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Plug it in 1: Business Processes and Business Process Management

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Business Process
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A collection of related activities that create a product or a service of value to the organization, its business partners, and/or its customers.
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Business Process Management (BPM)
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A management technique that includes methods and tools to support the design, analysis, implementation, management, and optimization of business processes.
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Business Process Re-engineering (BPR)
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A radical redesign of a business process that improves its efficiency and effectiveness, often by beginning with a “clean sheet”.
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Cross-Functional Processes
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No single functional area is responsible for a process’s execution. –
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The 3 fundamental elements of the business process.
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-Inputs -Resources -Outputs
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Description of the Input element of the BP.
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Materials, services, and information that flow through and are transformed as a result of process activities.
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Description of the Resources element of the BP.
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People and equipment that perform process activities.
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Description of the Outputs element of the BP.
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The product or service created by the process.
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The two fundamental metrics that organizations employ in assessing their processes and their descriptions.
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Efficiency and Effectiveness
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What is measured through Efficiency.
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Focuses on doing things well in the process; for example, progressing from one process activity to another without delay or without wasting money or resources.
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What is measured through Effectiveness.
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Focuses on doing things that matter; that is, creating outputs of value to the process customer- for example, high-quality products.
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Two business processes that cut across multiple functional areas within an organization.
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Procurement and Fulfillment.
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Description of the Procurement Process.
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Includes all of the tasks involved in acquiring needed materials externally from a vendor
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Description of the Fulfillment Process.
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Concerned with processing customer orders.
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Three areas of the Business Process in which Information Systems play a vital role.
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-Executing the Process -Capturing and storing Process Data -Monitoring Process Performance
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Process Data (Transaction Data)
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Data captured during a transaction about the customer and their purchase.
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Instance Level
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A level at which the business process is monitored, in which the process is monitored by specific tasks and activities.
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Process Level
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A level at which the business process is monitored, in which the process is monitored as a whole.
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The 6 measures of a Successful Business Process.
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-Customer Satisfaction -Cost Reduction -Cycle and Fulfillment time reduction -Quality -Differentiation -Productivity
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The Five basic Phases of Business Process Improvement (BPI).
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-Define -Measure -Analyze -Improve -Control
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Description of the ‘Define’ phase of BPI.
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-The BPI team documents the existing “as is” process activities, resources, and inputs and outputs. (Graphical Process Map) -The team also documents the customer and customer’s requirements for the process output, together with a description of the problem that needs to be addressed.
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Description of the ‘Measure’ phase of BPI.
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-The BPI team identifies relevant process metrics to generate one output (Product or service) and collects data to see how the metrics evolve over time.
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Description of the ‘Analyze’ phase of BPI.
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The BPI team examines the “as is” process map and the collected data to identify the problems with the process and their root causes. -The team should also benchmark the process.
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Description of the ‘Improve’ phase of BPI.
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The BPI team Identifies possible solutions for addressing the root causes, maps the resulting “to be” process alternatives, and selects and implements the most appropriate solution.
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Description of the ‘Control’ phase of BPI.
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The team establishes process metrics and monitors the improved process sfter the solution has been implemented to ensure the process performance remains stable.
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Business Process Management Suites (BPMS)
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An integrated set of applications that includes a repository of process information, it is used to support Business Process Management activities.