ppttest 8/8/2015 22:29 1 it ron williams information technology management business processes
TRANSCRIPT
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Ron Williams
Information Technology Management
Business Processes
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A Business Process According to Pearlson
• A beginning and end
• Inputs and outputs
• A set of tasks that turn inputs into outputs
• A set of metrics that turn inputs into outputs
“This may seem like a simplistic model of a process, but the truth is that a process is simply a set of tasks that are done to effect transformation of inputs into outputs”
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Typical business processes
• Examples of business processes include:– Customer order fulfillment, – Manufacturing planning and execution,– Claim processing– Stock trade– Mortgage application processing– Financial reporting – Procurement
• Each business processes includes the following:– A beginning and an end– Inputs and outputs– Sub-processes that turn inputs into outputs– (Should include) A set of metrics for measuring effectiveness
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Traditional Representation & Characterization of a Business Process
•Drivers: Tasks & Sequence
•Characteristics
•Well Structured
•Linear
•Consistent/Standardized
YesNo
Start Here
End Here
Or
Follow the Arrows
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Simple Procurement Process
Receive requirementfor goods/services
Create and send
purchaseorder
Receivegoods
Verifyinvoice
Pay vendor
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Mortgage Loan Workflow Process
Title Search
Complete Application Appraisal Credit History
Financial Status
Request
Approval Approval/Denial
Yes
Complete Documents
Close
NoReject
Input
Output
Measure Home
Rate Quality
Identify Comps
Analyze Value
Input Address Output Value
Sub-process
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What is the Value of Workflow Business Process
YesNo
Start Here
End Here
Or
Follow the Arrows
•Define/Understand How Work Gets Done
•Streamline & Optimize to Increase Efficiency – Take out
•Time
•Cost
•Assure Quality
•Enable Automation
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Information Systems Support Options
• Automate or support “as is” process
• Incrementally/continuously improve the process (Total quality management –TQM- is an example of this)
• Radically redesign before supporting ( Business process reengineering –BPR)
• Re-define the process to match package software process definition
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Hierarchical Structure with “as is” Process View
Executive OfficesCEO
President
marketingoperations accounting finance administration
•Functional groups within a firm tend to complete their portion of a process and “throw it over the wall” to the next group in the value chain.
•Supporting “as is” processes with IS perpetuates
•Duplicate information
•Communications problems
•Ineffective organizations
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Managing from a Business Process Perspective Increases Efficiency & Effectiveness
OPERATIONS
MARKETING
ACCOUNTING
FINANCE
ADMIN
Functions
Business Processes
•A process focus creates value by:
–Identifying the customers of processes
–Identifying these customers requirements
–Clarifying the value that each process adds to the overall goals of the organization
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Incremental Change
Understand“As Is”
(Current) Process
Monitor andMeasure
Select Focus Area for Change
Develop and Implement
Change
Repeat Process
Develop Key
Metrics
•Mapping “as is” process
-Process engineers begin process mapping by defining the scope, mission and boundaries of the process
-Next, the engineer will develop a high-level”flowchart” (description) of the process.
-Next, he/she develops a detailed “flow diagram” (description) of everything that happens in the process.
•Key Metrics
-Customer Satisfaction
-Quality
-Operating Costs
-Revenue
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Business Process Reengineering (BPR)
Set the Stage, Develop Vision
of “To Be”
Understand“As Is”
(Current) Process
DevelopTransition
Plan
ImplementPlan
Monitor andMeasure
Set the Stage, Develop Vision
of “To Be”
Understand“As Is”
(Current) Process
DevelopTransition
Plan
ImplementPlan
Monitor andMeasure
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Enterprise Information Systems
• An enterprise system is a comprehensive software package that incorporates all modules needed to run the operations of a business (like ERP)
• It should include the following modules:– Manufacturing– Accounting– Human resources– Sales
• The most widely used enterprise system is offer by a German company, SAP.
• Among many competing products are those produced by PeopleSoft, Baan and Oracle.
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Benefits of Enterprise Systems
• In an enterprise system, all information system modules communicate with each other, offering enormous efficiencies over stand-alone systems.
