Business process management is the cross-functional orientation of organizations along the value chain. This article discusses the basics and advantages of process orientation in companies. Using the classic process life cycle, well-known as well as emerging techniques, methods and tools are explained. Intuitive and complex process analysis methods are introduced, and alternatives of meaningful modeling are differentiated. For the implementation of the optimized processes, relevant aspects of team management as well as basic classes of IT tools are discussed in order to support not only manual but also digital processes. How processes are monitored strategically and operationally is also part of the life cycle. Furthermore, upcoming trends are part of the discussion.
TopIntroduction
The historical development of the business organization as well as the management theory took place in three fundamental phases. Until the 30s, the focus of the company organization was on technical problems in production and administration. At the beginning of the 80s, companies were structured into a hierarchies and processes. In this dualistic viewpoint, the focus of process was on the execution of tasks and the focus of organizational structure was on departments and positions (Krallmann et al., 2002). In the last and current phase, companies are increasingly focusing on value chains and workflows (vom Brocke & Schmiedel, 2015). Modern companies understand corporate structures as continuous procedures and value chains (Jeston & Nelis, 2010), which may also connect companies across organizational boundaries (Manuel, 2011). Instead of focusing on individual functions and optimizing individual business units, productivity and quality in seen in the overall business context and especially business processes influence the value of companies (Franz & Kirchmer, 2012).
Processes can be found in almost every company and every organization. They describe patterns (e.g., processing information) of how a company responds to events (e.g., a customer request). It has been confirmed in studies that with the optimization of processes the classical business goals like time, cost and quality can be improved (Weske, 2012).
There are many definitions of business processes. All have in common (Weske, 2012; Allweyer, 2014; Lehmann, 2012; Gadatsch, 2012) that a process consists of a sequence of activities (e.g., delivery of material, processing steps in the factory, outbound logistics). It typically has a defined start (input, trigger, e.g., a customer order) and completes with a defined end (output, e.g., automobile was provided to the customer). The result is of value to an internal or external customer (e.g., price of an automobile) and the procedure uses specific information (e.g., order data).
Some textbooks and standard works make a distinction between processes and business processes. The latter is characterized by two further properties (Weske 2012; Allweyer, 2014; Lehmann 2012; Gadatsch 2012). First, a business process is usually carried out with division of labor by several organizations or organizational units (for example, sales, production, logistics). Business processes are thus cross-functional. Second, the business process describes the creation of services according to the given objectives cascaded from an enterprise strategy (e.g., focus on quality leadership leads to more quality assurance steps in the process).
Business processes are understood as the set of goal-oriented operations that are carried out in several functional areas of a company and whose results are of value to a customer (Hammer & Champy, 2003). While processes generally transform a given input into an output (Schmelzer & Sesselmann, 2008), business processes always deliver a performance that is oriented towards the respective customer and generates significant added value for him/her (Allweyer, 2014).
Business process management (BPM) is understood as an integrative concept of leadership, organization and controlling that enables control of these operations. It is also about meeting the needs of customers and other interest groups (Schmelzer & Sesselmann, 2008; vom Brocke & Schmiedel, 2015; Franz & Kirchmer, 2012).
In contrast to projects that take place only once, processes usually have multiple instances. This term is defined as a concrete execution of the business process. For example, the ordering from one customer of a specific car of a particular type carries individual information (e.g., color, equipment, etc.) as an instance, but follows the general model of manufacturing processes in production. The number of instances varies from process to process. Development processes can sometimes have only one process instance per year, while for example complaints or payroll processes may have thousands of instances per year (Weske, 2012).