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TopBackground
In the body of literature on supply chain management (SCM), researchers have claimed that a business process orientation of SCM has been proven to be an effective way to enhance business performance as well as customer satisfaction (Trkman et al., 2007). Cooper et al. (1997, p. 20) define SCM as ‘the integration of key business processes from end-users through original suppliers that provide products, services and information and add value for customers and other stakeholders. Therefore, a supply chain can be regarded as an overarching business process starting from the original supplier to the end customer. Therefore, SCPM is essentially about an extended business process which crosses the boundaries of individual companies along the supply chain.
It is clear that SCPM is deeply rooted in BPM, which provides a platform for achieving a common understanding of a business process (Aguilar-Saven, 2004). Good process models are critical for making well-informed decisions when it comes to business process (re-)design and (re-)engineering and information system development. BPM can be defined as a methodology using software systems to design, analyze, manage and improve business processes in order to increase the productivity and revenue of a company (Bae & Seo, 2007; Trkman et al., 2007).
In the BPM literature, it is a common view that when constructing a business process model, one should use a particular modeling technique for a particular modeling purpose (Aguilar-Saven, 2004). Due to the ongoing interest in BPM both in research and in applications, there are a wide variety of BPM techniques which range from the basic tools such as flowcharting, to academically studied techniques such as Petri Nets (Ricker et al., 2009). Essentially, the techniques used for BPM can be classified into two categories: (1) descriptive (or pragmatic) approaches such as UML, and (2) formal (or rigorous) approaches such as Petri Nets (Ryan & Heavey, 2006; Aguilar-Saven, 2004). As a supply chain can be regarded as an extended business process, many BPM techniques can be used for SCPM.
Key Terms in this Chapter
Business Process Modeling: The activity of representing a company’s business processes so that the current process can be performed in a more effective and/or efficient way leading to improved business performance.
Process Integration: An approach of attaining close alignment and seamless coordination of internal and/or external business processes.
Business Process Reengineering: A method by which business performance can be dramatically improved through rethinking and redesign of processes.
Internal Processes: The business processes that can be executed without involvement of an external business partner such as the internal production process.
Object-Oriented: System design or analysis, or software program that use objects.
System Dynamics: A method through which the dynamic behavior of a complex system over time can be better understood by taking into account internal feedback and time delays.
External Processes: The business processes that cannot be executed without involvement of an external business partner such as the customer relationship management process.
Benchmarking: A performance management practice by which a company compares its own business processes and performance metrics to those of the best in the industry.
Monte Carlo Simulation: A computerized simulation technique which is usually used for analyzing the behavior of a system or a process involving uncertainties.