• For example, manufacturing and accounting may keep their own vendor records and these accounts are kept in somewhat different form.
• Implementing an EIS will also require that business processes be redesigned to achieve optimal performance of the integrated modules.
• The EIS has some flexibility as well, since, once developed it is a relatively simple matter to change parameters in a process.
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When an EIS is appropriate
• Situations in which it is appropriate for an EIS to drive business process design include:– When an organization is just starting out and
processes do not yet exist.– When an organization doesn’t rely on its
operational business processes as a source of competitive advantage.
– When current systems are in crisis and there is not enough time, resources or knowledge in the firm to fix them.
• But it is not appropriate when the business derives strategic advantage from the processes that the EIS would support
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What about Other Processes
• Product innovation• Web site design• Learning• Executive decision to buy a company• Complex system sales• Development of an ad campaign
• Does this definition work?
“This may seem like a simplistic model of a process, but the truth is that a process is simply a set of tasks that are done to effect transformation of inputs into outputs”
YesNo
Start Here
End Here
Or
Follow the Arrows
YesNo
Start Here
End Here
Or
Follow the Arrows
•Does the picture work?
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Relationship Process Model
Customer Request Performer Acceptance
Performer Fulfills
Customer Declares Satisfaction
Source: Action Technologies
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Putting Requests and Responses Together
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
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Compare the Pictures
YesNo
Start Here
End Here
Or
Follow the Arrows
YesNo
YesNo
Start Here
End Here
Or
Follow the Arrows Efficient Reduces costReduces timeImproves Quality
Task Driven
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Relationship Driven
FlexibleIncreases customer satisfactionEnables innovation
Push
Pull
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Business Process
• Definition: Recurrent set of business rules that is linked to other processes through an interface
• Recurrent: If it is not done over and over than it is just a decision and why invest resources to do it well
• Business Rules: This is the structure of the process that defines how the business handles a request
• Interface: The linkage to other processes
Source:Peter G.W. Keen
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Business Strategic Context
Suppliers Enterprise
Intermediaries
Customers
Value Chain
Joined-up Business
Suppliers Enterprise
IntermediariesIntermediaries
CustomersCustomers
Value Chain
Joined-up Business
Value Net
EnterpriseCustomers Suppliers
Intermediaries/Complementors
Competitors/Substitutors
New Joined -up Business
Value Net
EnterpriseCustomers Suppliers
Intermediaries/Complementors
Competitors/Substitutors
New Joined -up Business
Current State
Future State
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Could We Combine the Best of Both Worlds?
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
Customer Request
Performer Acceptance
Performer FulfillsCustomer Declares
Satisfaction
YesNo
Start Here
End Here
Or
Follow the Arrows
YesNo
YesNo
Start Here
End Here
Or
Follow the Arrows
Flexibility & Efficiency
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We Need a Business Services View of Processes to Create Flexibility
Customers
Contracting & Fulfillment Manager
Standard Business Services
Custom Business Services
Custom Business Services
New Business Services
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Relationship View of Processes
Contracting & Fulfillment Manager
Business Services
YesNo
Start Here
End Here
Or
Follow the Arrows
YesNo
YesNo
Start Here
End Here
Or
Follow the Arrows
Relationship
Collaborative Contracting
Proxies (Authority)
Events (Dynamics)
Fulfillment
Contract Boundaries Define Business Services Inputs & OutputsWorkflows within Business Services for Efficiency
Customer
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We Need a Relationship View of the Loan Process
CustomersApply
Contracting & Fulfillment Manager
CreditAppraisal
Title
Approval
Documents
InsuranceHome
Improvements
Other
Services
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Loan Process Based on Relationships & Events
Title
Apply
Approval
Business Services
YesNo
Start Here
End Here
Or
Follow the Arrows
YesNo
YesNo
Start Here
End Here
Or
Follow the Arrows
Pre & Post
Quick/Complete/ Existing Customer
Appraisal
Financial Checks
Document
New Services
Contracting & Fulfillment Manager
Customer