the overall efficiency.
Though often considered a discipline for big companies, BPM can actually provide remarkable benefits to every business, no matter the size:
- Gain control of every process.
- Make the everyday activity more efficient.
- Identify and solve bottlenecks and frictions.
- Provide employees with the bigger picture.
- Evaluate both individual and overall performance.
Business Process Management allows to systematically and constantly improve company processes. It’s generally represented as a cycle of five different phases and actions that are repeated over and over again, in a non-strict order, to get continuous improvement.
Let’s explore these five stages in detail and the objective of each of them.
The 5 steps of the BPM lifecycle
The first step of the BPM lifecycle is the design. The main goal of this stage is to understand how the business process works, what the resources involved are, including both employees and tools, and what the desired outcome is. Gaining an in-depth understanding of the business process is the first essential step to identify bottlenecks and, thus, areas for improvement.
Collecting information is key in this phase. From the way the process starts (what inputs) to how it ends (what outcomes), you should identify each task’s responsibility, systems integrations, and the business rules behind it.
Once you have identified and understood the process, you need to represent it in a way that all people involved can clearly visualize it. Here comes the second step of the BPM lifecycle: modeling.
In this stage, you draw how things are currently done: the so-called “as-is” version of the process. Modeling a process allows to spot inefficiencies and bottlenecks that can be improved. This leads to a second version of the model, called the “to-be” process, where the necessary improvements are modeled. You may be able to model the “to-be” process from the very beginning or you may first need to monitor the “as-is” version. No matter how many steps and cycles you need, being able to directly compare the two models is essential to inform other stakeholders about the new improvements and agree upon them.
When modeling business processes, relying on a standard can really make the difference. The most widely used standard is Business Process Model and Notation (BPMN), which provides a series of elements that help represent even the most complex process. BPMN essentially serves the main modeling purpose: making the process readable and understandable by everyone. You can also decide to take it a step further and visualize the operational decisions and relative KPIs. You can do so by using the Decision Model and Notation (DMN) standard. If you want to know more about the benefits of combining process and decision modeling, read the blog post by Cardanit Product Manager.
The third step of the BPM lifecycle turns diagrams into practice. It’s the execution phase, which can be either manual or assisted by a BPMN engine, or both.
For complex processes, in which the proposed improvements can be very expensive in terms of both cost and effort, the good practice suggests first executing it within a small group of people. This way you can evaluate the impact and assess the effectiveness before implementing it on a larger scale.
Trial and error, even if starting within a testing environment and although often necessary, can also be risky and expensive. In these cases, Process Simulation can take this phase one step further.
So, you understood how the business process works and where the bottlenecks are. You put it on a clear BPMN workflow and drew the possible improvements. Then you executed the process. Now, how can you determine that the proposed changes are actually working?
Let’s turn to the man who invented modern business management: Peter Drucker. As he said, “if you can’t measure it, you can’t improve it”. This assumption highlights the importance of the fourth step of the BPM lifecycle: monitoring.
In this phase, you monitor and review the process in real-time: you set KPIs and get tangible insights to evaluate the performance of the process and the effectiveness of the implemented changes. Are the bottlenecks resolved? Are all resources working smoothly and efficiently? Are the delays and mistakes adjusted? All these questions should be answered by monitoring and analysis.
The information gained from the monitoring phase allows you to know if the “to-be” process is actually giving the expected results. In the last step of the BPM lifecycle, you optimize the process to find ways to improve it further and enable the organization to work more efficiently.
As said above, processes are by definition repetitive, and continuously implementing even small improvements can really affect the overall performance.
In the optimization phase you see the bigger picture, analyze the results, and suggest further small or big changes to the process.
For the BPM lifecycle to be truly successful, you need to approach it with a continuous improvement mindset.
For the BPM lifecycle to be truly successful, you can’t stop after the optimization stage. You need to start over again to ensure continuous business process improvement. Just like business processes are repetitive, so should the BPM lifecycle steps.
Modeling business processes with Cardanit
Although you may need to skip one or more of the steps described above, it’s clear that the modeling phase plays a key role to improve your business process. Being able to clearly visualize the process lays the basis for any improvement. In such a scenario, relying on a BPM software like Cardanit can really make this step easier.
Based on the BPMN and DMN standards, Cardanit helps you map from the simplest to the most complex process, making the modeling phase very smooth. You can focus on the most important aspects, rather than on the design part: what the sequence of the tasks is, what departments and systems are involved, if and where there are any frictions. In addition, you’re able to involve all stakeholders, so they can all agree upon the different versions of the process and see how their work can change and be more efficient.